NFTs have taken over the internet by storm. After Bitcoins, the latest buzz says that NFT tokens are the next big thing and the market is anticipated to grow 10 folds over the next few years. Based on blockchain technology, NFT has raised a global market cap of $389 million alone in 2020. So, what are NFTs and how are they different from cryptocurrencies?
What is NFT?
NFTs are non-fungible tokens or cryptographic assets built on blockchain technology that assigns proof of ownership to a specific item. This ownership cannot be replicated, modified, copied, or exchanged and can be used to buy and sell items safely on the internet. They eliminate the barriers of intermediaries and simplifies the transactions.
So, it seems that both NFTs and cryptocurrencies can be used to make commercial transactions but how are they different?
Unlike NFTs, cryptocurrencies are fungible assets that can be exchanged, replaced, or traded with one another. E.g., the value of one bitcoin will always remain the same and be equal to another bitcoin. The same goes with fiat currencies INR or USD which are also fungible.
NFTs have a unique set of physical attributes that makes them different from other digital tokens. Each NFT block is different from the other and is identified by a string of unique characters.
NFT tokens can be used to purchase, sell, and represent virtually any kind of item such as:
- Digital art
- Video games and other virtual products like avatars, weapons, virtual currency for playing games, etc.
- Real estate
- Music industry
- Digital trading cards
- Sports collectibles
- Video clips
- Digital images etc
Best Platforms to Launch your NFT Tokens
Creating NFTs is not rocket science. If you are tech-savvy and have some basic knowledge about cryptocurrency, you are good to go. Before you start, you must choose the blockchain on which you want to create NFTs. There are a few blockchain smart contract platforms. Each blockchain platfrom has its own set of properties, supportive wallets, network fee, tokens, etc. Let us have a look at the smart contract platforms to launch your own NFTs.
Most of the NFTs are built on the Ethereum network today mostly because it supports ERC20, ERC-721 and ERC-1155 token standards. Wallets that support these tokens are Coinbase, Trust, MetaMask, etc. These wallets support Ether as well as other fiat currencies like the British pound and US dollars, etc. OpenSea, Mintable, and Rarible are some Ethereum marketplaces where you can create NFTs. To take part, you have to pay a token fee called ‘Ethereum gas’ which depends on the number of transactions or value of transactions on the network.
Users can buy, sell, and mint NFT tokens on the Tezos blockchain network. Platforms like Kalamint, Hicetnunc, FA2 with standard TZIP-12 token, etc. are NFT communities built on the Tezos network especially for artwork, trading cards, applications, etc. Compared to Ethereum, critics believe that Tezos is cost-saving and conserve energy that allows seamless minting, buy, and sell of NFTs across the community.
Binance Smart Chain
Another popular marketplace for NFT is the Binance Smart Chain blockchain network. You can use a Trust wallet to store your NFTs. BakerySwap, Battle Pets, and PancakeSwap, Refinable, etc. are some of the popular marketplaces for NFTs on the Binance network. BakerySwap is a fun NFT marketplace where you can bake, stake, and earn NFT tokens as well as sell collectibles and artwork. Battle Pets is for gamification and trading NFTs. You can use your NFT rewards to buy pets and weapons for the game. The PancakeSwap is another interesting DeFi project where you can trade assets using interesting cartoon characters like the rabbit. You can buy tickets to collect redeemable cakes baked by the rabbits and these tickets are then pooled into a liquidity pool or prize fund.
On December 24, 2020, Justin Sun, the CEO of TRON, a Chinese blockchain network released its TRC-721 standard token for NFTs. The TRC-721 standard interface is compatible with ERC-721 of the Ethereum network. Users with a minimum balance of 350 TRX can issue NFTs using the TronLink chrome extension. The recent dApp called the CryptoFlowers is a game where you can collect and redeem digital flowers on the platform.
Enjin has recently raised 18.9 million dollars to launch its new NFT blockchain called the Efinity on the Polkadot network. The launch is due at the end of 2021 or the beginning of 2022. EFI will be the native token of the Efinity network. The network will introduce new dApps, games, and enterprises built on the Polkadot network.