What is an NFT?
An NFT (non-fungible token) is a record of ownership of a unique asset. What is an NFT? Let’s recap the difference between fungible and non-fungible tokens:Fungible tokens are interchangeable (e.g., the US dollar, bitcoin).
Non-fungible tokens (NFTs) are unique (e.g., art, music, domain names).
Since NFTs live on the blockchain, they are:
1. Decentralized: Stored on a network of computers.
2. Immutable: Cannot be changed once committed.
3. Open: Anyone can see the transaction history.
Types of NFTs
Let’s look at a few popular types of NFTs:
A few types of NFTs
1/1s (pronounced “one-of-ones”) are single unique assests. Examples of 1/1s are digital art and domain names.
Like museum pieces, people consider the quality of the art, the notoriety of the artist, and the desires of other collectors when evaluating 1/1 art NFTs.
In March 2021, the artist Beeple sold a 1/1 NFT for $69M at Christie’s. Other 1/1 NFT artists include Xcopy, Coldie, Hackatao, and Motionscape (who made an Odyssey NFT).
Collectibles are sets of NFTs that each have unique traits.
Like traditional collectibles (e.g., baseball cards), people consider rarity, cultural significance, and community when evaluating collectible NFTs. Popular categories include:
•Sports: Collectibles representing sports teams, players, and moments.
Examples include NBA Top Shots (NBA moments) and Sorare (soccer players).
•Generative art: Collectibles that are generated from code. For example, ArtBlocks are generated from algorithms written by programmers.
•Profile pictures (PFPs): Collectibles that people buy to represent their online avatars and access PFP communities. Examples include CryptoPunks and Bored Ape Yacht Club.
•Badges: Collectibles that represent special access or ownership within online communities.
Examples include Tom Brady’s Autograph series (holders get special access to future NFT drops and a private Discord) and NFT. Kred’s customizable brand badges (used to reward the most active fans of brands).
•“Lego blocks”: Collectibles designed to be building blocks for something else. Examples include Loot, which features simple text lists of adventure gear. You can imagine people creating character select screens or games from Loot NFTs.
In-game NFTs enable gamers to purchase and own in-game assets as NFTs. This is a nascent space with huge potential as gaming is by far the most popular entertainment category globally.
Axie Infinity is a leading player in this space. The game is especially popular in developing countries like the Philippines where players can earn a living by buying, breeding, and battling digital pets.
Digital real estate includes NFTs that represent plots of land in a digital setting. As people spend more time in the metaverse, creating spaces for them to interact has become a lucrative market.
Settings like Decentraland sell plots of digital real estate on a blockchain for creators to build upon.
If you think about the real world, most things in life are non-fungible (your house, a puppy, etc).
I believe that NFTs will also expand to many more categories in the future (e.g., music, fashion, and maybe even your home deed).
#NFT #NFTs
OpenSea for Ethereum and Polygon #NFTs. Solanart, Magic Eden, and SolSea for Solana NFTs. Foundation and Rarible for Ethereum 1/1 NFTs. Coinbase is also launching a marketplace soon. LooksRare is a decentralized NFT marketplace.
Best #NFT Tools for Tracking and Analysis:
Why Buy NFTs? 
People might buy NFTs to:
Appreciate art
Signal status
Make a profit
Support a cause or creator
Join a community
Let’s explore each reason in detail using as an example.
Appreciate art
People might buy NFTs simply because they appreciate the art or cultural significance.
To understand the appeal of BAYC’s art, we need to start with CryptoPunks - the OG profile pic (PFP) NFT project. CryptoPunks launched in 2017 with 10,000 pixelated punk NFTs
Over the next three years, the punks grew in value as top influencers added them to their profile pics. As of December 2021, the lowest price for a punk is 94 ETH, or $353K.
In early 2021, CryptoPunks was the only well-known profile pic NFT project.
The market was more focused on digital art and NBA sports collectibles. The founders of Bored Ape Yacht Club saw an opportunity.
Going by the pseudonyms of Gargamel and Gordon Goner, they spent $40,000 and..
recruited two blockchain programmers to create 10,000 apes with unique expressions and streetwear-inspired accessories:
Signal status
People might buy NFTs to signal that they belong to an exclusive community.
When Bored Ape launched in April 2021, all 10,000 apes sold out in one night after well-known NFT collectors bought the Apes and updated their profile pics.
Community members were also encouraged to use hashtags like #ApeFollowApe to spread the word.
Since then, many public figures on Twitter have changed their profile pics to a Bored Ape to signal that they’re part of this community.
Make a profit
People might buy NFTs to make a profit by flipping them or holding long-term to get perks.
Flipping NFTs is common for new NFT projects and BAs is no exception. However, as you can see from this OpenSea chart, people who sold a BA early missed huge gains later:
Support a cause or creator
People might buy NFTs to support a cause or creator that they believe in.
In June 2021, every ape holder was able to mint a canine companion NFT for free.
The community was able to raise $1M for animal shelters through secondary sales of these BA Kennel Club NFTs.
Join a community People might buy #NFTs to be part of a community. The Bored Ape community stands out because it has a clear roadmap, transparent communication, and active co-creation.
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| NFT Memes |
A NFT is a digital asset representing ownership or proof of authenticity of a unique item or piece of content, such as artwork, music, videos, or virtual real estate, on a blockchain. Unlike cryptocurrencies like Bitcoin or Ethereum, which are interchangeable and mutually interchangeable, each NFT is distinct and cannot be replicated or exchanged on a one-to-one basis. NFTs have gained popularity for their ability to authenticate digital creations, facilitate ownership transfer, and enable creators to monetize their work in the digital realm.
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