What is an NFT? Do you ever find yourself asking this question? Over the past couple of months, the term has been used everywhere. In fact, according to Google, in the early months of 2022, NFTs have been one of the highest searched topics on the entire internet.
The term NFT stands for Non-Fungible token. Simply put, it functions as a unit of data that allows digital content, including videos, songs and images, to become a part of an online database. These online databases, also known as blockchains, are backed by cryptocurrency (any form of a digital or virtual form of currency). Once uploaded onto the blockchain, every transaction is recorded online with an easily accessible ledger displaying origin and price history.
Before NFTs existed, artists compiled a following through social media and other online platforms in order to sell their work. Now, NFTs allow artists to monetize their art directly, which in turn, creates a public marketplace for digital art to be bought and sold online.
Recent NFTs have sold for millions of dollars on NFT marketplaces such as OpenSea, Nifty Gateway, SuperRare and others. In December 2021, an NFT named CryptoPunk #4156 sold for approximately $10.26 million on the open market.
There is no doubt that the current digital market is on fire right now. A current high school senior offered his opinion on cryptocurrency and explained how NFTs are being discussed in class.
“I personally haven’t had any ties to the NFT or crypto marketplace, although in my entrepreneurship class it has been the topic of great discussion and the direction that new generational money and wealth opportunities is going towards,” the student said.
In order to understand NFTs in their entirety, it is important to dive into the business side. Many individuals view NFTs as an investment, and will constantly buy and sell them in order to make a profit. As the value of cryptocurrency continues to rise, the value of digital art such as NFTs rise as well.
Another high school junior described his involvement in the NFT business and how his passion led him to begin his first project.
“When the country first shut down, I found myself needing both a hobby and a passion, and NFT’s filled that hole extremely well. Just as soon as I entered the space, I started trying to build connections and meet others who were just as immersed in this world as myself. Over two years later, I have cemented myself in the world of NFTs by building connections with some of the most influential individuals, which has allowed me to establish a team to push my first NFT project,” said the student.
Despite the recent hype and ridiculous sales, many individuals view NFTs and cryptocurrency as a trend that will subside.
The value of cryptocurrency, which is the foundation of NFTs, does not have intrinsic value; it depends on the number of people who use the service, which is why some have been critical.
Nevertheless, the popularity surrounding the entire industry suggests NFTs will continue to thrive. With society becoming more technologically advanced and transitioning toward becoming more and more digital, it is reasonable to assume that the NFT is here to stay.