What Makes an NFT Unique?
By this point, you’ve probably heard the term “NFT” dropped a few several times in conversations. While you might be familiar with the term, it’s worth knowing that there’s more to the NFT market than the Nyan Cat gif. One of the main selling points of the NFT craze is that it’s unique. The uniqueness of NFTs makes them appealing to creators and buyers alike, allowing for original artwork and collectibles to be bought and sold in the digital marketplace.
If you’re interested in getting involved with the NFT market, it is crucial to understand what makes each NFT a distinct product—and why that makes them so popular.
Read on to learn all the details of how NFTs work and what makes them so special.
What is a Non-Fungible Token?
First, let’s review the basics. An NFT, or non-fungible token, is a specific digital item that exists on a blockchain, such as the Ethereum blockchain. The key concept here is that this item is non-fungible, much like art. Unlike Bitcoin, NFTs can’t be exchanged for other NFTs, or divided down into smaller parts.
As a result, an NFT is an ideal medium for creating unique, original versions of digital art. On marketplaces like Rarible or Opensea, digital artists can sell one-of-a-kind original art. The digital signature of the NFT cannot be replicated, and thus the NFT becomes a unique digital asset.
How an NFT Works
To understand what makes an NFT unique, it’s helpful to know how NFTs work. Whenever you create a new NFT, it gets an individualized digital signature, otherwise known as a certificate, created simultaneously through a smart contract.
Essentially, whoever owns that unique digital signature as proof of ownership of the associated NFT. That signature, or certificate, can be given to other buyers on the blockchain in exchange for cryptocurrency. Whoever has the certificate in their digital wallet becomes the official owner of the NFT.
Why an NFT is Unique
You may have the concept down of how an NFT works, but the uniqueness of an NFT can still be a big idea to grapple with.
Whenever a creator makes something new, whether it’s a visual artwork, musical composition, film, etc., it’s an original piece of art that they alone have the right to. This gets complicated when you move from the real-world art market to the digital world.
When creative work has been done digitally, it is effortless to copy and distribute it. This makes selling one’s art very accessible, but it also makes it very difficult to maintain sole rights to artworks saved as digital files.
It’s also challenging to make digital art be truly valued for what it’s worth since the market is flooded with so many copies of it. In other words, if Monet was a digital artist today, his original work would be valued at about the same as the prints you buy from the museum gift shop.
This is where NFTs can become extremely helpful. By putting a digital artwork on the blockchain and using blockchain technology to assign it a unique digital signature, buyers and sellers on NFT marketplaces have a way of distinguishing the original item from the many copies that exist online. This allows for original artwork to be correctly valued and not just treated as a derivative replica—NFTs are even being bought and sold by major art auction houses, such as Christie’s.
NFT art dealing has become a significantly lucrative market, and NFTs can end up being a very wise investment. For instance, Mike Winkelman, otherwise known as Beeple, was able to sell an NFT artwork for $69.3 million, making him a major celebrity in the digital art world.
Various mediums can become NFTs, from visual art to video clips and even gifs and memes. Artifacts like tweets can be valued highly when made into NFTs—Jack Dorsey made $2.9 million by selling the NFT of his first tweet. Virtual real estate has also become quite popular on the NFT market and digital collectibles like trading cards.
By having a digital certificate of ownership, the owner of the work of art has tangible proof and protection of their copyrights. The digital signature cannot be tampered with or separated from the digital item, and any transfers of ownership are recorded on the public ledger. This establishes clear documentation of rights and proof of ownership, all connected to the one hundred percent unique and distinct digital signature that is given to each NFT added to the blockchain.