What is NFT? Ultimate Professional Guide 2022

There has been an explosion of Non-Fungible Tokens (NFTs) in the digital world. From music, videos, and graphic arts, to tweets and toilet papers, NFTs are selling. Some of them even have sold for millions of dollars. The lives of digital artists have changed and been blooming, thanks to NFT. They are now getting the sales, the recognition, and the praise they deserved. Celebrities and mainstream brands are also jumping on the bandwagon of NFTs.

It is not limited to digital assets; any physical unique asset can also sell as NFT. Some people believe NFT will be over soon, while others say it is here to say. NFTs started around 2014. But recently they have gained traction and popularity and have become such a smash.

Table of Content

• What is NFT?
• How does NFT work?
• Why NFT’s are used?
• How to buy an NFT
• Market places to Buy NFT
• Impact of NFT
• Should you buy NFT?
• Conclusion

What is NFT?

NFT refers to digital assets like music, art, photos, videos, and games bought and sold online through cryptocurrency. These digital assets can have only one owner at a time. Each NFT has a unique digital signature which means two NFTs cannot be the same.

NFTs are Non-Fungible Tokens which means they have unique properties and cannot be exchanged for other items. Whereas cryptocurrency is fungible, they can be traded and exchanged with one another.

How does NFT work?

There are many blockchains where it can be held but the majority of the time they are held on an Ethereum Blockchain. Following is the list including NFT (Both tangible and intangible).

• Graphic art
• GIFs
• Videos and sports highlights
• Collectibles
• Virtual avatars and video game skins
• Designer sneakers
• Music
• Tickets
• Signatures
• Legal documents

Why NFT’s are used?

Now that we have talked about what NFTs are. Let’s understand the reasons for using NFTs:

Freedom and Complete Ownership

In the modern day, the digital world’s system is a mess. Platforms swallow the earning potential and real profits of artists. If an artist publishes art on a platform, the platform will sell ads to the artist’s followers. Here, comes to the rescue of the artist.

NFT’s provide freedom and complete ownership of the content to the artist. Moreover, he/she doesn’t have to go to an auction to sell their art; they can directly sell it to the buyer.

More Revenues and Profits

Plus all the revenue and profit will go to the artist. Moreover, if the buyer sells NFT again, the original creator will get some percentage of that sale.

Copyright Problem

Thirdly, digital assets can be easily copyrighted. But with NFT’ you got the ultimate ownership. And if you purchase an NFT, then you will know it’s the real deal that is originally made by its creator. This is a very valuable benefit of NFT.

 The rise in Gaming Industry

Lastly, NFT is boosting the gaming industry. If you buy an NFT item in your game, you can resell it if you stop playing the game. If the game is not maintained anymore or the game is ended, your bought item will remain yours. Bought item will become a digital memory and it will even outlive the game.

How to Buy an NFT

The next question is if you want to buy an NFT, how to purchase it. For that you will need some important things which are as follows:

1: Digital wallet

First of all, you will need a digital wallet, to purchase an NFT. You will store cryptocurrency in this digital wallet.

2: Cryptocurrency

Secondly, you need cryptocurrency. The currency will depend on the seller. You can purchase any cryptocurrency like Ether, Bitcoin, etc through your credit card.

3: Connect your wallet with the NFT marketplace

Lastly, connect your digital wallet to the NFT marketplace. You can search and explore the NFT of your choice, when your digital wallet will be connected.

Popular Market places to Buy NFT

Now, that we have discussed how to buy NFT. Let’s dive into the popular markets and places that are available to buy or even sell NFT. Following are the best marketplaces at the moment:

1. Opensea
2. Axie Marketplace
3. Rarible
4. Foundation
5. SuperRare

Impact of NFT

NFTs are growing in popularity day by day. But they are being criticized because they leave a carbon footprint that is damaging the environment. NFT arts do not impact the environment; instead, the creation of crypto art is a very energy-consuming process, which is harmful to the Earth’s environment.

Though, it’s going to improve soon. Once it is improved the carbon print and the other harmful factors will reduce substantially.

Should you buy an NFT?

One of the most burning questions is: should you buy an NFT or not? According to, Arry Yu, chair of the Washington Technology Industry Association Cascadia Blockchain Council and managing director of Yellow Umbrella Ventures “NFTs are risky because their future is uncertain, and we don’t yet have a lot of history to judge their performance,” she notes. “Since NFTs are so new, it may be worth investing small amounts to try it out for now.”

Buying an NFT is a personal choice. But keep in mind the value of NFT depends on what a person is willing to give. For example, you may not be able to get the same price that you have bought the NFT. In another scenario, you may not be able to sell it at all.

Also, they have high tax rates. So you will need a tax professional, to keep the operations running smoothly.

Conclusion

NFTs are becoming increasingly popular with each passing day. Every day thousands of NFTs are bought and sold. More and more people are jumping on the bandwagon of NFTs. Many more mainstream brands are developing their own NFTs.

 Determine whether you truly want to buy an NFT or not. While purchasing or selling NFTS do proper research, understand all the risks and benefits, and then proceed.

People believe NFT is the future. But NFT is still in its initial stages. We will see how it will evolve in the next future.