Ultimate Guide To NFTs: How to build an NFT Ecosystem?
NFTs are the key that brings offline world assets to the online, open, and decentralised digital world, fuelling the rise of new digital immersive ecosystems.
This is an extract of the upcoming 'Metaverse NFTs Uprising Ultimate Guide to NFTs' By Dinis Guarda.
NFTs are the future. Just recently, the famous whistleblower Edward Snowden used the technology to auction a piece called “Stay Free”:
“We’re very excited to use the proceeds of this auction to help further our work developing and improving technology that can protect journalists and their sources, like SecureDrop, our open-source whistleblower submission system”.
Ownership and trade are vital aspects of prevalent human culture. However, human concepts of, and our need for, ownership extend far beyond the practical necessities of food, land, resources, and energy. Throughout history, our most prized possessions have often been things with no direct useful or economic purpose. We have created and destroyed, fought over, won, and lost, items of emotional and cultural currency such as religious icons, jewellery, and art that represent the less tangible of our being. Things that manifest the unmanifest codify our ideas and encapsulate our humanity.
Since our earliest history, we have found ways to control the exchange of physical value. More recently, we have also devised and defended systems, such as trademarks and patents, that ascribe ownership and prevent the unauthorised use of intellectual property, intangible assets such as ideas, patterns, designs, and processes, which may have economic and cultural value.
These assets will become increasingly digital as we digitise our lives and culture in what is being called the Metaverse.
Since the advent of the Internet, we have increasingly codified the intangible aspects of our culture electronically in digital media, relying less and less on real-world physical objects. Adoption cryptocurrency is a critical stage in this transition, enabling an exchange of value. NFTs provide the next step, enabling a unique description of a discrete entity.
NFTs - the definition
A non-fungible token is a unique and non-interchangeable unit of data stored on a digital ledger (Blockchain). Although NFTs use the same blockchain technology as cryptocurrencies, what distinguishes them is their lack of interchangeability (fungibility). Each NFT has a unique blockchain address. This characteristic enables NFTs to act as a digital twin for any unique digital or physical asset to provide public proof of ownership.
The world economy has been evolving toward increased digitisation, creating digital twins of everything around us. A digital twin is simply a digital representation, a unique identity, of whatever exists. However, we did not have a way to certify and monetise our digital world as we did with paper technology until recently.
NFTs provide an essential building block for the creation of the Metaverse. They offer a ubiquitous means to securely share ownership, access, and use of a unique set of data. As such, NFTs are then a key enabler of digital transformation and a much-needed invention, enabling us, for the first time, to certify an ever-expanding digital ecosystem on which we are increasingly dependent.
The breadth of NFTs is just beginning to be shown and more developments are taking place as we write this book. The market for NFTs is also expanding. It surged to new highs in the second quarter of 2021, with $2.5 billion in sales so far this year (the NFT wave became serious in 2020), up from just $13.7 million in the first half of 2020, according to marketplace data. Moreover, as Visa bought a $150k NFT, Opensea surpassed $1bn in turnover for August 2021 alone.