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Clicklers

NFT, Explained!


The Booming Topic of NFT - What is it?

With all of the hype surrounding the crypto world, we can’t but talk about NFT.

NFT stands for non-fungible tokens that have been around since 2014. 

Essentially, NFTs are like physical collector items but only digital ones that represent real-world objects including games, music, art, videos, sports, virtual avatars, GIFs, and even tweets. So instead of getting an actual oil painting to hang on the wall, the buyer gets a digital file instead. 

With the wider adoption of crypto, NFTs are essentially creating a tradable asset through blockchain technology, and are gaining notoriety as they are becoming an increasingly popular way to buy and sell digital artwork. They also tend to work on removing intermediaries, simplifying transactions, creating new markets, and connecting artists with audiences. If you are wondering why those with extra wealth choose to invest and buy an NFT; it’s because of its scarcity and uniqueness that stimulate potential buyers’ curiosity in a specific piece, that they become concerned that someone else will be the sole owner of an NFT they like. Also, because of collectability as many people have a passion to collect scarce items or vintage arts or whatever it is.


How Does NFT Work?


NFT exists on the Ethereum blockchain which is a distributed public ledger that records all the transactions and is robust enough to eliminate any third-party manipulation, ownership, downtime, or intervention on its blockchain. Ethereum blockchain falls under cryptocurrency just like bitcoin which allows storing extra information that makes these NFTs work differently. The underlying technology and the programming language used by NFT are the same as other cryptocurrencies such as Ethash, or Scrypt. Regardless of that, NFT is quite different from Cryptocurrencies, Bitcoin, and Ethereum which are fungible tokens. This means if you trade Bitcoin or Ethereum for one another, you will have the same value and return of money. But, NFT is a unique token that if you try to trade it, you may end up with something completely different in your hands. 


These non-fungible tokens are noninterchangeable and irreplaceable, so each NFT represents unique assets by creating a blockchain-based digital certificate that gives your digital collectibles a unique identity and a digital signature that defines the ownership of these assets. That’s right, NFTs can have only one owner at a time, in which NFTs’ unique data makes it easy to verify their ownership and transfer tokens between owners. The owner or creator can also store specific information inside them. For instance, artists can sign their artwork by including their signature in an NFT metadata. 


Know more about NFT Marketplaces


NFT marketplaces are an integral part of the exciting new trend of NFT, and are your gateway to participating in the purchase, sale, or discovery of digital assets or collectibles. These marketplaces ensure transparency, security, decentralization, smart contracts, and sustainability for artists. In order to be able to use these marketplaces, you would need a crypto wallet which refers to tokenizing or minting to start the process of listing a piece of artwork or purchasing. There is also what is called “NFT Gas Fees” which are payments that users have to make to compensate for the computation energy required to process transactions on the Ethereum blockchain, which is like the processing fees that credit cards may charge for transferring money or paying bills.


There are many websites to create your NFT wallet, these include: 


As for the NFT marketplaces, there are also well-known platforms such as:




Guide to Creating an NFT

NFTs are exploding in popularity in which people are fetching multimillion-dollar sales prices. So for some people, it is worth giving it a try, that is why Clicklers shed the light on the steps that would assist you in creating your NFT.

  1. Select your Item: decide on a unique digital asset that you want to turn into an NFT, and ensure that you own the intellectual property rights so you don’t get into legal trouble. 

 

  1. Choose your Blockchain: find out the blockchain technology that you want to use for your NFT which is the most popular among NFT artists and creators is Ethereum. Then sign up on the NFT auction platform and mint your item into an NFT. 

 

  1. Set up your Digital Wallet: add in your identification documents, buy some cryptocurrency to fund your initial investment, and purchase Ethereum to start the process and get your wallet ready.

 

  1. Determine your NFT Marketplace: research several NFT marketplaces to find the best fit, then connect it to your digital wallet. This allows you to pay the necessary fees to mint your NFT.

 

  1. Create your NFT: create your digital asset, and put in the needed information about your NFT, you can also use the toggle-able field, and ask for your NFT signature.

 

  1. Upload your NFT Artwork File: follow your NFT marketplace step-by-step guide for you to upload your digital file thus turning a PNG, GIF, MP3, or other file types into an NFT. 

 

  1. Set up your Sales Process: figure out how you want to monetize your NFT. 

You can sell it at a fixed price, so to the first person willing to pay the price of your NFT. 

You can start an auction that can be timed or unlimited. You need to determine the minimum price and choose when the auction will start, and how long it will last, and then you can either accept or reject a bid.

 

  1. Pay your Listing Fees: determine if the marketplace you are using includes fees. Usually, Ethereum transactions require a gas fee in which the prices fluctuate depending on the complexity of a transaction and traffic on the network.




NFT x Industries - How Industries are Benefiting from NFTs?


Since people are now willing to pay thousands of dollars for an NFT, and as NFTs are making a strong impact on most of the industries, this has encouraged businesses to take a step forward toward the NFT world. This is an excellent way of showing your brand to new audiences who you may not have reached otherwise, thus leading to more engagement, stronger online presence, stronger relationships between businesses or industries and their consumers, and an opportunity to sell more than just tangible items. Below are some examples of how businesses are benefiting from NFTs:

Many luxury fashion brands such as Prada, Louis Vuitton, and Gucci are using NFTs as they open up the fashion world to new digital channels and digital shopping that comes together with the Metaverse technology. Now people can try virtual clothes or shoes and then enter an auction to purchase them. 

Also, the gaming industry is considered a great target and a booming sector for NFTs as they tend to tokenize the things in the game such as points or credits that can be easily exchangeable and might give true ownership to the player's digital assets. An example of this would be Axie Infinity in which you have to collect monsters that exist as NFTs.

NFTs are also involved in real-world assets and documentation as people can tokenize these assets such as land, license, certificates, etc.

Most importantly, NFTs tend to take over the art industry as it is giving artists a space to show their work to the world and benefit from selling it. For example, Michael Joseph Winkelmann, known as Beeple, is an American digital artist, graphic designer, and animator who created an NFT that was sold for $69 million and became famous afterward.

 

Songs, albums, music, lyrics, and soundbites can all be transferred into NFTs, thus giving musicians the opportunity to spread their pieces to a whole different audience and taking the music industry to a new level just as Snoop Dogg did.

 

Long Story Made Short - NFT and Marketing

 

With the presence of social media and marketing, and the popularity of NFTs, artists and content creators are benefiting from enhanced media exposure and special perks on social media that motivate people to mint NFT items, buy NFTs from internet platforms, promote copyright or originality of digital assets, create memorable ad campaigns, collaborate with NFT creators, and build a community.

  

Some real-life examples of how Marketing is enhancing NFT fame include the billboards in New York City's Times Square that have been showcasing different digital art featuring NFTs. Another example is the cartoon ape that came from a website called Bored Ape Yacht Club and which went viral soon after its launch. This famous NFT ape was customized with unique color schemes, facial expressions, and outfits (i.e.: apes with leopard-patterned or rainbow fur, apes smoking cigars, or apes shooting laser beams from their eyes)  that caught people’s attention due to its fun way of creation that encouraged marketers and brands to start using it in their content and campaigns all over social media. 

 

 

Do you see yourself getting into the NFT world anytime soon, and do you think it is a good opportunity for people out there or not really?

 

Published on 2022-05-09
by Aya