5 Keys to NFTs, the new trend in digital art that generates millions of dollars

These digital works are not tangible, but they can still be valued in millions of dollars. What is it about? .

Cat gif protected with NFT

An NFT can be a work of art, a stamp, a letter, even a tweet, as long as it is in the digital ecosystem. Photo: pcmag

LatinAmerican Post | Juan Bacallado

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Leer en español: 5 Claves de las NFT, la nueva tendencia de arte digital que genera millones de dólares

At present, it is possible to pay hundreds of thousands of dollars for a digital file in formats such as JPEG, and although the work is still visible on the internet for any user, only one person has its certificate of originality that also guarantees that it belongs to them, that is thanks to the NFT, acronyms that mean Non-Fungible Token. And what token is that? Well, anything can be a work of art, a stamp, a letter, even a tweet, as long as it is in the digital ecosystem. As it is not fungible, it refers to the fact that it is not interchangeable since there is only one, it is not like for example a 100 dollar bill that can be exchanged for two of 50 and still be worth the same, the NFTs are unique and although there may be imitations Like any physical work of art, it remains unrepeatable and verifiable.

How does this work?

NFTs appeared in 2017 when two Canadian software programmers, Matt Hall and John Watkinson, created CryptoPunk, a website to trade images through the blockchain technology used by cryptocurrencies, which records transactions. In this case, NFTs usually use the Ethereum network, but unlike cryptocurrencies, NFTs are not fungible or interchangeable, but rather unrepeatable.

However, the blockchain system is what allows the tokens not to be imitated, since the original leaves a record stored in a decentralized way, that is, it does not depend on a specific entity or institution, instead it relies on thousands of computers so that anyone can access the registry and verify its authenticity, in addition to the fact that the buyer will have a certificate, either digital or physical, and although the author of the work still has the Author's Rights, the buyer will remain the owner.

Unbreakable and safe

It is already known that each token registered as NFT is unique, but in addition to this, they present another characteristic that makes it more secure. These assets must comply with a smart contract that consists of a programming code that guarantees their originality, but also this allows that they cannot be deleted or copied. But this NFT technology not only serves to sell digital assets but to safeguard your property. A creator will be able to register his asset as NFT and thus ensure its safekeeping as well as having the power to track it in case of sale.

How is the NFT market going?

Despite being a very recent business, this 2021 has evolved rapidly due to its popularization, to the point that during the first quarter of the year 2 billion dollars were registered only in the Ethereum network, a quite high figure if compared to the $ 94 million from the previous quarter, according to the WSJ. This 2 billion figure was not even expected by Erick Calderon, founder of an NFT project called Art Blocks, who assured the WSJ that "Where we are now, I expected to be in five years."

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Where are they bought?

Like cryptocurrencies, there are platforms intended for NFTs where creators publish and others buy, some are more exclusive than others, however, it is usually necessary for the people involved to have a digital cryptocurrency portfolio since transactions are made using cryptocurrencies. , mainly Ethereum and Bitcoin. Among some of these platforms is OpenSea, the most global and largest of all, with more than 4 million tokens and 200 classifications.

There are other open platforms such as Rarible, while there are others by invitation such as Zora, in addition, some auction houses have adapted and ventured into the NFT market, the best known is Christie's, founded in 1766 and where Leonardo da Vinci's arts have been sold. , Vicent Van Gogh among other important artists.

The most expensive NFT

When it comes to an auction house as prestigious as Christie's sold NFT, nothing less than a million-dollar transaction is expected. On February 25, 2021, the Christie's platform auctioned a digital work in JPEG format by the author Beeple, a popular NFT artist named Mike Winkelmann with 39 years of age, this work called “Everydays - The First 5000 Days” started with an estimated price of $ 100, however it would finish being sold on March 11 for $ 69,346,250 to a collector in Singapore, being the third most expensive work by a living artist.