Every year new buzzwords hit the technology industry as people grow more interested in what the latest developments can do for us. These days, two powerful terms are NFT and Blockchains. Both are strong examples of how far technology has come. Likewise, both can be a little bit confusing for people not in the know. Keep reading to get a better idea of how they work and why they matter.
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NFT and Blockchain Technology - Jason Solis
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NFT and Blockchain Technology
by Jason Solis | Oct 22, 2021 | FinTech, Jason Solis
Every year new buzzwords hit the technology industry as people grow more interested in
what the latest developments can do for us. These days, two powerful terms are NFT and
Blockchains. Both are strong examples of how far technology has come. Likewise, both can
be a little bit confusing for people not in the know. Keep reading to get a better idea of how
they work and why they matter.
What are NFTs?
NFT stands for non-fungible token. Admittedly, that single sentence probably doesn’t do a
whole lot to clear up any potential confusion on the matter. To put it simply, NFTs are
unique units of data (see blockchains to understand how this data is stored).
NFTs can stand in for any data that typically can be easily replicated – photos, audio clips,
videos, etc. The key difference here is that an NFT cannot be replicated – meaning that it is
one of a kind. That’s part of where the value of it comes into play.
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What makes NFTs interesting is that they are essentially a digital version of a certificate of
authenticity. Yet, they can prove ownership of both digital and physical items. The most
famous examples of this would be artwork, music, and even real estate.
What are Blockchains?
Conversely, a blockchain is a system for recording and storing information. What makes
blockchains unique, as opposed to any other storage method, is that it is virtually
impossible to change the data stored within. In other words, the data is protected no
matter what, even against hacker attempts.
Think of blockchains as a digital ledger of sorts. It can record transactions, provide digital
certificates of authenticity, and easily access data to all parties involved.
The Value of NFTs and Blockchains
Who doesn’t love the idea of selling a product for hundreds, if not thousands of dollars?
For some people, that dream comes to life thanks to NFTs. NFT sales have become
lucrative thanks to their unique status. People love owning something special. People love
it when they can prove ownership. NFTs happens to be an intersection of the two.
NFTs are highly sought after in the art world – where proof of ownership is vital. To provide
some context for how much people are willing to spend, Beeple sold a piece of digital
artwork for $69.3 million. While this is on the higher tier, it is far from uncommon these
days.
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