Learn the basics about NFTs
You may have heard the acronym NFT - what are NFTs and how are they used? In this tutorial you'll learn what NFTs are and how you can explore or purchase an NFT.
If you haven't yet learned about how to set up an ethereum wallet with Metamask, you'll want to start there.
First, what does NFT stand for? NFT stands for Non-Fungible Token. If something is fungible it means the units are essentially interchangeable, so one-dollar bills are an example of something that is fungible. A dollar is the same as any other dollar.
Non-fungible tokens mean they are unique. The best way to understand them is first to look at the analog counterpart.
Say you have a collection: maybe you collect baseball cards, or coins, or comic books or shoes. This is just an example of a collectible-- something which is unique, or limited, and may have some cultural, personal, or sentimental value.
Usually in the digital realm, you can copy things easily so it is hard to create scarcity. NFTs are essentially digital collectibles, like digital baseball cards, and a way to represent, buy, sell, or transfer digital ownership.
NFTs can be useful to represent unique digital items, digital ownership, or a digital collectible.
One example would be digital baseball or basketball cards. The app NBA Top Shot is an NFT app that lets people buy or trade digital collectibles in the form of highlight videos. Now, if you own an NFT, does that prevent anyone else from using that image? No, and that is one of the confusing things about NFTs. Being the owner of the NFT is being the owner of that token, which may represent some other item. But if it is an image, anyone can still view or download that image.
An early example of NFTs was called CryptoKitties, which was digital collectible cats. CryptoKitties have various properties, and could be traded or used in various games.
Another example of NFTs could be digital art. People could create unique digital artworks and sell them using NFTs.
Another example of NFTs would be as virtual game items. Virtual game items have existed, but usually just in the universe of the game company. This allows them to be traded more easily, or even be used between applications. An example of a game using NFT game items is called Axie Infinity.
Another example of NFTs could be domain names--which are unique digital items where you want to know who owns them. These are used in the Ethereum Domain name system.
One last example would be virtual tickets. If you have a virtual ticket NFT, you can prove it is authentic, and easily buy or trade it on an NFT marketplace.
These are just a few ideas, but there are lots of unexplored possibilities with NFTs.
If you want to see a couple examples of NFTs, we purchased the NFT for the ethereum name codehs.eth, and we created limited edition Hacker Karel NFTs. There are only 100 of them and they live on the Ethereum blockchain. You can view those here: https://rainbow.me/codehs.eth.