What is NFT?
Non-Fungible Token(NFT)
A non-fungible token (NFT) is a virtual token that uses blockchain technology to prove ownership of a digital asset. It is used to indicate unique originality and ownership by putting an address in the token that points to a digital file such as a photo or video. In other words, it is a kind of virtual certificate of authenticity.
Non-fungible tokens are unique and similar to non-identical citizenship cards. NFTs are guaranteed unique by permanently leaving transaction details on the blockchain.
NFT History
The stage when the concept of NFT was established and the first NFT was prototyped. As Bitcoin became more popular, attempts were made to develop blockchain technology inspired by Bitcoin. After this attempt, the world’s first NFT called “Quantum” was created in 2014. This is the first case where the idea and practical technology of recording video on a blockchain and verifying the author and ownership are utilized.
After that, Vitalik Buterin devised Ethereum, which could run perfect computer programs on the blockchain, and as its popularity grew, various applications were created on top of Ethereum. In its early days, Ethereum was primarily used as a platform for issuing different tokens. In order to issue a new coin without using Ethereum, a huge design including a mining methodology was required. Innovative and easy token issuance. Solidity language. Also, issuing tokens on Ethereum has made it easier to raise funds on Ethereum. Thanks to these advantages, Ethereum will spawn many other coin projects and trigger an ICO boom in 2017.
Ethereum’s token issuance was originally intended only for fungible tokens that can be combined like money. This was established as a standard called ERC-20 and has come to be widely used. In June 2017, Lava Labs modified ERC-20 and issued 10,000 individual tokens. This gave each token a unique human-shaped icon. This is the origin of the Cryptopunk Non-Fungible Token. Cryptopunk was the project that inspired the creation of the non-fungible token that was later called ERC-721, and this is where NFTs really began.
Independence
Since existing files consist of only data, they can be easily copied without permission, and copy protection technology using DRM was also finally distributed using a centralized management server, so strictly speaking, a completely independent individual was difficult to consider as the property of
On the other hand, NFT is not controlled by anyone using blockchain technology and has a uniqueness that cannot be reproduced, so its rarity can be fully recognized and it is relatively safe. As a result, various digital assets, including various works of art, have been created and traded as NFTs. Guarantees are sometimes built into NFTs to prevent counterfeit transactions.
However, the meaning of NFT, which is mainly used now, means a digital asset and a token that proves it, but NFT itself means an irreplaceable token. For example, one Bitcoin is a token that can be replaced with another Bitcoin (Fungible Token) with the same value, but each NFT is a non-fungible token, so it is only used for artwork. NFTs can be applied not only to artworks, but also to various game items or used for limited edition distribution.
Permanence
For digital assets tagged as NFT, the owner and transaction history of the work are recorded with blockchain technology, and due to the nature of the technology, it cannot be tampered with or changed by others. Even if the same digital file is replicated as an NFT, it will eventually be a different NFT from the existing NFT, so it will be distinguished from the genuine product created by NFT. If the future recognizes the value of NFTs in the art world, the value of NFTs that have been created for a long time is expected to increase dramatically, so as of 2021, transactions equivalent to speculation are being conducted.
NFT persistence facilitates asset creation and proof of title. NFTs can generate strong authentication tokens with a very simple computational effort. If you want your NFT to be a real work of art, take a picture with your digital camera or use a 3D scan to create a digital file and attach your NFT. This effectively addresses concerns such as copying, tampering, and manipulation of odds and statistics, even when anyone can create similar digital assets within a shared platform such as a game. This is because the uniqueness of NFTs is easily recognizable. In the art market, not only reproductions of works of art but also forged certificates are occurring frequently. NFTs, on the other hand, block certificate forgery because the record of each certificate is verified through the blockchain. In other words, when used as a certificate, which is the original purpose of NFT, it provides strong security by taking advantage of blockchain. As an example, the above-mentioned privilege NFT is used like an owner’s membership system.
