What is an NFT?

What is an NFT? This is a very complex question, but I hope to give you a solid understanding. I won’t go into the details of the technology behind NFTs, it’s far beyond the scope of this podcast. What I want to do is help you understand what is an NFT and how the underlying technology is going to become part of your everyday life. NFT stands for Non Fungible Token. One of the core concepts is that each NFT is unique and ownership can be verified publicly on the blockchain. Think about a physical painting. The painting is unique and generally ownership is pretty straight forward. But there are times that things aren’t so clear cut. It is possible for a fake painting to be made so well that experts have difficulty determining which is the real painting. Ownership can also be brought into questions due to theft or any number of reasons. It’s not uncommon for amazing pieces of art to go missing for years and then pop up at a garage sale or something. With NFTs, the ownership is recorded on a public blockchain. Anyone at any time can go and see which wallet owns the NFT. Also, the full history of the NFT is visible on the blockchain, from creation to any and all sales or transfers. One thing to consider is that at this time, only digital assets are easily associated with NFTs, but I don’t think we are too far away from someone coming up with a way to utilize the same technology with physical items. Also, as our world becomes more and more digital, the interest in physical items is thankfully waning. Because of this public and secure way of showing ownership, there is a great interest in NFTs. Think of a dispute regarding the ownership of an NFT, all the owner would need to do is show that they own the associated wallet. This doesn't cover issues where there are other kinds of theft or scamming going on, I will cover this in another podcast. With the basic idea that NFTs are unique and secure, more secure than current systems, this leads to what can be done with NFTs. Think of a college diploma or a professional license or certification. There have been many cases where people lie that they have certain credentials or pretend to be another person. If a diploma was an NFT that you received when you graduated, no one would be able to make a fake diploma. On the blockchain, it would be easy to see that the only valid creator for the diploma is the University. A fake diploma NFT would not have the same creator and would easily be found to be fake. What I want you to take away from this, is that we are at the very beginning stages of what an NFT can be. Right now it’s art, bubbling up right now is music, but in the next few years it will be everything. Every contract, every movie ticket, every receipt from every transaction will become an NFT. My goal isn’t that you go out and buy a long long cat or chonky boi, even though they are awesome, my goal is that you take the time to learn about NFTs so that you can be prepared for the next steps.