What is NFT :-
Now a days , you probably heard about NFT's and it's hyped . Have you ever wondered what that NFT is ? Let us make you clear with that .
NFT stand for Non Fungible Token that gives you the ownership of an unique digital asset that stored in a digital form . Makes you more confusing, right ?
Let us first understand what is Fungible and non Fungible asset then .....
Fungible and Non Fungible Assets :-
In terms of economy , Fungible Assets can be interchanged with same values , for example ; a twenty rupees note can be interchangeable with two number of ten rupees note . The value would be same as before . But , Non Fungible Assets like , the painting of Monalisa or pyramid of Giza are non Fungible itself because they are more precious than we thought . They are precious for their uniqueness , because there only one piece is available of it . Non Fungible assets often count as collectors item , as they are only one or a few .
How NFT's are Non Fungible :-
As the name stands itself as Non Fungible Token , let us understand how and why is it unique ?
Have you ever heard about that 10 sec of video clip that sold for 6.6 million dollar or around 48 crore rupees ! Wondered .. yeah ... Some digital asset , that could be simply an image , a video clip , a gif or digital art is unique by itself , that means they are only one in the world . People are crazy about owing that stuff to be so unique . Here comes the NFT with its true meaning . It allows the creator to impose his or her ownership on the item and later he or she may sold it to another one and make some money .
How NFT works :-
NFT basically works on the block chain mechanism , yes the same technology that makes run the crypto currencies like etherium , Bitcoin etc .
Selling or buying those stuffs now only be possible through crypto exchange only , for that simply you need to hold some crypto currency and the access of the platform where the art piece is available .
Pros and Cons -
Come to the pros ,
Its highly in demand , people are crazy about to be unique . A million of copies may available in the web , but the original still exists with you only which you call sell .
It makes a lot of money more that your imagination , if in demand .
So , what about cons :-
The value of an NFT can't be decided with fundamental analysis or technical analysis , it just depends on demand and scarcity . The more it is in demand the more price you will get for it .
Some time artificial scarcity can be created by cutting the supply . The scarcity makes its price hike . And last but not the least , the trend can be outdated ..
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