NFTs: Why Are They Needed, And Do They Have Any Value?

It’s time to learn with WhiteBIT and WOO Network!

WhiteBIT is the biggest European centralized cryptocurrency exchange with over 3 million users worldwide. The platform offers 450+ trading pairs with popular assets. 30+ of them are pairs with various national currencies. The average daily trading volume on the exchange is $1 billion.

WOO Network is a liquidity network that includes WOO X centralized exchange, WOOFi decentralized exchange, WOO DEX on the NEAR blockchain, and liquidity as a service. All these parts are united by the WOO token. The company aims to provide the most profitable trading at low or zero prices.

This article will help you learn about non-fungible tokens, where they are traded, and what advantages they have. Based on the materials of the articles, a quiz will be held, in which everyone will have a chance to get their NFT.

The global non-fungible token (NFT) market was valued at $15.70 billion in 2021. Newspapers are full of headlines about celebrities buying or releasing NFTs. Today’s market offers thousands of JPEGs, the most expensive of which sold for $68.3 million. Let’s see what NFT is!

What do we know about NFTs?

NFT is a non-fungible token created on a blockchain. Such a token is a unique thing and exists in a single copy. Unlike fungible tokens such as bitcoin (BTC) or Ethereum (ETH), they cannot be divided and partially sold. NFTs are created using smart contracts on blockchains such as Ethereum, Solana, NEAR, Polkadot, and others.

However, NFTs are more than just blockchain tokens. They include blockchain data and metadata such as media files, description, Content ID, and JSON. The token description, smart contract address, content ID, creator address, and transaction history make it impossible to duplicate or fake NFTs.

Let’s look at the example:

NFT

Here is one of the pictures of the popular Boared Ape Yaught Club collection.

What you see in front of you is the image copied by the right mouse button for this article. The NFT that stores information about this image looks like this:

NFT

Description of NFT Bored Ape Yaught Club #2

It is essential to know that NFTs can be more than just pictures. They exist in the form of audio, video, social media posts, land in the metaverse, or other unique credentials.

How did NFTs appear?

All currently popular collections are the successors of the CryptoPunks project, created in 2017 not in the NFT format but as separate tokens on the Ethereum blockchain. Each of the 10 000 tokens in the collection is unique.

Each of the collectible punk characters has attributes of varying rarity. These attributes include background color, skin or eye color, accessories, etc.

Such attributes are called traits. The price of a token largely depends on whether its description contains a rare trait.

Why are NFTs needed?

To understand the nature of NFTs, we propose the following classification, which is based on whether the token is used in the blockchain ecosystem or in the real world.

NFTs, whose nature is closely related to blockchain projects, usually give privileges within their ecosystem or indicate status in the community. They can be used as collateral, provide access to private clubs, or record merits on the blockchain. They are:

avatars: Bored Ape Yaught Club, Meebits, Bulls on the Block, Cool Cats NFT, CLONE X;
gaming NFTs: Axie infinity, Crypto Kitties, STEPN;
land in the metaverses: Decentraland, The Sandbox;
blockchain data: Project Galaxy.

One of such NFTs can be obtained from WOO Network. Gifts or rewards may be provided to holders of these NFTs in the future. You can participate and collect NFTs on the Project Galaxy website.

Non-blockchain NFTs are tokenized items or data and give the right to own them.

Tokenization converts the rights to own an asset into a digital token on the blockchain.

They are:

pictures and videos;
music tracks and albums;
clothes and accessories;
sports club cards;
autographs;
precious metals and stones.

So what is the value of NFTs?

The price of a token depends on its rarity and the use cases. To objectively evaluate an NFT project, you need to ask yourself: how useful will it be to you in the future? Will it give a membership in a closed club, the right to have VIP access to something or an Airdrop of a cryptocurrency that has not yet been created? DYOR!