If you don't know the difference between the NFL and an NFT, here's a helpful primer.
NFT is an abbreviation for the term "Non-Fungible-Token" and is essentially any piece of digital art that has a unique signature, numerical value, or designation on a blockchain or database. The reason they are "non-fungible" is that no two people can possess the same piece of art with the same designation.
It isn't necessarily the image or artwork that is unique; it is the coding that identifies the piece and makes it completely unique. Since their inception, NFTs have become controversial, valuable, and unmistakable touchstones in financial culture and in the global vernacular in general. So what makes an NFT valuable, and what should you look for if you want to start buying them?
Valuations
NFTs are essentially digital art, and therefore, anyone can identify any single NFT or series of NFTs as valuable with their buying power, just like any other type of art. This is important to remember because different people will tell you different things about NFTs as far as valuation. I won't say that it is completely arbitrary, but it is certainly based less on the "financial markets" and more on individual perspective and collective buying power. Some NFT collections are in themselves very valuable, and some are not as valuable as a whole, but do contain single pieces that are worth a lot.
Buying NFTs
Buying NFTs is very easy and straightforward. You can buy them on a site called OpenSea or straight from the artist's websites if you prefer. They often accept multiple forms of payment such as exchange of actual NFTs, crypto and straight cash. You never know what NFT will hit the big time, so if you're looking to make money, diversification and research will help you.
As with investments of any type, personal interests are often the determining factor in where people put their money.
Some NFTs have specified rarity algorithms that govern their creation, so keeping an eye out for certain traits may lead you to getting your hands on a very rare type, which could become very valuable. At the end of the day, you could diversify your portfolio if you want to invest, or just buy some cool-looking pieces if you want to own a piece of history.
Produced in association with MetaNews.
This story was provided to Newsweek by Zenger News.
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