The term NFTs has recently been associated to images of apes or “millionaire” teenagers, often degrading its actual nature and potential use cases. But what NFTs really are? Let’s start by its definition.
The term NFTs has recently been associated to images of apes or “millionaire” teenagers, often degrading its actual nature and potential use cases. But what NFTs really are? Let’s start by its definition.
NFTs are non-fungible tokens, which in essence means unique tokens which are recorded in a blockchain. Alright, all NFTs are different from each other, there are no 2 NFTs which are exactly the same, easy to understand. Now what are tokens? In simple terms, we can think of a token as a piece of information which is recorded on a blockchain, immutable and easily transferable.
To make things easy to understand, imagine you just wrote an article in a word file and you want to save it. Now, instead of saving it in a computer, let’s say you save it on a blockchain, which is a sort of a decentralized database. Well, that article you just saved on the blockchain would be an NFT, it will aways be recorded in the blockchain, eternally, immutably, and only you will own it, unless you transfer the ownership to another person.
Although the first and most famous NFTs represented images, most often animals´ cartoons, they can actually represent different sort of data such as sound or animations. JPG, PNG, GIF, SVG, MP4, WEBM, MP3, WAV, OGG, GLB, or GLTF are some of the files´ formats you can create NFTs with and, with this, the number of possible real world use cases are numberless.
The explosion of the NFTs market in the form of jpegs we have experienced in the recent years is just the tip of the iceberg of what is to come in the future, not in terms of speculation or investment assets, but in regards to the huge number of potential applications it can lead to. NFTs can revolutionize data industry, help to solve problems related to authenticity or open a new door of opportunities to content creators.
The development of the metaverse and web3 will grant NFTs a great deal of use cases and we think it will be then when mass adoption will be inevitable. In 3W Labs, we are happy to guide organizations on how to adopt this new technology in a way which fits its current business models, sustainably and having a positive impact on the reputation of the brand.
