Will NFT become a breakthrough cryptocurrency like bitcoin

NOTE: The actual contents and opinions are the sole views of the author who maintains editorial independence. A few months ago there was a boom in the popularity of NFT tokens. Artists and investors were drawn to the digital space much like everyone else. Аccording to the Protos website , interest in NFT fell by 90% in May.

Why NFT is a blockchain and what are its features

Any kind of data can be written in a blockchain, including those associated with non-interchangeable tokens. NFT (non-fungible token) is just a registered entry within the blockchain.

In this case, the blockchain acts as a warrantor of the uniqueness and originality of the digital object. The unique feature of the NFT-token is the increase in its value depending on regular mention and use.

What are the similarities and differences between NFT and other cryptocurrencies?

The storage of owner information and transactions involving NFTs in blockchains makes these tokens similar to other cryptocurrencies. They also pass from one user to another, and access to them is secured with a key. But there are differences between NFT and other cryptocurrencies, and they are significant.

Read: Ethereum: all about the second most popular cryptocurrency

One bitcoin is no different from another, while NFT is considered non-interchangeable for a reason. In the digital world, no two NFT tokens are the same. They prove the authenticity of digital objects and works of art. An NFT can store information about the authenticity of a painting, its owner, or the price for which it was purchased.

The NFT-token itself does not store anyone’s creative product: pictures, music, or paintings, for example. Only their characteristics are stored in it, which reveals their uniqueness and value. Through NFT it is possible to record not only digital but also physical objects.

The differences between NFT and offline purchases of art objects are no less striking. A conventional purchase involves serious risks and high costs. By buying a digital asset, you can choose to work as a talented newcomer.

Read: Best Free Crypto Wallets In 2022

Why NFT is dependent on another crypto

The NFT token plays the role of a digital shell that solves the copyright issue. But to trade it, you would need to choose NFTs on an online virtual marketplace.

Their value is stated in “ethers” – Ethereum cryptocurrency coins. NFT depends on interchangeable cryptocurrencies because it is the only way to profit from or invest in Non-Fungible Tokens.

As soon as a full-fledged legal framework is formed, it will be possible to say that NFT is a new stage in the development of not only cryptocurrencies but also the institution of intellectual property.

Read: Bitcoin investor forgets password and loses access to $220 million

Can NFT become a breakthrough cryptocurrency like bitcoin?

That’s a tough question to answer. Four months ago, there was a boom in the popularity of NFT tokens: artists, designers, creators of other art objects, and investors streamed into the digital space. An NFT token sold for a record $69.35 million at a Christie’s auction.

Not long ago, crypto-news site Protos acknowledged that interest in NFTs dropped more than 90% during May. Steady interest was maintained in collectible cards: during the first week of June, investors bought them for more than $9.2 million, which was about half of the total amount of all NFT transactions during the same period.

There has been a synchronized decline in the active use of NFT wallets as well. While at least 12,000 were used for transfers last month, by June 2 that number had dropped by 70%: funds received through the purchase or sale of non-interchangeable tokens were moving between only 3,900 wallets.

But claims that “the NFT bubble burst much earlier than crypto investors expected” can be confidently called groundless. Undoubtedly, the first wave of interest in non-exchangeable tokens waned: many creators of creative content and potential collectors realized that they still know too little about this niche and do not want to commit rash actions.

We can all sell our own creativity, but NFT online platforms are rather interested in musical and visual content creators.  like photographer Justin Aversano. He has teamed up with Nicole Buffett, Warren Buffett’s granddaughter, to invest in emerging talent, earning a percentage of the work they sell.

Can non-interchangeable tokens be considered as a tool to form an investment portfolio? It is important to keep in mind that NFT cannot be considered a classic cryptocurrency in its usual sense. These are high-risk investments, in which experts advise you to invest no more than 10% of the total amount of your investments. There may be more than one boom of interest in NFT, but for now, this is a very recent crypto market sector whose “rules of the game” are still under active formation.

Read: Is Crypto Signal Legit and How Can You Benefit From It

A separate role in strengthening NFT’s position in the crypto market should be played by platforms that bind  blockchain technology with the art world. The Art Exchange is poised to be a trailblazer: it has been involved in the digital art world before, offering services at the intersection of creativity, financial technology, and blockchain.

With The Art Exchange, it was possible, for example, to enter into contracts similar to futures, or to predict the value of art objects in a few years. On June 15, The Art Exchange launched a unique project: the company will produce NFTs by contemporary artists. It will work in the format of weekly drops.

Why are there high expectations for the new blockchain platform? The Art Exchange introduced its mobile wallet with the cryptocurrency DAI (stablecoin). It is pegged to the dollar exchange rate and it is assumed that this choice will ensure the democratization of sales in NFT and, therefore, create prospects for the conquest of non-exchangeable tokens to new heights.

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