What happened in March 2021? An NFT artwork sold for sky-high prices
2021/3/12, at Christie’s auction site, there was an encrypted artwork Everydays: The First 5000 Days. Until the last two hours of the auction, bidders continued to flood in, and finally paid 70 million U.S. dollars (approximately NT$1.9 billion). The astronomical price of yuan) hit the hammer, setting the highest price in the NFT art market.
This also allowed Beeple, the author of this work of art, to be promoted to one of the three most valuable living artists in the world. It also makes the world aware that the original purely digital works will replace physical works and become tools that can be invested and preserved in value.
What does NFT mean? When you read this article, first of all congratulations. This means that you have opened the door to the "coin circle" and are one step closer to investment opportunities. As for how to trade NFT products? Where to trade? You can refer to this article- NFT platform introduction .
Contents:
1 What is NFT?
2 NFT agreement ERC-721 / ERC-1155
3 NFT anti-counterfeiting, confirmation, legal
1 What is NFT?
First of all, Bitcoin (BTC) and Ether (ETH) that we often hear are homogenized tokens, and NFT is a non-homogeneous token. Let's take a look at the characteristics of these two terms?
-Fungible Token:
1. Fungibility: Each cryptocurrency has the same value and the same function. The BTC in my hand is the same as the BTC in yours. It can be exchanged at will, and it can be used for trading without a separate price.
2. Severability: Continue to use BTC as an example. The price of a BTC currently exceeds 1 million Taiwan dollars, but the amount at the time of transaction is often less than 1 Bitcoin. At this time, we can choose to trade only 0.1 BTC, or 0.00001 BTC does not need to be traded in integers and can be split infinitely, which is the divisibility of homogenized tokens.
3. Consistency: Due to the above two characteristics, it has the same recognized value as the legal currency used daily, but it does not need to have different denominations of legal currency banknotes. It supports split transactions and makes homogenized tokens usable for transactions. Good choice.
-Non-Fungible Token (NFT, Non-Fungible Token):
1. Not substitutable: Each NFT is unique and irreplaceable. For example, the master tape of Seiko Takahashi must be unequal to the master tape of the young actress who just debuted, nor can it be replaced by other actresses.
2. Not divisible: If the master digital file of Takahashi Seiko is a NFT token, this token cannot be divided into smaller units for trading, and the unit of each transaction is one, which means that you get this NFT people have a complete mastering of all parts of Takahashi Seiko.
3. Uniqueness: Due to the above two characteristics, the NFT of the "Takahashi Sage Master Band" also has anti-counterfeiting functions and is a digital collectible that can be circulated.
2 NFT protocol ERC-721 / ERC-1155
When I introduced the Little Fox MetaMask cryptocurrency wallet before, I mentioned ERC-20, which is the earlier token specification protocol of the Ethereum blockchain . For example, there are two tokens on the Ethereum platform that are issued with ERC-20. , The two tokens can be exchanged freely, and the tokens here refer to homogenized tokens.
What is Smart Contract?
In one sentence, a smart contract is a "special agreement that can be automatically executed on the blockchain". To put it bluntly, a smart contract is a string of program codes on the blockchain. When special conditions are met, it will be triggered to execute , Neither is smart, nor is it a contract, nor is it legally beneficial.
Since the code on the blockchain will not be tampered with, fully open and transparent, and will not stop operating, it means that no one can change the content and execution of the smart contract. The value of the smart contract is to provide better protection and enforcement for both parties to the contract. , Ethereum Developer Agreement ERC (Ethereum Request for Comments) is a smart contract.
What is ERC-721?
If ERC-20 is used to issue a general homogenized cryptocurrency, ERC-721 is the first standard protocol for non-homogeneous token NFT in Ethereum. Compared with ERC-20, ERC-721 has more diverse application scenarios. , Including games, intellectual property, physical assets, identification, financial documents, ticketing, etc. ERC-721 was created by Dieter Shirley, CTO of CryptoKitties, and is currently used in CryptoKitties, Decentraland and other projects.
The tokens issued through ERC-721 are non-homogeneous tokens, and it is ERC-721 that gives the non-homogeneous token NFT uniqueness. All digital assets: paintings, bonds, houses or cars, in ERC-721 Under the agreement, the security of ownership, the convenience of ownership transfer, and the immutability and transparency of ownership history can be guaranteed.
In addition to ERC-721 and ERC-20, the future development of blockchain will not leave another growing protocol ERC-1155.
What is ERC-1155?
At present, whether it is the homogenized token agreement (ERC-20) or the non-homogeneous token agreement (ERC-721), when creating a token, each requires their own independent smart contracts. For example, game developers may need to create thousands of token types. If the old independent token protocol is used, it will not only limit the interaction between tokens, but also consume a lot of resources on Ethereum.
Through ERC-1155, smart contracts can transmit multiple types of tokens at once. In addition to saving gas fees, multiple types of tokens can also be directly traded based on this protocol, without the need for individual tokens to approve different independent ones. Only after the contract can be traded, the interaction between assimilation tokens and non-homogeneous tokens can be directly carried out.
3 NFT anti-counterfeiting and confirmation
Because NFT has the above-mentioned uniqueness and inseparability characteristics, some areas of NFT are very suitable, such as artwork, games, electronic deposits, and identity authentication. In addition to the cryptographic confirmation of assets (asset identity confirmation) through NFT, the trust problem can be solved. On the other hand, traditional physical assets have passed such authentication, which greatly improves the liquidity of assets and integrates painting, calligraphy, sculpture and other arts. The products are stored on the blockchain in the form of NFT, which not only strengthens the anti-counterfeiting requirements of the collectibles, but also improves the efficiency of physical rights confirmation and transaction circulation.
Our conclusions about the future of NFT:
When it comes to NFTs, most people think of games, artworks, and collectibles. This is still a niche market, especially IP-type NFTs, whose value basically corresponds to the value of IP in the real universe. The valuable IP in the real universe naturally has the advantage of being easy to circulate and being accepted by the next buyer; the IP that originally had no value in the real universe may also end up with no buyer accepting it for 1 yuan. And when the price of IP-type NFTs has been hyped up to a certain extent, this type of NFT will lose its advantage in trading circulation.
NFT has unique attributes, allowing NFT to be more widely used in specific scenarios and services. For example, Yinsure Finance uses NFT tokenization for insurance services. Each insurance policy is an NFT token. In addition to holding it on its own, these tokens can also be used to trade on platforms such as Opensea and Rarible .
