What is NFT? 2 minute to understand the concept of NFT

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What is NFT?

The full name of NFT in English is Non-Fungible Token, which is translated into Chinese as: non-fungible token, which is indivisible, irreplaceable and unique.

On the blockchain, digital cryptocurrency is divided into two categories: native currency and token. The former, such as BTC, ETH, etc., have their own main chain and use transactions on the chain to maintain account data; tokens are attached to the existing blockchain and use smart contracts to record the account, such as attached to Ethereum The token issued from above. Tokens can be divided into two types: homogenization and non-homogeneity.

Homogeneous tokens, namely FT (Fungible Token), can replace each other and can be close to infinitely split tokens. For example, there is essentially no difference between a BTC in your hand and a BTC in my hand. This is homogenization and homogenization of coins.

Non-homogeneous tokens, namely NFTs, are unique and inseparable tokens, such as encrypted cats, tokenized digital tickets, etc. It is equivalent to a numbered USD, and there will be no two USD with the same number.

Therefore, compared with FT, the key innovation of NFT is to provide a way to mark the ownership of native digital assets (that is, assets that exist in the digital world or originate in the digital world), and this ownership can exist in centralized services Or outside the centralized library. The ownership of the NFT does not prevent others from inspecting it or reading it. NFT does not capture the information and hide it, it just captures the information and discovers the relationship and value of the information with all other information on the chain.

At the same time, due to its non-homogeneous and inseparable characteristics, NFT can anchor the concept of commodities in the real world. Simply understood, it is a digital asset issued on the blockchain. This asset can be a game item. , Digital artwork, tickets, etc., and are unique and non-copyable. Because NFT has natural collection properties and is easy to trade, crypto artists can use NFT to create unique digital artworks.

There are many application scenarios of NTF. Games, ticketing, etc. are all its application areas. The specific application scenarios are as follows:

game. For example, it can be used as pets, weapon props, clothing and other items in the game. The smash hit crypto cat in 2018 uses NFT technology. They give each cat a special tag number to make it a unique cat.

The field of intellectual property. NFT can represent a painting, a song, a patent, a film, a photo, or other intellectual property rights. In this field, NFT plays the role of a patent office. Help each unique thing to register the copyright and help it identify the patent.

Physical assets. Real estate such as houses and other physical assets can be tokenized by NFT. It can be used in financial markets such as asset circulation.

Records and identification. NFT can also be used to verify identity and birth certificates, driving licenses, academic certificates and other aspects. These can be safely stored in digital form to prevent abuse or tampering.

Financial documents. Invoices, orders, insurance, bills, etc. It can be converted into NFT for trading.