What is NFT Marketplace?

The WazirX, one of the leading cryptocurrency exchanges has recently launched India’s first market place for NFT. NFT is Non-Fungible Tokens. The launch will now allow Indian creators to place their digital assets (such as images or videos, music, etc) for auction and earn royalty.

What is Non-Fungible Token?

It is a unit of data on a digital ledger called a block chain. Every NFT data represents a unique digital item. It can be audios, art, videos, video games or other forms of creative works. Now the question arises if a painting can be placed for auction here? No. Only those things that can be used simply by buying or downloading online can be placed here for auction. If an art work has been created using computer, then it can be placed here for auction.

The NFTs, that is, the digital assets in these block chains can be bought from NFT markets. One such market has now been established in India. In this system, the access to the copies of the original file is not restricted to the owner of the token. As the digital files are infinitely reproducible, the NFTs representing them provide the buyers with proof of ownership of the NFT.

How is NFT different from cryptocurrency?

A NFT is a cryptographic token. However, unlike cryptocurrencies, the NFTs are not mutually interchangeable, that is, not fungible.

How is NFT created?

NFT is created when a file of art work is uploaded to the NFT auction market. From then on, the file can be bought and resold with crypto currency.

Blockchains used in NFTs

NFTs were first created on Ethereum standard. The other block chains used to create NFT assets are Flow and Tezos. However, there has been constant criticism that Ethereum and Bitcoin networks consume high electric power.

Month: Current Affairs - April, 2021