NFTs Explained For BEGINNERS! - YouTube

so let's get into it.

NFT stands for Non-Fungible Token.

Non-Fungible means that something cannot be exchanged for another item because it's unique.

For example, if Bob Ross and I were to paint some paintings,

both paintings wouldn't have the same value as each other.

They both have different traits and properties

about them that makes them unique to itself.

Whether it's the history or artist behind the work,

or what significance it has to others,

both are one of a kind and cannot be interchangeable.

Another instance would be if your mom passed down her wedding ring to you and you lost it.

Even if you bought the exact ring model from the jewellery store and replaced it,

it wouldn't be the same because it doesn't hold the historical value that the original ring had.

Fungible, on the other hand, can be replaced because it has the same value.

For example, I can give you a $20 bill,

and as long as you give me another one,

the value doesn't change, and they can be swapped.

So what exactly is an NFT, then?

NFTs are digital assets that live on the blockchain

and show proof of ownership over every single item.

Why is this important?

Because everything lives on the internet,

people are able to save and distribute files at a push of a button,

making it hard to know who the actual owner is of these assets.

NFTs solve this by using blockchain technology.

The blockchain logs everything that happens in the existence of that specific NFT.

From when it was created or minted

to every time it was bought or sold all the way to the current owner.

This information combined with the digital file makes every single NFT,

one of a kind with its own history and information.

And the best part is that because of the blockchain,

any information log can never be tampered with.

Okay, so why should you care about any of this?

Because we're currently at a point where all of your information,

all of the assets that you think you own, like your videos,

pictures, and social medias, are fully controlled by the mega-companies like

Facebook and TikTok.

This is the current stage of the internet known as Web 2.0.

NFTs give the power back to the users

and allow them to have digital, undeniable proof that they own rights to that asset.

This is a part of the new era of the Internet called Web 3.0,

where concepts of decentralization and greater user utility use is implemented!

Some say that NFTs give you digital bragging rights,

but there's so much more to it than that.

Aside from digital art, NFTs can also be used to sell movie tickets,

domain names, in-game items, real estate, digital real estate,

basically, anything that's unique and needs proof of ownership.

For example, if a concert were to sell tickets as NFTs,

this would eliminate the problem of counterfeits completely.

Every NFT ticket would be tracked back to the company

to prove his authenticity and state exactly who owns that NFT.

Anyone that tries to copy your screenshot that same ticket

will show no evidence that they are the owner,

revoking them of receiving any utility.

In this case, they wouldn't be able to have access to the concert.

This same concept is already applied in games that we play today, like Fortnite.

If you were to play Fortnite and screenshot a picture of a skin,

the system wouldn't register that as proof to allow you to use it in-game.

You would need to own the actual asset to be able to use it.

Now take this and add NFTs to the mix.

Instead of owning it in-game,

you're able to sell it outside of Fortnite

and actually, be able to make profit off your own purchases.

An NFT can even be programmed to give royalties to the creator

every single time that there's a secondary sale.

For example, if I were to sell an NFT painting to you for $100,

and you were to sell it for $1,000,

I would then get a percentage of that sale

and continue getting royalties from future sales, so on and so forth.

This brings a huge financial opportunity to artists

that have struggled to earn money for their craft

they have worked tirelessly on their entire lives.

I hope all of this makes sense,

but I know some of you guys are curious

about why some NFTs are worth millions of dollars?

Like this CryptoPunk that sold for $4.37m,

or this Bored Ape that sold for $3.4m.

Well, their worth is determined by what people are willing to pay for it.

If I'm willing to pay $10,000 for an NFT of a cat,

then it's worth $10,000.

Prices are driven by demand.

So if everyone wants to buy an NFT, it's worth whatever they want.

But on the flip side, if no one wants to buy the NFT, it's worthless.

A ton of factors affect what people are willing to pay for something,

whether it is historically valuable by being the first of its kind,

or if it has a crazy utility like free invitations to Yacht Parties with celebrities and billionaires,

or if the artist or creator is someone that a lot of people look up to.

Alright guys, that's pretty much the introduction to NFTs.

If you enjoyed this, make sure you subscribe to the channel,

where I'll be posting tonnes of tutorials,

shows with super smart people to teach you guys more about NFTs and Web 3.0,