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WTF is an NFT?

NFT, in short, is an abbreviation for Non-Fungible Token. They might be familiar to you only by name, as they’ve gained a massive amount of publicity recently. However, the name doesn’t reveal much to someone who’s not familiar with the concept, so what are they really?

The following piece does not include any investment advice. It is worth noting that investing in any digital asset includes risks, which should be carefully assessed before making important decisions.

What are NFTs and how do they work?

NFTs are tokens that are launched on a blockchain. There’s a wide selection of different types of NFTs. They can be made out of photography, art, music, videos, tweets, and even memes.

NFT isn’t the photo or the tweet itself, since those can be downloaded and copied by anyone. NFT is a public proof of ownership. The lack of interchangeability (fungibility) distinguishes NFTs from blockchain cryptocurrencies, such as Bitcoin.

Fungible vs Non-fungible

Units of fungible assets, like Bitcoin (BTC) and EURO, can be interchangeably exchanged for one another. For example, two separate 5€ bills will always have the same value as one another.

NFTs, by contrast, cannot be interchangeably exchanged for one another. Like rare trading cards, each NFT is a digitally unique entity that has been created for a specific purpose. This means that NFTs are non-fungible assets.

You can use your Coinmotion wallet to purchase NTFs, for example, on OpenSea. If you don’t yet have a Coinmotion wallet, you can register to the platform using our code EZ4ENCE. CLICK HERE for more detailed instructions.

How do I buy an NFT?

The method of purchasing a non-fungible token depends on the NFT marketplace in which you will be making your purchase. Some NFT marketplaces may allow you to buy their tokens with credit cards; others will require that you use cryptocurrencies directly.

If the latter is the case, the type of cryptocurrency you will need to make the purchase will depend on the blockchain that the NFT has been created on.

For example, the OpenSea.io and Nifty Gateway marketplaces only sell non-fungible tokens that have been minted on the Ethereum blockchain. Therefore, to purchase NFTs on these platforms, you will need to use ETH tokens.

You can use your Coinmotion wallet to purchase NTFs, for example, on OpenSea. If you don’t yet have a Coinmotion wallet, you can register to the platform using our code EZ4ENCE. CLICK HERE for more detailed instructions. 

How do I store my NFT?

Storing your NFTs securely is vital for protecting your investments in the longer term. Some NFT platforms offer their users the option to keep their tokens on-platform. 

Therefore, NFT holders should consider a safer, self-custodied wallet. Depending on which blockchain your NFTs have been minted on, you will need a different kind of wallet. Some NFT marketplaces have integrated with crypto wallets that have browser extensions, like MetaMask.

Anytime that you create a crypto wallet of any kind, be sure that the seed phrase is visible to you and you only. Only create wallets with trusted providers. Ensure the site you are using to generate your wallet is not a phishing scam.

Original author: Rachel McIntosh

Check out in-depth articles about NFTs on Coinmotion
https://coinmotion.com/what_is_nft_non-fungible_tokens/
https://coinmotion.com/how-to-invest-in-nft/
https://coinmotion.com/how-to-earn-cryptocurrency-by-playing-games-welcome-to-the-leisure-economy/

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