WHAT IS A NON-FUNGIBLE TOKEN (NFT)?
Non-fungible tokens (NFTs) are cryptographic assets on a blockchain with unique identification codes and metadata that distinguish them from each other. The market for NFTs was worth a staggering $41 billion in 2021 alone, an amount that is approaching the total value of the entire global fine art market.
NFTs are bought and sold online, frequently with cryptocurrencies like the Earth Dollar, and they are generally encoded with the same underlying software as many cryptos.
Here are some of the characteristics:
- NFTs are unique cryptographic tokens that exist on a blockchain and cannot be replicated.
- NFTs can represent real-world items like Real Assets, including land, real estate, commodities, Natural Capital Assets, and artwork.
- “Tokenizing” these Real Assets and real-world tangible assets make buying, selling, and trading them more efficient while reducing the probability of fraud.
- NFTs can also function to represent individuals’ identities, property rights, and more.
- NFTs create digital scarcity.
Unlike cryptocurrencies, they cannot be traded or exchanged at equivalency. This differs from fungible tokens like cryptocurrencies, which are identical to each other and, therefore, can serve as a medium for commercial transactions.
The First 5,000 Days – $69 million. The First 5,000 Days is a digital artwork collage made by a veteran digital artist and graphic designer named Mike Winkelmann, also known as Beeple. Winkelmann started working on the collage in May 2007, posting art pieces continuously every single day for 13 years. The artwork was exclusively offered in Christie’s, an NFT auction house, which was bought for $69,346,250 by crypto billionaire MetaKovan as he saw Beeple as the “artist of the digital-native generation”. The sale also marked the first purely digital-work auction on NFTs where a cryptocurrency (ETH) was used as payment.
WHAT IS A NON-FUNGIBLE TOKEN (NFT)?
Non-fungible tokens (NFTs) are cryptographic assets on a blockchain with unique identification codes and metadata that distinguish them from each other. The market for NFTs was worth a staggering $41 billion in 2021 alone, an amount that is approaching the total value of the entire global fine art market.
NFTs are bought and sold online, frequently with cryptocurrencies like the Earth Dollar, and they are generally encoded with the same underlying software as many cryptos.
Here are some of the characteristics:
- NFTs are unique cryptographic tokens that exist on a blockchain and cannot be replicated.
- NFTs can represent real-world items like Real Assets, including land, real estate, commodities, Natural Capital Assets, and artwork.
- “Tokenizing” these Real Assets and real-world tangible assets make buying, selling, and trading them more efficient while reducing the probability of fraud.
- NFTs can also function to represent individuals’ identities, property rights, and more.
- NFTs create digital scarcity.
Unlike cryptocurrencies, they cannot be traded or exchanged at equivalency. This differs from fungible tokens like cryptocurrencies, which are identical to each other and, therefore, can serve as a medium for commercial transactions.
The First 5,000 Days – $69 million. The First 5,000 Days is a digital artwork collage made by a veteran digital artist and graphic designer named Mike Winkelmann, also known as Beeple. Winkelmann started working on the collage in May 2007, posting art pieces continuously every single day for 13 years. The artwork was exclusively offered in Christie’s, an NFT auction house, which was bought for $69,346,250 by crypto billionaire MetaKovan as he saw Beeple as the “artist of the digital-native generation”. The sale also marked the first purely digital-work auction on NFTs where a cryptocurrency (ETH) was used as payment.
UNDERSTANDING NFTs
Bored Ape #2087 – 769 ETH ~ $2.3 Million USD. The Bored Ape Yacht Club is a collection of 10,000 unique Bored Ape NFTs— unique digital collectibles living on the Ethereum blockchain. Your Bored Ape doubles as your Yacht Club membership card, and grants access to members-only benefits, the first of which is access to THE BATHROOM, a collaborative graffiti board. Future areas and perks can be unlocked by the community through roadmap activation.
Like physical money, cryptocurrencies are fungible, meaning that they can be traded or exchanged, one for another.
NFTs exist on a blockchain, which is a distributed public ledger that records transactions. You’re probably most familiar with blockchain as the underlying process that makes cryptocurrencies possible.
For example, one bitcoin is always equal in value to another bitcoin. Similarly, a single unit of ether is always equal to another unit. This fungibility characteristic makes cryptocurrencies suitable as a secure medium of transaction in the digital economy.
NFTs shift the crypto paradigm by making each token unique and irreplaceable, thereby making it impossible for one non-fungible token to be equal to another.
They are digital representations of assets and have been likened to digital passports because each token contains a unique, non-transferable identity to distinguish it from other tokens. They are also extensible, meaning you can combine one NFT with another to “breed” a third, unique NFT.
Just like Bitcoin, NFTs also contain ownership details for easy identification and transfer between token holders. Owners can also add metadata or attributes about the asset in NFTs. For example, artists can sign their digital artwork with their own signature in the metadata.
Specifically, NFTs are typically held on the Ethereum blockchain, although other blockchains support them as well.
NFTs evolved from the ERC-721 standard. Developed by some of the same people responsible for the Ethereum ERC-20 smart contract.
ERC-721 defines the minimum interface—ownership details, security, and metadata—required for the exchange and distribution of the NFTs.
The ERC-1155 standard takes the concept further by reducing the transaction and storage costs required for NFTs and batching multiple types of non-fungible tokens into a single contract.
UNDERSTANDING NFTs
Like physical money, cryptocurrencies are fungible, meaning that they can be traded or exchanged, one for another.
NFTs exist on a blockchain, which is a distributed public ledger that records transactions. You’re probably most familiar with blockchain as the underlying process that makes cryptocurrencies possible.
For example, one bitcoin is always equal in value to another bitcoin. Similarly, a single unit of ether is always equal to another unit. This fungibility characteristic makes cryptocurrencies suitable as a secure medium of transaction in the digital economy.
NFTs shift the crypto paradigm by making each token unique and irreplaceable, thereby making it impossible for one non-fungible token to be equal to another.
They are digital representations of assets and have been likened to digital passports because each token contains a unique, non-transferable identity to distinguish it from other tokens. They are also extensible, meaning you can combine one NFT with another to “breed” a third, unique NFT.
Just like Bitcoin, NFTs also contain ownership details for easy identification and transfer between token holders. Owners can also add metadata or attributes about the asset in NFTs. For example, artists can sign their digital artwork with their own signature in the metadata.
Specifically, NFTs are typically held on the Ethereum blockchain, although other blockchains support them as well.
NFTs evolved from the ERC-721 standard. Developed by some of the same people responsible for the Ethereum ERC-20 smart contract.
ERC-721 defines the minimum interface—ownership details, security, and metadata—required for the exchange and distribution of the NFTs.
The ERC-1155 standard takes the concept further by reducing the transaction and storage costs required for NFTs and batching multiple types of non-fungible tokens into a single contract.
Bored Ape #2087 – 769 ETH ~ $2.3 Million USD. The Bored Ape Yacht Club is a collection of 10,000 unique Bored Ape NFTs— unique digital collectibles living on the Ethereum blockchain. Your Bored Ape doubles as your Yacht Club membership card, and grants access to members-only benefits, the first of which is access to THE BATHROOM, a collaborative graffiti board. Future areas and perks can be unlocked by the community through roadmap activation.
HOW IS AN NFT DIFFERENT FROM A CRYPTOCURRENCY?
NFT stands for non-fungible token. It’s generally built using the same kind of programming as cryptocurrency, like the Earth Dollar, Bitcoin, and Ethereum, but that’s where the similarity ends.
Physical money and cryptocurrencies are “fungible,” meaning they can be traded or exchanged for one another. They’re also equal in value—one dollar is always worth another dollar; one Bitcoin is always equal to another Bitcoin. Crypto’s fungibility makes it a trusted means of conducting transactions on the blockchain.
NFTs are different. Each has a digital signature that makes it impossible for NFTs to be exchanged for or equal to one another (hence, non-fungible).
They also get exclusive ownership rights. NFTs can have only one owner at a time, and their use of blockchain technology makes it easy to verify ownership and transfer tokens between owners.
Banksy art burned, destroyed and sold as token in ‘money-making stunt’. An original Banksy, which was burnt and destroyed in a livestreamed video, has been sold via a digital token representing the work for $380,000 (£274,000).
One NBA Top Shot clip, for example, is not equal to EVERYDAYS simply because they’re both NFTs. (One NBA Top Shot clip isn’t even necessarily equal to another NBA Top Shot clip, for that matter.)
HOW IS AN NFT DIFFERENT FROM A CRYPTOCURRENCY?
NFT stands for non-fungible token. It’s generally built using the same kind of programming as cryptocurrency, like the Earth Dollar, Bitcoin, and Ethereum, but that’s where the similarity ends.
Physical money and cryptocurrencies are “fungible,” meaning they can be traded or exchanged for one another. They’re also equal in value—one dollar is always worth another dollar; one Bitcoin is always equal to another Bitcoin. Crypto’s fungibility makes it a trusted means of conducting transactions on the blockchain.
NFTs are different. Each has a digital signature that makes it impossible for NFTs to be exchanged for or equal to one another (hence, non-fungible).
They also get exclusive ownership rights. NFTs can have only one owner at a time, and their use of blockchain technology makes it easy to verify ownership and transfer tokens between owners.
One NBA Top Shot clip, for example, is not equal to EVERYDAYS simply because they’re both NFTs. (One NBA Top Shot clip isn’t even necessarily equal to another NBA Top Shot clip, for that matter.)
Banksy art burned, destroyed and sold as token in ‘money-making stunt’. An original Banksy, which was burnt and destroyed in a livestreamed video, has been sold via a digital token representing the work for $380,000 (£274,000).
HOW TO BUY NFTS?
First, you’ll need to get a digital wallet that allows you to store NFTs and cryptocurrencies. You’ll likely need to purchase some cryptocurrency, like Ether, depending on what currencies your NFT provider accepts.
You can buy crypto using a credit card on platforms like Coinbase, Kraken, eToro, and even PayPal and Robinhood now. You’ll then be able to move it from the exchange to your wallet of choice.
The most popular platform to purchase NFTs is OpenSea.
You’ll want to keep fees in mind as you research options. Most exchanges charge at least a percentage of your transaction when you buy crypto.
HOW TO BUY NFTS?
First, you’ll need to get a digital wallet that allows you to store NFTs and cryptocurrencies. You’ll likely need to purchase some cryptocurrency, like Ether, depending on what currencies your NFT provider accepts.
You can buy crypto using a credit card on platforms like Coinbase, Kraken, eToro, and even PayPal and Robinhood now. You’ll then be able to move it from the exchange to your wallet of choice.
The most popular platform to purchase NFTs is OpenSea.
You’ll want to keep fees in mind as you research options. Most exchanges charge at least a percentage of your transaction when you buy crypto.
WHY ARE NON-FUNGIBLE TOKENS IMPORTANT?
Non-fungible tokens are an evolution of the relatively simple concept of cryptocurrencies. Modern finance systems consist of sophisticated trading and loan systems for different asset types, ranging from real estate to lending contracts to artwork. By enabling digital representations of physical assets, NFTs are a step forward in the reinvention of this infrastructure.
To be sure, the idea of digital representations of physical assets is not novel nor is the use of unique identification. However, when these concepts are combined with the benefits of a tamper-resistant blockchain of smart contracts, they become a potent force for change.
Perhaps, the most obvious benefit of NFTs is market efficiency. The conversion of a physical asset into a digital one streamlines processes and removes intermediaries. NFTs representing digital or physical artwork on a blockchain remove the need for agents and allow artists to connect directly with their audiences.
They can also improve business processes. For example, an NFT for a wine bottle will make it easier for different actors in a supply chain to interact with it and help track its provenance, production, and sale through the entire process. Consulting firm Ernst & Young has already developed such a solution for one of its clients.
Non-fungible tokens are also excellent for identity management. Consider the case of physical passports that need to be produced at every entry and exit point. By converting individual passports into NFTs, each with its own unique identifying characteristics, it is possible to streamline the entry and exit processes for jurisdictions.
Expanding this use case, NFTs can serve an identity management purpose within the digital realm as well.
NFTs can also democratize investing by fractionalizing physical assets like real estate. It is much easier to divide a digital real estate asset among multiple owners than a physical one. That tokenization ethic need not be constrained to real estate; it can extend to other assets, such as artwork. Thus, a painting need not always have a single owner. Its digital equivalent can have multiple owners, each responsible for a fraction of the painting. Such arrangements could increase its worth and revenues.
CryptoPunk #3100 – $7.58 million. CryptoPunks are collectibles composed of 8-bit images of humanoid characters known as Punks; each having unique traits. The CryptoPunks series is one of the earliest collectible series to ever hit the Ethereum blockchain and even inspired the development of the ERC-721 standard that is widely used by most NFTs today. Punk #3100 is an extremely rare piece since it is one of the “Alien” types, which comprise merely 9 out of 10,000 CryptoPunks. Another addition to the character’s rarity is its headband as only 405 other Punks wear this accessory.
The most exciting possibility for NFTs lies in the creation of new markets and forms of investment. Consider a piece of real estate like the Earth Dollar’s City of Atlantis Project (a real estate development near Las Vegas) can parcel out into multiple divisions, each of which contains different characteristics and property types. One of the divisions might be next to Atlantis Beach while another is in the Atlantis Resort, and yet another is a residential district in the City of Atlantis.
Depending on its characteristics, each piece of land in the City of Atlantis is unique, priced differently, and represented with an NFT. Real estate trading of the City of Atlantis, a complex and bureaucratic affair, can be simplified by incorporating relevant metadata into each unique NFT. The Atlantis Metaverse will be a digital twin of the City of Atlantis that can implement such a concept.
As NFTs become more sophisticated and integrate into the financial infrastructure, the Earth Dollar can implement the same concept of tokenized pieces of land (differing in value and location) in the physical places around the world.
WHY ARE NON-FUNGIBLE TOKENS IMPORTANT?
Non-fungible tokens are an evolution of the relatively simple concept of cryptocurrencies. Modern finance systems consist of sophisticated trading and loan systems for different asset types, ranging from real estate to lending contracts to artwork. By enabling digital representations of physical assets, NFTs are a step forward in the reinvention of this infrastructure.
To be sure, the idea of digital representations of physical assets is not novel nor is the use of unique identification. However, when these concepts are combined with the benefits of a tamper-resistant blockchain of smart contracts, they become a potent force for change.
Perhaps, the most obvious benefit of NFTs is market efficiency. The conversion of a physical asset into a digital one streamlines processes and removes intermediaries. NFTs representing digital or physical artwork on a blockchain remove the need for agents and allow artists to connect directly with their audiences.
They can also improve business processes. For example, an NFT for a wine bottle will make it easier for different actors in a supply chain to interact with it and help track its provenance, production, and sale through the entire process. Consulting firm Ernst & Young has already developed such a solution for one of its clients.
Non-fungible tokens are also excellent for identity management. Consider the case of physical passports that need to be produced at every entry and exit point. By converting individual passports into NFTs, each with its own unique identifying characteristics, it is possible to streamline the entry and exit processes for jurisdictions.
Expanding this use case, NFTs can serve an identity management purpose within the digital realm as well.
NFTs can also democratize investing by fractionalizing physical assets like real estate. It is much easier to divide a digital real estate asset among multiple owners than a physical one. That tokenization ethic need not be constrained to real estate; it can extend to other assets, such as artwork. Thus, a painting need not always have a single owner. Its digital equivalent can have multiple owners, each responsible for a fraction of the painting. Such arrangements could increase its worth and revenues.
The most exciting possibility for NFTs lies in the creation of new markets and forms of investment. Consider a piece of real estate like the Earth Dollar’s City of Atlantis Project (a real estate development near Las Vegas) can parcel out into multiple divisions, each of which contains different characteristics and property types. One of the divisions might be next to Atlantis Beach while another is in the Atlantis Resort, and yet another is a residential district in the City of Atlantis.
Depending on its characteristics, each piece of land in the City of Atlantis is unique, priced differently, and represented with an NFT. Real estate trading of the City of Atlantis, a complex and bureaucratic affair, can be simplified by incorporating relevant metadata into each unique NFT. The Atlantis Metaverse will be a digital twin of the City of Atlantis that can implement such a concept.
As NFTs become more sophisticated and integrate into the financial infrastructure, the Earth Dollar can implement the same concept of tokenized pieces of land (differing in value and location) in the physical places around the world.
CryptoPunk #3100 – $7.58 million. CryptoPunks are collectibles composed of 8-bit images of humanoid characters known as Punks; each having unique traits. The CryptoPunks series is one of the earliest collectible series to ever hit the Ethereum blockchain and even inspired the development of the ERC-721 standard that is widely used by most NFTs today. Punk #3100 is an extremely rare piece since it is one of the “Alien” types, which comprise merely 9 out of 10,000 CryptoPunks. Another addition to the character’s rarity is its headband as only 405 other Punks wear this accessory.
THE EARTH DOLLAR
The Earth Dollar is a currency based on LOVE and backed by the health and wellness of Mother Earth (Natural Capital Assets). The Earth Dollar was created for the love of the Earth and all life that dwells on her. Since love is difficult to quantify, up to $5.28+ trillion in Real Assets, including nature-based land assets called Natural Capital Assets have been pledged on-chain to back the Earth Dollar in order to restore the Earth and the climate, while simultaneously ending global poverty. The Earth Dollar provides liquidity to reinvigorate the global economy ravaged by the impact of the COVID-19 pandemic, climate change, unsustainable cities, the extinction of species, joblessness, poverty, rising cancer, and disease rates, and other crises without putting an extra debt burden on countries and taxpayers.
The initial assets pledged consist of platinum group metals (gold, silver, platinum, palladium, rhodium, carbon credits, spring water, etc.), along with residential properties, and commercial properties, Natural Capital Assets, real estate assets, manufactured assets, and creative assets via NFTs. These are only the initial Assets pledged to back the Earth Dollar; we expect even more assets in the future.
Earth Dollar will be a Carbon-Negative Asset-Backed Private Community Currency of the Earth Dollar Association and Utility Currency to pay for nodes, decentralized CPU Power, decentralized GPU Power and decentralized Storage Space on the Mother Earth Supercomputer (& Blockchain) (aka as the Mother Earth Supercomputer (aka Mother Earth OS)), one of the world’s fastest decentralized supercomputers which can process up to 1 million transactions per second to run the Living Economic System, DApps, real-time games, telecommunications, smart-contracts, IoT and more.
THE EARTH DOLLAR
The Earth Dollar is a currency based on LOVE and backed by the health and wellness of Mother Earth (Natural Capital Assets). The Earth Dollar was created for the love of the Earth and all life that dwells on her. Since love is difficult to quantify, up to $5.28+ trillion in Real Assets, including nature-based land assets called Natural Capital Assets have been pledged on-chain to back the Earth Dollar in order to restore the Earth and the climate, while simultaneously ending global poverty. The Earth Dollar provides liquidity to reinvigorate the global economy ravaged by the impact of the COVID-19 pandemic, climate change, unsustainable cities, the extinction of species, joblessness, poverty, rising cancer, and disease rates, and other crises without putting an extra debt burden on countries and taxpayers.
The initial assets pledged consist of platinum group metals (gold, silver, platinum, palladium, rhodium, carbon credits, spring water, etc.), along with residential properties, and commercial properties, Natural Capital Assets, real estate assets, manufactured assets, and creative assets via NFTs. These are only the initial Assets pledged to back the Earth Dollar; we expect even more assets in the future.
Earth Dollar will be a Carbon-Negative Asset-Backed Private Community Currency of the Earth Dollar Association and Utility Currency to pay for nodes, decentralized CPU Power, decentralized GPU Power and decentralized Storage Space on the Mother Earth Supercomputer (& Blockchain) (aka as the Mother Earth Supercomputer (aka Mother Earth OS)), one of the world’s fastest decentralized supercomputers which can process up to 1 million transactions per second to run the Living Economic System, DApps, real-time games, telecommunications, smart-contracts, IoT and more.