A complete explanation and guide on NFTs
The non-fungible cryptocurrency NFT is one of the present digital currencies that has its place in the cryptocurrency market and represents another angle and capacity of the various blockchain capabilities.
Below we will go into some detail about non-exchangeable digital currencies, how they work, and their importance.
What are non-exchangeable digital currencies?
A simple definition of non-exchangeable digital currencies can be presented and deduced from its name that suggests that these currencies are not exchangeable by virtue of that each currency is different from the other, and that each currency is registered in the smart contract, and therefore cannot be exchanged directly for another digital currency, nor can it be traded either. , As no two are alike from the same coin.
Whereas, in contrast, a banknote can simply be exchanged for another, if it is of the same value, then it makes no difference to the bearer.
Even cryptocurrencies such as Bitcoin are considered a fungible currency, where some bitcoin can be sent to someone and keep some of them in the wallet with no difference in the currencies, whether sent or remaining.
Bitcoin will remain the same, the value may change depending on time, but it is basically the same.
Bitcoin is also divisible, as a small amount of bitcoin (satoshi) can be sent while non-exchangeable coins are not divisible.
The non-refundable currency can be likened to the attendance ticket for a specific event on which the name of the person is registered, so this ticket cannot be divided.
Perhaps what contributed to the popularity of non-exchangeable digital currencies is the cute game "CryptoKitties", where each cat represents a non-exchangeable digital currency.
The unique information of the non-exchangeable currency, such as “CryptoKitty” is stored in a smart contract and the information is statically recorded on the currency's blockchain.
“CryptoKitties” are Ethereum coins built to the “ERC-721” standard that use protocols based on the Ethereum blockchain.
What makes NFT coins so special?
Non-exchangeable coins have unique features and are usually associated with a specific asset.
Can be used to prove ownership of digital items within games or ownership of real physical assets.
In addition to the possibility of using non-exchangeable currencies in the field of games, they can also be used in many other areas, including distinguishing between them to prove their value or scarcity.
These coins can represent everything from virtual plots of artwork to property licenses.
Non-exchangeable currencies are not traded on cryptocurrency exchange platforms, instead they are bought or sold in digital stores such as “Openbazaar” or the “LAND” store based on “Decentraland”.
How do non-exchangeable digital currencies work?
Digital currencies such as Bitcoin and Ethereum are fungible.
Whereas the 721 ERC-based coins are not exchangeable.
For your information, these non-exchangeable digital currencies are not exclusive to Ethereum, but can be created on the Neo, Tron, EOS blockchain, as these networks support the work of non-exchangeable currencies.
Non-exchangeable currencies and their smart contracts allow the addition of detailed attributes, such as owner ID, rich metadata or secure file links.
The strength of non-exchangeable currencies is steadfast digital proof of ownership.
These non-exchangeable digital currencies are still under development, just as the blockchain based on it is.
The most prominent examples and projects of non-exchangeable digital currencies:
The Terra Virtua project:
As he told us, non-exchangeable digital currencies derive their value from their scarcity, which is why many brands start licensing their content for use in digital collections, and from the prominent companies at the forefront of providing the digital collectibles market we find “Terra Virtua”.
The "Terra Virtua" project describes itself as "the digital home", allowing fans to create a digital "fancave" where they can view their NFTs.
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