What are NFTs, and How Can You Make Money From Them?

You might have heard about the clipart Rock, a crypto collectible that’s been around since 2017, which recently sold for $1.3 million. It’s a pretty old NFT! So, why did a picture of a rock sell for so much money? Keep reading.

What does NFT mean? 

NFT stands for non-fungible token. 

Fungible means you can trade one for another one. A good example of this is Bitcoin or the dollar bill: trade one Bitcoin, or one dollar bill, and you can get another Bitcoin or dollar; they can be replaced.

Unlike Bitcoin, NFTs are non-fungible, meaning they are unique and cannot be replaced with another NFT. 

NFTs allow anything digital—like digital art, a domain name, or essay—to be traded on the blockchain.

Related blog post: What is the blockchain?

What prevents someone from copying an NFT, and why can’t NFTs be duplicated?

You may be wondering: “What prevents someone from taking a screenshot of NFT art? Couldn’t everyone have the NFT?” Well, not quite. Yes, everyone could have a replica of the NFT, but it won’t be the original artwork. It would be like printing a picture of a Monet painting from the internet – it is a replica of the original painting by Monet, but it won’t be the original.

In addition, NFT artists have copyright and reproduction rights, which gives the current owner a digital certificate of ownership that can be verified by the blockchain. 

What is NFT art?

Nudie Community NFT cat Elton John
Nudie Community NFT

Often, NFT art collections will feature one type of “character,” such as the cat above, with various characteristics, also known as attributes, such as background color background, eye shape, mouth shape, hats, accessories, etc. Because these attributes can be mixed and matched, NFT collections can have 10,000 different pieces of art, or more! 

You can think of trading NFTs like trading baseball cards. You can collect them. Different cards, or NFTs, have different rarities associated with them. 

Each NFT has its own rarity score, which is based on its attributes. The higher the score, the more rare the NFT is. Let’s say 1% of the NFTs in the collection have a green background, while 50% have a blue background. The green background will have a higher rarity score, and therefore be more valuable, than the blue background. 

What is an example of an NFT?

The Nudie Community created a digital art collection of 10,000 NFTs that feature hairless cats that are exploring the galaxy and helping evolve civilizations that they would find along the way. I love that this NFT team is all-female. It’s founded by LeSandre Morris, designed by Hayley Elsaesser, and developed by Katia Gilligan.

Nudie Community NFT of cat with bling
Nudie Community NFT Art

You might be thinking, “why cats?” Well, according to the Nudie Community website, “not only does the founder have three Sphynx of her own, but cats have played a prominent role throughout history. The coexistence of cats and humans dates back to the earliest human settlements. The ancient Egyptians believed cats were magical creatures that would bring blessings for their owners. They viewed them as divine protectors and treated them with such respect that statues, jewelry, and artwork were made in their honor. Cats were so special that those who killed them, even by accident, were sentenced to death.”

Learn more about the Nudie Community here.

How can you create 10,000 NFTs?

10,000 is a big number. Let’s break it down.

NFTs are often designed in layers using graphic editor software. First, the base layer is designed. The base layer for the Nudie Community is the cat. Multiple versions of the base layer can be created by changing elements, such as the color, texture, or pattern. Afterwards, attribute layers can be created. Similarly to the base layer, the attribute layers can have different versions, as well. For example, hat and clothing type, shape and color can be modified. 

You can then mix and match different base layers with attribute layers. If you have 10 base layer versions, 10 hat variations, 10 clothing variations and 10 background variations, you could create 10,000 different NFTs. 

Typically, this is not done manually, but rather by running a script that does the mixing and matching for you. Fancy and efficient!

Where do NFTs live? And how can you make an NFT?

Here are the basics of what you’ll need to create an NFT:

  1. Something digital to sell
  2. Digital wallet, like MetaMask or Fantom
  3. Blockchain platform, like Polygon or Ethereum
  4. Connection to an NFT marketplace, such as OpenSea, Rarible and Nifty Gateway, which is where NFTs live

Read next: What is the blockchain?

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