What is an NFT?
Non-fungible Tokens (NFTs) are one of the most widely used applications of Blockchain technology, which has grown in popularity over the years due to its association with top brands, content producers, and creative types.
What items can be sold as NFTs?
Examples of Items that can be sold as NFTs include:
A digital flow
A video clip
A viral tweet
And, if people find these valuable, you can issue them as NFTs, mint them on the blockchain, and sell them on NFT marketplaces.
So, if this is something that interests you, you can also create your own NFTs.
But, you might be wondering, why do I need an NFT if I own my content?
What Impact do NFTs have?
Technically, when your content is hosted on a centralized platform, you do not fully own it.
Middlemen take a cut of your earnings in exchange for hosting your content. Spotify, for example, pays its artists an average of $0.003 - $0.005 per stream. It's a 70/30 split, with 70% going to the artist or content rights holder.
Intermediaries, such as Spotify, have the technical ability to push your content back and change their discovery algorithms in such a way that your content is less likely to be discovered.
Many institutions own the rights to a song, such as record labels, and artists would need permission from the record label to even perform their song live.
Although they sound scary, centrally managed platforms and ownership navigate the deep waters of who owns what. Although platforms like YouTube have empowered the creator economy, it does suffer from the same issues that most centralized companies do. Furthermore, YouTube, as a centralized platform, has the ability to demonetise your content if it is flagged.
To begin earning a noticeable amount of money, creators must have at least 1,000 subscribers and 4,000 watch hours. Following that, creators can apply for YouTube's Partner Program, which allows them to begin monetizing their channels. According to Forbes, top YouTube creators can earn $5 for every 1000 views. According to Investopedia, YouTube gives 55% of its revenue while keeping the remaining 45%.
What if that cut was removed altogether? The creators will be empowered more monetarily.
If you list your NFTs on a marketplace, you will typically be charged a one-time minting fee as well as fees when your NFTs are purchased.
It goes something like this:
Your fan pays $100 for your NFT. You pay the marketplace some 10-15% while keeping the majority for yourself. However, for centralized platforms, the incentive structure is such that it consumes the creators' share, as seen with YouTube. Although YouTube is not a marketplace, the centralised platform's philosophy remains the same.
How to make NFTs?
NFT aids in the establishment of ownership of tangible digital assets, providing creators of digital artwork or any digital asset with a concrete way to earn money directly without the use of intermediaries.
So, if you are a maker or an enthusiast interested in learning how NFTs are made, here are the steps.
Also, for the sake of simplicity, let us assume you want to mint your NFTs on the Ethereum blockchain, and then we can go over the process. To interact with Ethereum, you'll need a Web3-enabled wallet like MetaMask. Metamask is available as both a mobile app and a web browser extension.
Choose a marketplace where you can sell your NFT. Some of the marketplaces that you can choose from are NFTically, mineable, Opensea, etc.
Depending on the marketplace, they will provide you with a detailed guide on how to create and mint NFTs. In most cases, you must first upload the tangible digital asset that you intend to mint as an NFT. Platforms then allow you to create a single NFT or a collection of them.
BEP-721 will be used by a single NFT, while BEP-1155 will be used by a group of NFTs. To complete the minting process, you must pay the specified gas fee from your connected crypto wallet after uploading.
NFTs are an exciting new way for creators to begin earning money and directly interacting with their audience or buyer. Direct interaction between the creator and their audience is essentially the difference between selling your digital creation as NFTs versus selling on centralized platforms.