How Does The NFT Market Function?

We have been exposed to different kinds of cryptocurrencies and experienced different varieties of NFT but how does the NFT market really work?

Blockchain technology has evolved into an interesting tool since its conception. Over the last decade, it has been fascinating to witness the framework on which all cryptocurrencies, Non-fungible Tokens (NFTs), Decentralized Finance, and Decentralized Autonomous Organizations are created evolve.

Blockchains are essentially virtual ledgers that record all transactions in a public forum that cannot be altered, cheated, or hacked.

Furthermore, blockchains are decentralized, allowing the power of decision-making to be transferred from a centralized organization (such as a firm or a bank) to a group of people via a dispersed network.

This modern technology is extremely safe, has prioritized openness and accountability, and, most significantly, has returned control to its people. Blockchains prove that you are the sole owner of a particular asset.

This asset could be a cryptocurrency or an NFT. Cryptocurrencies are analogous to money. You can pay for a product or service with cryptocurrency. NFTs are digital representations of valuable products, memories, or ideas that can be purchased using bitcoin.

The collective power of blockchain is what gives it its power. It is a system that functions as a whole for all those who are invested in it, and it is a system that can be simply and concisely monitored.

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Cryptocurrency is worldwide and can be easily exchanged across national borders without the need for exchange rates or unnecessary bureaucracy.

As the world markets become more interconnected into a global community, this is revolutionary. Because cryptocurrency is constructed on the blockchain, every single touch point and transaction is tracked.

Cryptocurrency is exchanged in the same way as regular traditional money is, except instead of using a banking system, it is exchanged on a more secure platform like Metamask.

The blockchain ecosystem has enabled many businesses, including some of the world’s most well-known brands, such as Gucci, Amazon, Emirates, Microsoft, Wikipedia, and Save the Children, to receive payments, allowing them to gain a competitive advantage in the market.

Ethereum was the next evolutionary step, a blockchain with its own currency, Ether, that enabled developers to build smart contracts. These contracts are lines of code that are linked to a digital asset and are unique, traceable, and verifiable.

These contracts are incredibly secure and cannot be altered, copied, or hacked, and may be applied to anything digital. The aforementioned smart contracts are attached to all NFTs.

The global community can access NFTs through a variety of NFT market that takes very little commission or royalties from artists, allowing them to create more wealth with their work than the regular exchange, which takes a major share of the artists’ income.

Furthermore, NFT makers have the option of issuing only a limited amount of NFTs in order to create a scarcity of supply.

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Because each purchase is recorded on the blockchain, NFTs have created a channel for artists and companies to engage directly with their customers. This openness has resulted in virtual communities and devoted followers.

It has fostered true conversation between creators and customers on NFT platforms and continues to provide extraordinary opportunities for artists and creators.

Despite its infancy, Africa’s NFT business has enormous growth and opportunities. It will only be a matter of time before the relevance of NFTs on the continent is no longer debatable.

Nike and MTN, athletes like Eliud Kipchoge, and artists like Nigerian rapper BNXN are aware of this and are beginning to build within these areas.

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