If you are a crypto enthusiast, it is a given that you must have come across the term “NFT” (Non-Fungible Token). If somehow missed, NFT is the phenomenon that caused the extravagant sale of $69 million in March 2021. It is a unit of data that runs on Blockchain technology and is stored on the same network.
The NFTs are used by the creators to represent real-time assets such as music, paintings, and even real estate on blockchain technology. NFT creators have strong control over the number of NFTs they issue, as well as the right to sell the NFTs in their preferred marketplace. A smart contract is used to acquire ownership of an NFT when it is purchased. The basis of Blockchain technology’s automation is a smart contract. It’s a digital code that enables asset transfers without any intermediary.
LCX has launched its own NFT called Tiamonds NFT. Tiamonds represent the ownership of real-world diamonds, and they are the largest marketplace for diamond NFTs powered by Blockchain worldwide. LCX allows you to store, buy, or sell these NFTs easily. The physical diamonds are well-stored in a secure vault in the country of Liechtenstein. All the diamonds are certified, and LCX is a regulated platform, thus making it a reliable marketplace for trading NFTs.
Some NFTs are auctioned off for millions of dollars, while others are sold for $100. This makes one wonder about the possibilities for the success of NFTs and the benefits associated with them.
The benefits of NFT are as follows:
- Increased marketplace efficiency: NFTs enable artists to communicate directly with their audiences, removing the need for third parties and intermediaries while also expanding the supply chain. Physical asset digitization simplifies transactions, improves authentication, and lowers expenses.
- Ownership: When you purchase an NFT, you acquire exclusive ownership rights to it. Because NFT operates on a public and transparent blockchain network, ownership is tied to a single account. You are purchasing intellectual property when you purchase an NFT. Because everything is embedded in the blockchain, it is easy to track down ownership. It also stops the owner from stealing other people’s IPs. NFTs are non-fungible, which means they cannot be traded for another NFT, but they may be bought and sold, making ownership transfer easier.
- Authenticity: One of the most valuable qualities of NFTs is their authenticity. The major feature of the non-fungible tokens is their uniqueness because they are created on the blockchain, thus each having a unique record. NFT creators issue a specific number of NFTs to represent the limited supply; multiple replicas are allowed only in a few cases, such as tickets. Also, blockchain-based NFTs have immutability (immunity against replacement, removal, and modifications).
- Safety: Whenever it comes to dealing with digital currency, the main concern is safety. Now, NFT runs on the blockchain, which is public, transparent, and almost impossible to alter, delete, or hack. All NFTs have distinct records of ownership and authenticity. Therefore, when the data is updated in the chain, it can not be altered or deleted.
- Insurance: One of the great advantages of NFT is that one can claim insurance according to the value of the NFT. All the products on the blockchain are embedded with smart contracts which record the owner’s information, ownership details, and the special attributes of the NFT, such as serial number, manufacturing date, etc. This smart contract can be used to prove the uniqueness and ownership of the product if it is lost or stolen, and thus the owner can claim insurance over the recorded data on the blockchain.
- Transferability: The last and most obvious benefit of NFT is transferability. NFTs can be freely traded in their particular marketplaces with a wide range of options in their trading. Smart contracts make it possible to transfer NFTs with ease. For example, the collectables inside a game can still be bought and sold if the game runs its course, but only if they are issued as NFTs. These items can thus be bought or sold outside of the games with much more profit by simply agreeing to the conditions mentioned in the smart contract.
Conclusion
NFTs have a bigger vision than just being a market asset. Its goal is to develop into a method for controlling and managing sensitive and confidential data about a corporation or an individual. Its originality and authenticity make it valuable and long-lasting, but to get the most out of it, one must invest in the correct NFTs and have the right information about it.
