OpenSea is the largest marketplace for trading NFTs (non-fungible tokens)…its valuation is currently $13 billion. People (really enthusiasts) are flocking to sell/buy NFTs because they are decentralized, meaning they reside outside the control of banks or governmental control. However, on the flip-side, fraud and scams run rampant in the digital asset world and there is no recourse for recoupment of lost or stolen funds.
NFTs are digital assets. They are meant to be unique rather than interchangeable (fungible). Their ownership is recorded as software code on a digital ledger that is distributed on millions of computers on the worldwide internet – known as blockchains.
Creating An NFT
Making an NFT involves writing a piece of computer code that is recorded to the blockchain and is held in a digital wallet controlled by its owner. In 2021 over $30 billion were spent on NFTs, but they represent a complete 180 to the current financial system AND its rules of engagement… government-backed currency, rules, regulations, and enforcement to ensure (supposedly) a safe and secure business environment. As opposed to cryptocurrencies, NFTs, and other digital assets utilize the blockchain which offers a new way to exchange and store a virtual asset that cannot be altered or copied and is completely anonymous.
Are NFTs Safe To Trade
When someone lists an NFT for sale on, for example, OpenSea, at a certain price, that information is written into the blockchain. If that seller then decides to take that NFT off-market (making it not for sale) doing so doesn’t change the underlying code on the blockchain. This allows people to use the old price to buy the NFT that sellers thought had been taken off the market. This problem, as well as other issues, are growing pains for the digital asset world and we have yet to even scratch the surface of the profound impact blockchain technology will have on current and future industries and businesses.