NFTs on Bitcoin
From zero to hero, this is exactly what can be said about non-fungible tokens. NFTs did not need a lot of time to blow up in 2021 and start trending on major social media platforms such as Twitter after the CEO of Twitter decided to mint his tweet and sold it for over $2 million and famous rappers such as Lil Baby started tweeting about them, even though it is not even past six months we can safely say 2021 has been for NFTs.
The craze about NFTs technically became possible in 2017 through an online game called CryptoKittiess that made it possible for users to be able to trade and sell virtual kittens. CryptoKitties added the Ethereum blockchain to support their advancement in technology and ensure that their virtual kittens were tradable.
What are NFTs?
NFTs, short for non-fungible tokens are unique properties that cannot be interchanged with something else. With money, it is possible to swap $100 for two $50 notes and it will hold the same value thus money is a fungible asset since it has units that can be readily interchanged. (BBC online) defined NFTs as “one-of-a-kind” assets in the digital world that can be bought and sold like any other piece of property, but they have no tangible form of their own, the digital tokens can be thought of as certificates of ownership for virtual or physical assets (Ethan, 2021).
How do NFTs work?
Currently, the Ethereum blockchain has been a major dominator facing little to no completion in terms of NFTs. The Ethereum blockchain supports NFTs, it makes it possible to mint and sell NFTs on major NFTs marketplaces such as Nifty gateway, Rarible, and OpenSea. NFTs can range from video clips, audio, images, tweets, and gifs only to mention a few. Many have been finding it difficult to make and sell their own NFTs because of the commission and charges that come with the use or transacting under the Ethereum blockchain. However, it is very good to hear that other blockchains are now able to implement their versions of NFTs for instance the Tron blockchain now makes it possible to mint NFTs (Clark, 2021).
Do they all have value (NFTs)?
Technically speaking every token or asset that is non-fungible in nature is unique on the blockchain, but it should be noted that they could exist more than one copy of the same NFT in such cases these could be trading cards where there are a lot of copies of the same artwork. The values of such NFTs are likely to be different from the value of NFTs that exist as one. Also, the value of NFTs could be depicted from how rare it takes for instance the tweet by Jack Dorsey from 2006 that went for quite a lump sum, it is very rare in the sense that there is only one Jack Dorsey in the world and there is no way he could have tweeted twice for the first time but only once, this explains the rarity behind his tweet (Clark, 2021).
Is the Bitcoin blockchain capable of supporting NFTs?
The Bitcoin blockchain is the mother of all blockchains as it is the most secure blockchain, the only problem is that when it was developed it was not meant for these types of functions with the consensus algorithm that was used Proof of work together with the programming tools that were used only prioritizing in making Bitcoin's security unmatched.
The emergence of the Stacks 2.0 protocol brings much-needed hope and faith in introducing the world’s most secure blockchain to NFTs. Stacks was developed to make it possible to program Bitcoin thus through Stacks, the Bitcoin network is now programmable and DeFi, dApps and smart contracts are now possible on the Bitcoin network.
The Stacks 2.0 protocol also does solve the scalability issue on the Bitcoin network thus the abilities of the network are further broadened, such technology has made it possible for us users especially those who cherish Bitcoin that much and willing to see NFTs on Bitcoin come to life.
Stacks unlocking the potential of NFTs on Bitcoin.
Currently, through a Stacks wallet called Boom, users can store their NFTs and the good part is the wallet makes it possible to mint NFTs. The whole process can be labeled a work in progress. A marketplace for collectibles is being developed by the Stacks team, the developers defined the marketplace as a small version of OpenSea that will enable users to trade their NFTs under the Stacks chain, such a development if fully completed, will further propel the potential that Bitcoin might have in the NFTs space, as a blockchain Bitcoin will benefit from this marketplace since it is developed by Stacks (a layer running on top of the Bitcoin network).
What does this mean for users?
So for users, this will have different meanings depending on whether you are an artist or buyer:
Artists
Openriff will give artists a way to sell their NFTs and as the developers insinuated that the platform will be much similar to OpenSea so hopefully it will have some of the features found on OpenSea such as the ability to earn a future percentage on all future transactions of the NFT (change of hands).
Buyer
Openriff will give buyers the chance to own rights of different types of arts that amuses them which mostly may come with basic usage rights. This will also give buyers a chance to support their favorite artists by acquiring their NFTs.
Use cases that can get unlocked with NFTs on Bitcoin.
(a) Artwork
Through Stacks 2.0, the limitations of Bitcoin are eliminated such that issues to do with are scalability are solved. Artists can use Bitcoin NFTs to showcase their talents to potential buyers, NFTs will contain all details the buyer needs to know about the piece of work. Payments can be made through Bitcoin and as such they will be no need for a middleman.
(b) Entertainment and Media
Bitcoin NFTs can prevent fraudulent behavior that has been in the entertainment sector for quite some time now. Bitcoin network is very much secure, this can be used as a tool to eliminate piracy and copyright infringements that lie within the industry. Through Bitcoin blockchain, replica ideas and fraud can be made impossible.
(c) Real Estate
Elimination of paperwork in the industry can be done through the adoption of Bitcoin NFTs which have high levels of security guaranteed. Land titles and property registration documents can all be tokenized under the Bitcoin blockchain and be divided into tradable tokens. This will also help in the elimination of the middleman.
(d) Source of income
Through NFTs, talented artist who were struggling to make money can now enjoy the benefits of their work. Further more, through NFTs there is digital scarcity of products hence artists are able to charge fair rates which can ensure their survival.
The hype that is coming with NFTs thus far is fully deserved given some of the use cases they unlock, and most importantly, how they ensure artists get to put food on the table from their works.
REFERENCES
BBC News. What are NFTs and why are some worth millions? BBC News. Published March 12, 2021. Accessed March 31, 2021. https://www.bbc.com/news/technology-56371912
Clark M. NFTs, explained: what they are, and why they’re suddenly worth millions. The Verge. Published March 3, 2021. Accessed March 31, 2021. https://www.theverge.com/22310188/nft-explainer-what-is-blockchain-crypto-art-faq
Coggan G. Confused about NFTs? Here’s all you need to know. Creative Bloq. Published March 24, 2021. Accessed March 31, 2021. https://www.creativebloq.com/features/what-are-nfts
Ethan. NFTs on Bitcoin Are The Next Big Thing In Crypto. Hackernoon.com. Published March 28, 2021. Accessed March 31, 2021. https://hackernoon.com/nfts-on-bitcoin-are-the-next-big-thing-in-crypto-om3q3337
stacksgov. OpenRiff — Marketplace for collectibles · Issue #5 · stacksgov/Stacks-Grants. GitHub. Published September 4, 2020. Accessed March 31, 2021. https://github.com/stacksgov/Stacks-Grants/issues/5
What is a Non-Fungible Token? — NFTs Use Cases | Cofounderstown. Cofounderstown.com. Published 2021. Accessed March 31, 2021. https://cofounderstown.com/non-fungible-token-nfts-use-cases-8dedb
