<span style="font-weight: 400">Non Fungible Tokens (NFTS) are arguably the most interesting product in the blockchain space at the moment. Since the first-ever NFT, Quantum - sold last year for $1.4 million - was minted by Kevin McCoy in 2014, no one would have predicted, even with the clearest of a crystal ball, that the total value of all NFT transactions would significantly </span><a href="https://fortune.com/2022/03/10/bored-apes-cryptopunks-jolt-nft-market-to-billions-in-sales/#:~:text=The%20NFT%20marketplace%3A%20By%20the%20numbers&amp;text=According%20to%20Thursday's%20NonFungible.com,from%20%2482.5%20million%20in%202020."><span style="font-weight: 400">increase by </span><span style="font-weight: 400">21,350%</span></a><span style="font-weight: 400"> to more than $17 billion in 2021, from $82.5 million within the last one year from 2020 - 2021.</span>
<h2><b>What is NFT?</b></h2>
<span style="font-weight: 400">Non-fungible tokens or NFTs as it is mostly called are unique decentralized tokens stored on the blockchain (mostly on the Ethereum blockchain) and cannot be exchanged with something else like fungible tokens like Bitcoin. They are digital versions of physical assets that can be sold and traded on the public blockchain.</span>

<span style="font-weight: 400">There are over 5 million NFTs traded daily under different categories. Some of the categories include music, artwork, collectible items/trading cards, sport, fashion, gaming, memes, and more. Last year, </span><span style="font-weight: 400">the average price of an NFT rose from around $150 to $4,000 as interest in the digital world of art auctions exploded.</span>

<span style="font-weight: 400">To paint a more vivid picture of the burgeoning NFT market, 2.4 million NFT were sold on the OpenSea platform alone, the biggest NFT marketplace, in January.</span>

<span style="font-weight: 400">Examples of NFTs include CryptPunk, the popular digital collectibles of unique characters, NBA Top Shot, collectibles of top Basketball videos, collections of digital artworks like Beeple’s “<strong>Everyday: The First 5000 Days</strong>”, GiFs like Nyan Cat, Jack Dorsey’s first-ever tweet which was sold for $3 million, Decentraland, CryptoKitties, Cryptovoxels and millions more.    </span>
<h2><b>NFT Misconceptions</b></h2>
<span style="font-weight: 400">There’s been a lot of distrust towards NFT reminiscence of the early 90s dot.com boom. This has created growing myths and misconceptions around the NFT space. Fortunately for <a href="https://www.cryptoknowmics.com/news/nfts-minorities-modern-way-of-raising-awareness/">NFT</a> advocates, these myths have by no means derailed its adoption.  </span>

<strong>Here are 10 misconceptions about Non-Fungible Tokens that you should stop believing:</strong><b></b>
<h3><b>1. NFT is a Type of Cryptocurrency</b></h3>
<span style="font-weight: 400">Cryptocurrencies are fundamentally different from NFTs. Their singular similarity starts and ends as a blockchain creation. As earlier stated, NFTs are Non-fungible, that is they cannot be exchanged, replaced, or divided. They are unique in their identity. For example, a digital painting of the Last Supper is a unique asset that cannot be replicated or exchanged. The same goes for any other artwork, music recording, or gaming items. </span>

<span style="font-weight: 400">On the other hand, cryptos are fungible assets. That is they can be exchanged and replaced. Examples include Bitcoin and Ethereum. Their singular units can be exchanged for an equivalent amount of the dollar which currently goes for $42,000 and $3,000 respectively.     </span><b></b>
<h3><b>2. NFTs are Another Fraudulent Ponzi Schemes</b></h3>
<span style="font-weight: 400">Like cryptocurrency assets including Bitcoin and others, the idea behind NFTs is to decentralize the structure of owning digital artworks. Unfortunately, the millions of dollars some of these NFTs go for has made some unsuspecting victims fall for swindlers who push the false ‘get quick rich’ narrative with NFTs. This has given NFTs a somewhat bad reputation.</span>

<span style="font-weight: 400">But if you are familiar with how blockchain technology work, it is practically near impossible for anyone to create an artwork, mint it as an NFT, give it a high price tag and sell it for thousands or millions of dollars! Most valuable NFTs are created by established artists who are known for their physical artworks. </span><b></b>
<h3><b>3. NFTs Are Complex to Understand</b></h3>
<span style="font-weight: 400">The buzz around NFTs has created some form of complexity for potential new users to keen observers who are interested in riding on the trend. But it is easy to grasp the fundamentals of NFTs you need to stay above the noise. </span>

<span style="font-weight: 400">NFTs simply work like owning a physical asset where ownership is determined by the rules governing the blockchain. You own a physical house based on deeds of titles just the same way you own a digital asset based on unique identifiers on the blockchain that gives the asset value and security.</span><b></b>
<h3><b>4. NFTs Are Bad Investments</b></h3>
<span style="font-weight: 400">It’s easy to jump to this conclusion due to the highly speculative nature of most of the NFTs traded. Popular NFTs have seen their prices skyrocket to an all-time high that investing in them isn’t such a good idea. But there are still loads of NFTs that are still in their infancy and will give you increasing value on your investment in the long run.</span><b></b>
<h3><b>5. NFTs Production ar Harmful to the Environment</b></h3>
<span style="font-weight: 400">There’s a bit of truth in this. The blockchain NFTs are created to consume quite a lot of energy. For example, the Bitcoin network generates so much energy that amounts to the emission of </span><span style="font-weight: 400">emitted an estimated 41 metric tons of CO2. </span>

<span style="font-weight: 400">But not all NFTs are created on the part of the blockchain that consumes this huge energy. NFTs produced on the Ethereum blockchain consumes way less energy. Besides, Bitcoin emits way less CO2 than the production of heavy metals like gold. </span>
<h3><b>6. The NFT Market is Easily Accessible With a Phone or Computer</b><span style="font-weight: 400"> </span></h3>
<span style="font-weight: 400">While most NFTs are built on the Ethereum cryptocurrency, the second largest after bitcoin, some are built on newer cryptocurrencies that are not as popular. If the underlying cryptocurrency is abandoned, then there will no longer be anyone “mining” it or providing computational power to create new transactions or entries in the ledger. </span>

<span style="font-weight: 400">This would make that market entirely inaccessible, even if two willing parties wanted to make a trade.</span><b></b>
<h3><b>7. An Original NFT Cannot Be Copied</b></h3>
<span style="font-weight: 400">It is impossible to steal an original NFT, but nothing prevents anyone from copying the file to which the NFT put up for auction is linked and creating another NFT copy. These copied NFTs are traded on </span><span style="font-weight: 400">specially created marketplaces.</span><b></b>
<h3><b>8. When You Buy an NFT, You Are Buying a Digital Work of Art</b></h3>
<span style="font-weight: 400">When you buy an NFT, you are not buying a digital work of art or that $3 million Jack Dorsey tweet, you buying a token certificate, which may guarantee your exclusive ownership rights, or may not guarantee anything other than the ability to own a unique digital token.</span><b></b>
<h3><b>9. NFTs are Expensive and Unaffordable</b></h3>
<span style="font-weight: 400">There is no doubt that the prices some of these NFTs go for are astronomical; </span><span style="font-weight: 400">A Coin for the Ferryman, an artwork created by an artist known online as Xcopy was sold for a $6 million work of Ethereum in late 2021, CryptoPunk #7804, a digital art collection of unique characters went for 4200 Ethereum, about $7.6 million at that time, Human One, another artwork that was sold for close to $30 million last year and a few others.</span>

<span style="font-weight: 400">But these expensive NFTs are only a fraction of the NFT ecosystem. There are still a lot of NFTs that are very affordable to purchase by all.</span><b></b>
<h3><b>10. NFTs are All About Artworks</b></h3>
<span style="font-weight: 400">It’s easy to think that NFTs are all about digital artworks like paintings, GIFs, memes, and Tweets with mispronounced words</span> <span style="font-weight: 400">given the amount of hype and money behind digital art NFTs right now. </span>

<span style="font-weight: 400">NFTs cut across virtually other sectors including sport, music, films, gaming, and even the </span><a href="https://www.rollingstone.com/culture/culture-features/crypto-nft-sex-workers-porn-performers-1142030/"><span style="font-weight: 400">adult film industry</span></a><span style="font-weight: 400">. And these sectors are beginning to gain massive traction with tokens like Axie Infinity, WarNymph, and NBA Top Shot sold for millions. </span>
<h2><b>Conclusion</b></h2>
<span style="font-weight: 400">NFTs are the real deal in the blockchain space at the moment. If you are a newbie looking to invest in the growing and disruptive crypto space, look no further than NFTs and the misconceptions around them shouldn't stop anyone from jumping on the NFT bandwagon.</span>

10 Misconceptions Regarding NFTs

Rotimi Awe is a tech writer with particular interest in cryptocurrency and Blockchain technology. He has over 3 years of experience at writing for crypto related platforms. In addition to content writing, he is an experienced digital marketing specialist. Rotimi literally lives and breathe cryptocurrency.

10 Misconceptions Regarding NFTs

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