NFT: The History of Development and its Types

Picture : Forbes Advisor

TechSpace - Non-Fungible Token (NFT) is a token that does not have the same value and cannot be exchanged from one NFT to another because it has a different emotional or intrinsic value. NFTs can be used to represent digital assets such as images, audio, videos, and other types of digital files. NFTs can also track and describe the ownership and authenticity of physical assets, including original artwork and creative pieces such as paintings and sculptures.

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At the beginning of 2022, the viral news from an owner of the “Ghozali Everyday” account at OpenSea succeeded in introducing NFT in Indonesia. The man uploaded an NFT containing a selfie of himself in front of the camera. The man who owns the account, known as Ghozali, has made gains, especially on the NFT sales chart. Reporting from the website, NFT last jumped at the end of January 2022. However, entering February, the number of NFT purchases decreased and ended at its lowest point in mid-February. Then, how is the journey of the formation of NFT to date?

Colored coins (2012)

The history from the beginning of the formation of NFT is quite long. This started with the use of Fungible Tokens or cryptocurrencies. On December 4, 2012, Meni Rosenfeld introduced the concept of "Colored Coins," or colored coins issued on the Bitcoin blockchain.

Picture : Aprendiz Crypto

Colored Coins describe a series of methods used to represent and manage real-world assets on the Bitcoin Blockchain. In the future, Colored Coins are expected to be used as a verification tool to prove ownership of these assets. Colored Coins could be issued on the Bitcoin Blockchain for as little as 1 satoshi (0.0000000.1 BTC). Colored coins are considered very effective, but the technology didn't get any further because things improved over time.

Counterparty (2014)

Picture : Krypto Money

Counterparty is a peer-to-peer and distributed financial platform of an open-source internet protocol built on the Bitcoin Blockchain. The platform allows asset creation and has a decentralized exchange. Counterparty provides a way for users to create their tradable currency. Counterparty was famous for trading collectible rare Pepe memes.

Spells of Genesis Counterparty (2015)

Picture : Crystal Suite

In 2015, Counterparty partnered with the Spells of Genesis development team. Not only were they pioneers in issuing gaming assets to the Blockchain via Counterparty, but they were also among the first to release an ICO (Initial Coin Offering). So in development, Counterparty can introduce their in-game currency called BitCrystals. Spells of Genesis is the first game to use Blockchain to issue in-game assets.

Trading Cards on Counterparty (2016)

Picture : News Bitcoin

Then, in 2016, a new trend started to emerge. Counterparty teamed up with Force of Will, a famous trading card player. They launched the card on the Counterparty platform. Force of Will is the 4th-ranked card game in North America. Their entry into the ecosystem, where they have no previous Blockchain or Cryptocurrency experience, signifies the value of placing those assets on the Blockchain.

Cryptokitties and Cryptopunks (2017)

In 2017, there was the phenomenon of Cryptokitties and Cryptopunks. Cryptopunks are algorithmically generated icons containing 24×24 pixels unique images of each other residing on the Ethereum blockchain network. Cryptopunks was the first NFT to be launched to Ethereum. Shortly after, Cryptokitties were found and popularized the ERC721 token standard. 

Picture : Parsehub

Cryptopunks did not use the ERC271 token standard because it is hard to trade in marketplaces. Although there are 10,000 Cryptopunks that have been created, each Cryptopunks has a unique appearance and is not the same as the others. From the first time they were made, Cryptopunks were quickly claimed, so 10,000 crypto punks were declared in the community. The development of NFT has led crypto punks to become collectible commodities that are rare and sold quite expensively. 

ERC20 is the most common Ethereum token standard. These tokens have rules that allow tokens to interact with each other. Meanwhile, ERC721 aims to become the NFT standard on the Ethereum Blockchain. ERC721 helps track individual token ownership and movement.

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Cryptokitties is a raising game, caring for, and doing virtual marriages digitally. Each virtual cat in Cryptokitties has its characteristics and genes, and when mated, it will become a new unique digital asset. The game had an exponential income of 600 ETH (about USD$172,000 at the time). 

Decentraland (2017)

One industry that is considered to have the most significant potential in the Cryptocurrency world is the metaverse. The metaverse is a virtual world that allows users to perform various activities they want. One crypto project that aims to develop the metaverse is Decentraland (MANA). 

Decentraland is a virtual world or metaverse built on the Ethereum blockchain network. In it, players can buy a plot of land called LAND in the 3D virtual space. Each LAND is NFT with the ERC-72 standard. After owning a LAND, the owner can lease, sell, or fill the land with the desired objects and activities.

Picture : ArchDaily

In addition, all objects in Decentraland are NFTs that can be traded. MANA is an ERC-20 token used to purchase all things and LANDs within Decentraland. Previously, gaming was considered an activity that was just a waste of time. In metaverse games like Decentraland, players can make money while playing. Decentralandraised $26 million in an Initial Coin Offering (ICO) in under 1 minute.

NFT mainstream (2021)

From 2018 to 2021, NFT slowly moved into the public eye before finally booming in early 2021. This transition reached a turning point on Valentine's Day in 2018 when artist Kevin Abosch partnered with GIFTO for a charity auction. This partnership resulted in a $1 million transaction from CryptoArt called The Forever Rose. Abosch continued to raise the stakes when he started using the Ethereum Blockchain combination in a project called "IAMA Coin." 

Picture : Forbes Advisor

The NFT market is more efficient and liquid than existing asset transfer platforms. If you want to own your NFT assets, it is necessary to have a marketplace or need for buying and selling NFT assets. Now there are many NFT marketplaces spread all over the world. However, OpenSea is considered the largest marketplace for art, music, domain names, collectibles, and trading cards. 

From an explanation of the history of the beginning of the creation of NFT, it can be concluded that the types or forms of NFT itself can be of various kinds, and it is still possible to develop. So that makes NFT quite promising in the future. 

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