Google recently said it will allow developers to offer games on the Play Store where players can buy, sell and earn tokenized digital assets—like non fungible tokens.
About Non-Fungible Tokens (NFTs):
- NFTs are unique cryptographic tokens that exist on a blockchain and cannot be replicated.
- They can represent digital or real-world items like artwork, photograph, song, video, real estate, individuals' identities, property rights, and more.
- Thus, NFTs are assets that have been tokenized via a blockchain. They are assigned unique identification codes and metadata that distinguish them from other tokens.
- The term ‘non-fungible’ simply means that each token is different as opposed to a fungible currency such as money (a ten-rupee note can be exchanged for another and so on).
- NFTs can be traded and exchanged for money, cryptocurrencies, or other NFTs—it all depends on the value the market and owners have placed on them.
- NFT transactions are recorded on blockchains, which is a digital public ledger, with most NFTs being a part of the Ethereum blockchain.
- NFTs became popular in 2021, when they were beginning to be seen by artists as a convenient way to monetise their work.
What is Blockchain Technology?
- A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain.
- Each block in the chain contains a number of transactions, and every time a new transaction occurs on the blockchain, a record of that transaction is added to every participant’s ledger.
- Decentralized blockchains are immutable, which means that the data entered is irreversible.
- This means if one block in one chain was changed, it would be immediately apparent it had been tampered with.
Q1) What are Cryptocurrencies?
A cryptocurrency is a digital or virtual currency secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers. A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.