What are They and Is Your Money Safe? – NBC 5 Dallas-Fort Worth
You may have seen NFTs in the headlines this year – especially as some have sold for thousands, even millions of dollars.
What are NFTs? How do they work? If you buy one, is your money safe?
Read on for answers to some of your most frequently asked questions.
What are NFTs?
NFT stands for non-fungible token.
Fungible means interchangeable, like regular money. For example, four quarters hold the same value as a dollar bill.
Non-fungible means someone is unique. Non-fungible tokens are digital assets that can be just about anything including art, video or music.
If you create something you want to sell as an NFT, you “mint” it by pushing it onto the blockchain.
What’s the blockchain? In the most basic terms: it’s a shared, online ledger. It’s also the backbone of cryptocurrency.
“You can think of the chain as basically being one huge spreadsheet like a Google Doc. What’s in it or in the case of, like, Bitcoin, is the amount of money that everybody has,” said Matthew Stephenson – a behavioral economist.
Stephenson said the blockchain is a set of rules about how information is recorded and updated. Those protocols, for example, prevent someone from simply giving themselves the equivalent of a billion dollars of cryptocurrency.
“If we are going to share this big spreadsheet, then we can’t let anybody update it willy-nilly,” said Stephenson.
Those principles also apply to NFTs on the blockchain. The blockchain technology creates scarcity for things that exist in the digital space, said Stephenson.
“It enables this digital scarcity, that it’s sort of protected from tampering over time by the rules. You can get money from that, you can get collectibles from that and you can get all the other nice things we might like to be scarce and unique,” said Stephenson.
How North Texans are Buying, Selling NFTs
Stephenson said he worked with Dapper Labs, the company that partners with the NBA for Top Shot.
On NBA Top Shot, collectors can buy NBA highlight videos – known as “moments”. Collectors can buy the moments in packs or individually on the marketplace.
Each moment has a serial number. Generally, the rarer the moment, the more valuable it is.
They’re basically digital trading cards.
“It’s a moving image instead of a piece of cardboard, but it’s a collectible and there’s only one of them,” said Cash Sirois.
The North Texas sports radio personality also helped launch The Collectible Network, a streaming network devoted to covering collectibles.
Sirois believes NFTs are here to stay.
“There used to be ticket stubs to the Mavs games and now it’s all on your phone. We are progressing into a digital world in everything, so this is a natural progression in my mind,” said Sirois.
Sirois said he started adding Top Shot NFTs to his personal collection earlier this year and he’s not alone.
Dapper Labs said it began the year with 4,796 collectors on Top Shot. By April 23, it said the number ballooned up to around 460,000 collectors.
How North Texas Institutions are Adopting NFTs
The Dallas Weekly, a black-owned publication in North Texas, announced it would mint future editions as NFTs.
“We’ve had covers, we’ve had spreads and these things are basically moments,” said Patrick Washington, CEO and publisher.
“My job with the Dallas Weekly has been always about dreaming up new products and new digital ways of getting our information and our stories out to our audience and to our community. When we started all kind of chatting, we were into it,” said Dallas Weekly’s Director of Product, Jeremiah Long.
The publication plans to offer NFTs of select future editions with covers created by artists as a way to support their work and the black press.
“It was really a tangible idea to make some commission and it’s another avenue of revenue for us,” said Jessica Washington, COO and director of finance.
“It was a way for us to tap into our…
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