How NFTs Work？

NFTs operate and are stored on blockchain network. The blockchain is basically a large digital public record. Most popular blockchains are distributed across many nodes like people’s computers, which is why you’ll hear them described as “decentralized.”

When someone creates , transfers, buys, sells with an NFT, that all gets recorded on the blockchain. This is what enables authentication. This record serves as a permanent statement of authenticity that can be viewed or accessed by anyone. Today, when you buy a piece of art or a collector's item, it is easily forgotten, lost or destroyed, creating a very fragile system for authenticity. Blockchain’s offer a simple and more secure solution to this long standing issue of proving authenticity.

Just like other blockchain tokens, your NFT will exist on your address. It’s worth noting that NFTs can’t be replicated or transferred without the owner’s permission even by the issuer of the NFT.

NFTs can be traded in open marketplaces, including Gate NFT platforms and OpenSea on Ethereum. Their prices are volatile and are prone to price changes in response to market supply and demand as well as cultural trends that some of the NFTs are tied to. In the coming years, we will see NFTs used to unlock entirely new use cases that are only made possible by crypto.

There are many ways of creation and issuance of NFTs. The most popular one is ERC-721, which is a standard for issuance and trading of non-fungible assets on the Eethreum network.

There have been other standards introduced, such as ERC-1155. It enables a single contract to contain both fungible and non-fungible tokens, opening up a new range of possibilities. The standardization of the issuance of NFTs allows a higher degree of interoperability, which benefits the users. It means that unique digital assets can be transferred more easily between different applications.