NFTs

Non-Fungible Tokens (NFTs)

An NFT is a unique digital token that represents ownership of a specific asset — art, music, video, in-game items, or even real-world assets. Unlike cryptocurrencies, each NFT is distinct and cannot be exchanged one-to-one with another.

Fungible vs Non-Fungible

  Fungible (e.g., ETH):          Non-Fungible (e.g., NFT):
  ┌──────────────────────┐       ┌──────────────────────┐
  │  1 ETH = 1 ETH       │       │  NFT #1 ≠ NFT #2     │
  │  Perfectly           │       │  Unique properties    │
  │  interchangeable     │       │  Cannot be divided    │
  │  Divisible           │       │  Indivisible          │
  │  Same value          │       │  Different value      │
  └──────────────────────┘       └──────────────────────┘

ERC-721 Standard

  // SPDX-License-Identifier: MIT
  pragma solidity ^0.8.20;

  import "@openzeppelin/contracts/token/ERC721/ERC721.sol";
  import "@openzeppelin/contracts/access/Ownable.sol";

  contract MyNFT is ERC721, Ownable {
      uint256 private _tokenIdCounter;

      constructor() ERC721("MyNFT", "MNFT") {}

      function mint(address to) public onlyOwner {
          _mint(to, _tokenIdCounter);
          _tokenIdCounter++;
      }

      function totalSupply() public view returns (uint) {
          return _tokenIdCounter;
      }
  }

NFT Metadata and Storage

  NFT Structure:
  ┌──────────────────────────────────────────┐
  │  On-Chain (Ethereum)                     │
  │  ├─ Token ID: 42                         │
  │  ├─ Owner: 0x742d35Cc...                 │
  │  └─ Metadata URI: "ipfs://Qm..."         │
  │                                          │
  │  Off-Chain (IPFS / Arweave)              │
  │  ┌────────────────────────────────────┐  │
  │  │  {                                 │  │
  │  │    "name": "Cool Cat #42",         │  │
  │  │    "description": "A cool cat",    │  │
  │  │    "image": "ipfs://Qm...",        │  │
  │  │    "attributes": [                 │  │
  │  │      {"trait_type": "Color",       │  │
  │  │       "value": "Blue"},            │  │
  │  │      {"trait_type": "Eyes",        │  │
  │  │       "value": "Laser"}            │  │
  │  │    ]                               │  │
  │  │  }                                 │  │
  │  └────────────────────────────────────┘  │
  └──────────────────────────────────────────┘

NFT Use Cases

Digital Art: Artists sell directly to collectors without galleries.

Music: Musicians tokenize songs, fans own a piece.

Gaming: In-game items (swords, skins) are owned by players.

Real Estate: Property deeds tokenized as NFTs.

Identity: Soul-bound tokens for credentials and reputation.