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Ethical Hacking Blockchain Series P2 Handouts 5.7..22

The document provides an overview of non-fungible tokens (NFTs), explaining their history, how they function on blockchain technology, and their potential impact on digital ownership. It highlights the uniqueness of NFTs compared to cryptocurrencies and discusses the current popularity of NFTs among artists and collectors. Additionally, it offers cautionary advice for individuals looking to invest in NFTs to avoid scams and make informed decisions.

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57 views5 pages

Ethical Hacking Blockchain Series P2 Handouts 5.7..22

The document provides an overview of non-fungible tokens (NFTs), explaining their history, how they function on blockchain technology, and their potential impact on digital ownership. It highlights the uniqueness of NFTs compared to cryptocurrencies and discusses the current popularity of NFTs among artists and collectors. Additionally, it offers cautionary advice for individuals looking to invest in NFTs to avoid scams and make informed decisions.

Uploaded by

dianneronquillo01
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Upskill I.T.

Workshop Handbook series 05-07-22


1

Blockchain Series (NFT)

You've probably heard of Bitcoin and Ethereum, but I'm betting you
haven't heard of non-fungible tokens or NFT. In this blog, we'll go over
the basics of NFT, its history, and how you can start earning real
money with NFT and avoid being scammed.

History of NFTs

In a world where almost everything is digital, blockchain technology


has emerged as one of the most practical innovations to solve the
problem of digital ownership. The concept of non-fungible tokens
(NFTs) is based on this idea of ownership, and more specifically, how
you can prove that you are the owner of something without actually
having it in your possession. NFTs use specific information from an
artwork/piece of media to create a unique token that serves as proof
of ownership.

The first NFT sale was completed in 2013 when the artist Beeple sold
his piece “Everyday – The First 5000 Days” for $69 million. Although
NFT art has existed for years before this sale, it gained popularity after
the auction was completed in February 2021 and was considered
groundbreaking because of its high price. The sale represents a new
frontier for digital art and its potential value.

What are NFTs

What are NFTs?We can start by saying what an NFT is not: It's not a
tangible good. If you buy a painting for $100,000, it doesn't belong to
somebody else anymore. It's yours, and you can sell it again if you
want. An NFT still has monetary value, but the fundamental difference
is that this type of sale is merely a transfer of ownership rights. The
same thing happens in the case of traditional media - when you buy a
book, a song or a movie on iTunes, the content itself doesn't belong to

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Upskill I.T. Workshop Handbook series 05-07-22
2

you - only your right to access it. This kind of transaction is possible
because of DRM (digital rights management), which allows anyone to
know who owns what and in which places the content can be used.
The content itself is stored in one place - on Apple's servers, for
example. All you have is the digital key that lets you use it. So if I sell
my digital media collection after I bought it, the buyer will only have
access to the purchased album, film, or book as long as he has a
subscription to Apple Music or iTunes. The same applies to NFTs. For
example, if someone buys an NBA Top Shot moment - digital footage
of LeBron James dunking

NFTs live on a blockchain, which is a public record of transactions that


can be seen by anyone. You probably know the term "blockchain" best
as the process that makes cryptocurrencies possible. NFTs are
usually kept on the Ethereum blockchain, but they can also be kept on
other blockchains.

What is a Smart Contract

What is a smart contract? The term "smart contract" was first coined
by Nick Szabo in the 1990s. He explained it as a computer program
that executes the terms of a contract. In practice, that can mean
anything from a simple escrow agreement to complex multi-party
derivative contracts.

At its core, smart contract technology contains three things:

1. State - properties of an agreement such as balances,


ownerships, etc.
2. Transactions - inputs that cause changes in the state
3. Code - logic for what happens when transactions are received
smart contract is just software code running on the blockchain
that keeps track of an asset and conditions under which it can be
transferred. It's like a vending machine: you put money into the

Copyright ©Upskill I.T. Workshop


Upskill I.T. Workshop Handbook series 05-07-22
3

slot, push a button to select your product, and outcome your


candy bar.

How Will NFT Change the Future?

The term "NFT" refers to non-fungible tokens, which are unique and
can't be interchanged with one another. Although they're similar to
cryptocurrencies, these tokens aren't created equal. While Bitcoin can
be exchanged for other digital coins like Ether or Dogecoin, NFTs are
not transferrable but instead represent a specific digital asset. This
means that the token itself is completely unique and cannot be
interchanged for another NFT without the owner's consent—which is
why it's so valuable.

Since each token can represent anything from a piece of art to a real
estate deed, its value will vary depending on what type of asset it
represents. For example, if you own an NFT of your favorite piece of
art, it might be worth more than if you were to trade your token for an
identical one representing a different piece by the same artist. As
we've seen with cryptocurrencies like Bitcoin or Ethereum, it's possible
that an NFT could appreciate or depreciate in value over time as well.

So what does this mean for us? With this new technology, we're
entering into a whole new world of ownership where our possessions
are no longer limited by physical space constraints but rather exist
entirely within cyberspace

Why is it so Popular Right Now?

These days, everyone's buzzing about non-fungible tokens or NFTs.


Why? Well, they're on fire right now. Over the past few years, NFTs
have been making their way into the mainstream by enabling artists,
entertainers, and influencers to sell various digital items—like rare
pictures and videos—as unique tokens that can't be replicated. This is
a big shift from how people usually buy and sell digital items: you

Copyright ©Upskill I.T. Workshop


Upskill I.T. Workshop Handbook series 05-07-22
4

typically pay for access to a digital file that can be copied and used by
anyone who buys it. But with an NFT, if you purchase the only
available version of a limited-edition piece of art or a rare video clip,
you own something exclusive that no one else has access to. What's
more, is that since NFTs are stored on the blockchain—which is like a
public ledger where all transactions are recorded and validated—your
purchase can't be faked or duplicated. That means your purchase has
a value that's more than just sentimental—it's provably yours and no
one else's!

How Can You Start Earning Money With NFT And Avoid Being
Scammed

NFTs are riding a wave of popularity right now, with many people
asking how they can get in on the action. Before you start buying up
NFTs like crazy and trying to sell them at a profit, though, let me just
say this: be very careful. While some people have made significant
money off NFTs—some have even become rich—there are also many
who've lost thousands of dollars by being scammed or failing to do
their due diligence. For example, one recent NFT artist had her work
stolen from her without compensation and sold through an auction for
$6.6 million. It can happen to anyone, so here's what you need to
know before you start your own NFT hustle.

● Start small
● Investigate the NFT platform you want to sell on
● Read up on the technology and how it works
● Look out for artists claiming to be selling exclusive NFTs when
they're not
● Understand that some auctions are outright scams
● Know what your rights are as a buyer

We have just scratched the tip of the iceberg. This technology is going
to be shaping how we interact with each other and our environment.

Copyright ©Upskill I.T. Workshop


Upskill I.T. Workshop Handbook series 05-07-22
5

The blockchain industry is currently a grey area for enterprise


businesses. There are major questions regarding security and
regulation that need to be answered before any major adoption will
occur. Once these problems are solved, though, the blockchain could
potentially transform the way we interact with each other and our
environment.

Copyright ©Upskill I.T. Workshop

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