Non Fungible Tokens (NFT for short) are a new form of cryptocurrency that uses blockchain technology. This form of cryptocurrency is used for multiple entertainments, including art made on technology, games, collectibles, music, sports, or porn. Unlike other forms of cryptocurrency like the popular Bitcoin, Non Fungible Tokens cannot be interchanged.
To understand this further, let us say you have a dollar and looking to invest in Bitcoin. You can change this dollar using Bitcoin, or it can be the same value. Non Fungible Tokens can be thought of as a certificate for a person who owns a unique object, whether digital or not. NFT affects many entertainment things, particularly with digital art, which will also be our primary focus.
Creating art on technology started to become a new way to express the artist in the 1980s. During this year, computer engineers decided to complete a new art form using the technology. The pioneer of this unique art form is Harold Cohen, a famous digital artist. Harold, along with some other workers, created a robot known as AARON.
This robot was programmed to create massive drawings using sheets of paper that were placed on the floor. After Harold Cohen, other famous artists used this new form of making art. This includes Andy Warhol and David Hockney, who used technology to create impressive art pieces.
Andy used a computer known as the Commodore Amiga when first introduced in a New York library in 1985. David was a significant fan of the IPad and used that as a way to create his artwork.
Non Fungible Tokens fit into the digital art world by keeping maintenance of the ledger and the artwork. Because of this, NFTs use blockchain technology to keep track of everything. Blockchains also prevent anyone from forging records of how Non Fungible Tokens work because they create copies of blockchain saved on different computers.
Each item that is within the blockchain is cryptographically linked when they come in. For someone to forge these digital art files, they will need to re-do the transaction on all copies, and they would need to do it all at the same time. Comparing NFTs to Bitcoin, each NFT is unique and contains information about the owner.
NFTs are also smart contracts. Smart contracts have codes rather than valuable data in a blockchain. As an example, NFTs can provide the artist with information about their sales.
While it is true that Non Fungible Tokens are more secure compared to other forms of cryptocurrency, they also face potential problems for users. For example, if built or around applications like the aforementioned smart contracts or websites, it doesn't provide the same security, unlike what NFTs do.
This could lead to hackers quickly getting into the computer/data because of the lack of security. This is evidenced by an incident that happened to the art marketplace Nifty Gateway. Many artists reported that their accounts were taken over and that their artwork was stolen, making the business lose money along the way.
The hacker attack victims stated that digital assets were sold on different social media platforms like Twitter and Discord. According to the claims, the thieves could hack their accounts and highjack their accounts, selling—buying, or re-selling NFTs.
While Non Fungible Tokens prevent forgery from happening, it does not deter accounts from theft. On the other hand, if a hacker sold the NFT, the blockchain will keep it on record.
Another dangerous factor with NFT is that some artists report that their artwork is being sold without their permission. In some cases, the artist isn't aware that their artwork was being sold until a few years.
Despite the hackers getting into artist's accounts and stealing artwork, there is a way to track these thieves. Currently, NFTs are set up depending on how many URLs are used, broken, or hacked into. Jonty Wareing, an analyst who is working on how to track hackers, did an investigation regarding the Nifty Gateway incident.
He expressed his findings on the social media platform Twitter. He found that both Non Fungible Tokens and the Json Metadata File, including the InterPlanetary File System (IPFS) gateway, are defined from the URLs made by the seller. IPFS is a system responsible for storing and accessing essential things like files, websites, applications, and data.
With these observations provided by Jonty Wareing, his conclusion stated that he wasn't impressed with what he found.
With all of the things mentioned in the article, these problems can be solved if the system was built better. Here are the three main things that can change the system for anyone who uses Non Fungible Tokens:
If these three things are taken into consideration, the system of Non Fungible Tokens will improve heavily. This also goes to real estate, where the ledger will have to give an exact amount of ownership. The ledger will check if the owner who purchased the artwork bought it directly from its creator.
A new ledger also should include a check whatever there is not an existing registration for that artwork. That way, it will decrease the chances of duplicates. As for digital files, they need to be protected more by storing the URLs in a blockchain. These are the things that need to be heavily fixed for artwork to be safe.
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