Have you been confused by recent headlines? Baffled by what an NFT is and why people are choosing to buy and sell them? That’s the same feeling many others had when reading recent headlines, either of Nyan Cat being sold as a NFT or seeing people get millions of dollars for them. So, what exactly are NFTs and why do you need to keep them secure?
An NFT is a non-fungible token. In layman terms, this means that this token is unique and cannot be replaced with another item. For example, a dollar bill is fungible - if you traded for another dollar bill, it would essentially be the same thing. By contrast, a one-of-a-kind painting is non-fungible. Even if you were to trade or sell it for another piece of artwork, you would have something different than what you began with.
That being said, NFTs can really be anything digital (drawings, music, etc), but the vast majority of individuals are currently using technology to sell digital art. People are paying huge sums of money for videos, digital artwork and more. Due to the nature of NFTs being unique, artists are selling the ownership of their work - even if the artist chooses to make copies, the buyer will still own the original piece. This is similar to a physical art collection where even if people can buy prints, there is only one owner of the original piece.
They currently operate as part of the Ethereum blockchain. Ethereum is a cryptocurrency whose blockchain also supports NFTs, which store additional information.
Artists can use NFTs as a way to sell their digital or technological artwork. This includes a unique market for things that may not otherwise be commercialized such as digital videos, for example. Buyers are also able to support artists and art that they enjoy, they are also able to uniquely gain ownership of art. These buyers are also able to collect these artworks in hopes that the value of them will go up, and then subsequently sell them for a profit.
NFTs are gaining popularity among larger brands and celebrities. Marvel and Wayne Gretzy are some big names that launched their own NFTs.
As the value of NFTs has increased, so have cybercrime and scams associated with them. Omer Segoly, CEO of Cyber Unit, stated, “We are seeing a rapid increase in cyberattacks targeting NFT wallets (e.g. MetaMask). Once a crypto asset is gone, it is forever gone!”. It is clear that if you are engaging in activities with NFTs, then it is important that you take the time to secure and store them safely. Segoly recommends Using a hardware wallet (e.g. Ledger, Trezor) to store your valuable NFTs is highly recommended.
Feel free to reach out to Cyber Unit if you have any additional questions or need support with anything from NFTs to other cybersecurity related needs. Speak to one of our professionals today.