LittleBits: Blockchain & NFTs for Lay People

So a lot of people asked me what I thought about NFTs and what the hell is this blockchain crap.

So let’s break it down by parts.

Blockchain

Blockchain is a way to store data.

Just like you store your data on your hard drive.

Or Facebook stores your data on one of it’s servers.

Blockchain allows some data to be stored in a network. 

A computer network.

That way instead of searching it in a centralized place you look at this network.

And each computer in this network validates if that data is what you want and if it is correct.

Applications

Bitcoin

Bitcoin is the most famous one. It is a way to use money in a decentralized manner.

It uses this architecture to send and receive monetary data. 

Instead of a central bank saying “this money isn’t duplicated and it is valid”, many computers making tons of calculations are the ones that validate the transaction.

That makes it so that no one can duplicate transactions.

Also no one can stop two wallets from exchanging money.

It’s the infamous word we are hearing now a days “decentralized”.

All that means is that the one that validades transactions are groups of computers, instead of a centralized entity.

What about NFTs?

Well, NFT is also a product that uses blockchain,

So beyond just decentralized money we now have digital artworks.

What is the NFT stand for?

It stands for non fungible token.

All it means is that a token, or any object, cannot be cloned, it is unique.

Just like your fingerprints.

A 10 dollar bill is fungible, because any 10 dollar bill can replace it.

Now applications for this NFT thing are nearly infinite.

Today we are seeing people buying signed jpegs of monkeys.

But the same technology could be used by online games to give you a registered access code. This code can then be resold to others via blockchain.

More interestingly yet is that on each transaction between this game access code, the creator can get a percentage of it. But that requires a special contract to be programmed into the access code (hint: smart contracts).

It can also mean digital tickets to events. 

All that without a centralizing platform.

Instagram blue thingy

Any Instagram account that is verified could be used as an example to explain why people buy signed monkeys.

Being verified in Instagram gives your profile more credibility to be used by advertisements.

An NFT version of that would basically mean that instead of the certified status being issued by Instagram servers, it would be issued by many people in a network. Like a voting system.

So any doubts? Suggestions?

Leave a comment bellow.