Introduction
As technology develops rapidly, digitalization has experienced its golden age in recent years. Concepts that we had never heard before entered our lives. Over the next ten-year period, we will witness mesmerizing innovation in the digital age that should change technology and society. NFTs are one such example. Although they've been around since 2014, NFTs are gaining notoriety because they are becoming an increasingly popular way to buy and sell digital artwork.
NFT stands for non-fungible token. It's generally built using the same kind of programming as cryptocurrency, like Bitcoin or Ethereum, but that's where the similarity ends. They are used mainly to "tokenize" many assets such as videos, artwork, objects in games, gifs, and collections on the blockchain network. The NFT market has started to develop more rapidly than ever because of the popularity of the Metaverse universe. Metaverse is defined as "a shared virtual universe that can be experienced simultaneously and integrated with the physical world using augmented reality, virtual reality, and blockchain." The technological opportunity and infrastructure to implement the Metaverse do not yet exist. However, some of the technologies required to create Metaverse are already in use, and one of these technologies is undoubtedly NFTs.
What is NFT?
NFT stands for a non-fungible token, which means in every piece of artwork, there's a unique and non-interchangeable unit of data stored on a digital ledger using blockchain technology to establish proof of ownership. The same technology used for cryptocurrencies like bitcoin and ether guarantees the uniqueness of each NFT and proves who owns it. On the other hand, Fungible items can be exchanged because their value defines them rather than their unique properties. For example, ETH or dollars are fungible because 1 ETH / USD 1 is exchangeable for another 1 ETH / USD 1. NFTs have a sole owner and cannot be copied. In addition, they are not centralized, meaning that no one can take them away from you.
What are NFT Domains?
NFT domains are smart contracts and software written on a public blockchain. Instead of one company controlling your data online, the power is transferred back to you as the user. And by being built on blockchains, anyone can look at the data stored there, creating a level of ultimate openness and transparency. NFT domains are new web extensions such as ".crypto" or ".eth" (similar to .com or .info) that are linked to the blockchain via smart contracts. Their difference from traditional domains is that due to the nature of NFTs, the domain is "certified" with personalized smart contracts when bought as NFTs.
The blockchain contains information about the owner of the domain and the content of a website or part. The NFT domain is stored in a wallet, just like cryptocurrencies or NFTs. This means you're independent of the actual Internet and any third-party providers. NFT domains are also used to facilitate cryptocurrency trading.
A few examples of available domain extensions are:
.crypto
.wallet
.bitcoin
.nft
.blockchain
.defi
IMPORTANT: NFT domains are not released by ICANN means that they are not registered in the root directory of the Domain Name System (DNS). Therefore, they cannot be accessed across all browsers or only with the help of a plugin.
How to register an NFT domain name
You may be familiar with the traditional process of buying a domain on a domain registrar like GoDaddy or BigRock. NFT domain names are often traded on NFT marketplaces like OpenSea or Unstoppable Domains and are typically purchased using cryptocurrencies. Some providers allow you to buy the domain directly and pay in currencies like US dollars. NFT domains cannot yet be registered with classic domain providers that act as registrars.
Summary
NFT domains can potentially be a big deal. They offer a taste of what could happen when it comes to the possibilities of Web 3.0. For someone casually surfing the Internet, the NFT domain may not seem such a big deal. Still, a decentralized domain can function as a wallet address with its own functional, decentralized financial infrastructure. NFT domains can eliminate the need for an Internet-infrastructure monopoly and payment processors like PayPal and Stripe that traditionally charge sites and their visitors for a percentage.
Disclaimer: NFTs are an emerging asset class that is still evolving. The information in this article should not be construed as investment or financial advice. Always do your research before deciding to buy, sell or trade NFTs.