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Origins of NFTs

Georgios by Georgios · July 31, 2022

NFTs have transformed the art industry entirely, and because of them, many artists can now make a living from their art. The initials stand for non-fungible tokens or in other words unique tokens that exist on the blockchain and cannot be replicated, similar to cyptocurrencies but instead of using crypto exchanges, they are traded on marketplaces like OpenSea. Thanks to this characteristic, they can indicate ownership of digital assets, which might be anything from digital images to virtual spaces within a metaverse.

They gained a lot of popularity in 2021 with Beeple's record-breaking $69 million NFT sale but have been around for longer than most people know. Let's take a look at their fascinating history.

Coloured Tokens

In 2012, Meni Rosenfield published a paper introducing the concept of "Coloured Tokens" to the Bitcoin blockchain. The idea was to use these to represent and manage real-world assets and prove ownership of those assets on the blockchain without the need for a third party independant evaluator.  

These colored tokens would have an additional token element. These elements would help determine their use and make each one of them unique. However, this concept could never be implemented because of the limitations of the Bitcoin blockchain. Thanks to this idea though other enterpreneurs conducted numerous experiments which would eventually lead to the creation of NFTs as we know them today.

Quantum

Quantum, the first modern NFT, was minted by Kevin McCoy and Anil Dash on the Namecoin blockchain on May 3rd, 2014. It was a video that McCoy's wife had made, and he sold it to Dash for $4. This was done as part of a live presentation for the Seven on Seven Conference in New York City, and they originally called them "monetized graphics." In the years that followed, a lot of developments and improvements were made to NFTs, and although platforms were built on the Bitcoin blockchain to support NFTs, it was Ethereum that took over the NFT markets, and it has reigned almost unopposed since.

The Rise of Ethereum NFTs

Terra Nullius was the first NFT to be minted on the Ethereum blockchain. It was minted on the 7th of August in 2015, and the goal was to let its owner stake their claim on the blockchain by allowing them to write a short message in their NFT. That same year, Etheria was launched, and it was the first NFT project. This launch was made at DEVCON 1, Ethereum's first developer conference that was held in London three years after the launch of Ethereum. It had 457 tradeable hexagonal tiles in the collection, but most of these were unsold until March of 2021.

The name NFT gained its popularity with the release of the ERC-721 standard tokens in 2017. ERC-721 are tokens on the Ethereum blockchain that are non-fungible and are all individual. After this, a lot of NFT projects were launched that year. The colossal success CryptoKitties enjoyed also helped to bring the attention of more people to NFTs.

Conclusion

NFTs have revolutionized the art and gaming industries, and now they're making their way into other industries and bringing all their advantages. Next time you're about to create or invest in a new NFT, remember that they have been around for a long time and it's not just a hype of the last couple of years. They deserve your respect but remember there is also a lot of opportunites.

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