CHAPTER 13TOKENISATION AND NFTs
After discussing Bitcoin and blockchain in Chapter 12, we now turn to two more members of the Web 3.0 family: tokenisation and Non-Fungible Tokens (NFTs).
Blockchain’s transparency, security, and immutability means that we can now trade and exchange things online directly – without needing to go through a centralised authority. However, we don’t need to limit ourselves to just currency.
Think about it: is a bank note something that actually holds value, or is it a representation that you have the right to that amount of money? Humans have been using physical representations, or tokens, of their valuable assets for most of human history. Through a process called “tokenisation”, it is possible to do the same thing digitally.
Tokenisation refers to the process of converting rights to an asset into a digital token on a blockchain. This can include assets such as real estate, art, financial instruments, or individual products and services. Once something has been tokenised, it can then be transferred or exchanged securely and efficiently using the blockchain.
Non-Fungible Tokens
Just as with Bitcoin in 2017, the media started to pick up on NFTs in 2021 when several high-profile sales of NFTs – including digital art, sports collectables, and other digital media – captured public attention. But what exactly is an NFT?
If you use a token to represent currency – whether a physical coin or a Bitcoin online – each token is functionally identical. It is ...
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