NFT or Non-Fungible Tokens are tokens that are used to represent ownership of unique items. They let us tokenise things like art, collectibles, and even real estate.
A non-fungible token (NFT) is unique and can represent any digital asset on a blockchain (such as Ethereum, Solana, Flow, Tezos, etc.), thus making it scarce, provable, and valuable. The advent of NFTs have created a new medium for artists and creators to showcase their creations or collections.
Though NFTs have been around since 2014, 2021 was the first year that this novel technology broke through into the mainstream, disrupting the art world and industries beyond it. Over the course of the past 12 months, the NFT scene has evolved rapidly.
Who created the first NFT?
Now where did this technological phenomenon come from? The history of NFTs and the man who first created one, Kevin McCoy, began on May 3rd, 2014. He minted his non-fungible token “Quantum,” way before the crypto art market exploded.
NFT Beginnings on Bitcoin
If NFTs were a superhero movie, then Colored Coins would be the origin movie. Initially issued on the Bitcoin blockchain for as little as a single satoshi, the smallest unit of currency, Colored Coins had a lot in common with current NFTs.
While most people associate NFTs with Ethereum these days, the reality is this phenomenon started on the Bitcoin blockchain. In the early days of Bitcoin, a concept known as “colored coins” gained some fame as a way of issuing other types of assets on top of the blockchain. The idea was these colored coins, which were basically just satoshis used to represent something else, could be used to allow Bitcoin users to issue everything from stock in a company to in-game items for video games.
A BRIEF HISTORY OF NFTS EXPLAINED
2012: Colored Coins
The futuristic Non-Fungible Tokens have had a long history. The game-changing journey of NFTs started in 2012 with the emergence of Colored Coins. Built on the Bitcoin network, the Colored coins are originally conceptualized for issuing real-world assets like real estate on a blockchain as proof of ownership. It was the first existence of NFT that was used to represent many assets, including property, coupons, company shares, subscriptions, access tokens, digital collectibles, and more. The inception of Colored Coins widened the growth horizons for NFTs and unlocked greater possibilities for experimentation.
As a result, Counterparty was created in 2014. Founded by Robert Dermody, Adam Krellenstein, and Evan Wagner, Counterparty was a peer-to-peer financial platform/open-source online protocol that was developed using the Bitcoin blockchain. It was conceived from the idea of asset creation and a decentralized exchange without any possibility of counterfeiting. A trading card game and meme trading were the most common application areas of Counterparty. The excitement around Counterparty notably led to the development of many popular NFT collectibles games, including Spells of Genesis (in 2015), Force of Will – Trading Cards (in 2016) and Rare Pepes (in 2016) into the ecosystem.
As Rare Pepes trading picked up, John Watkinson and Matt Hall, the creators of Larva Labs, created unique characters generated on the Ethereum blockchain. No two characters would be the same and they would be limited to 10,000. The project name, Cryptopunks, was referenced to an experiment with Bitcoin in the 1990s and can be described as an ERC721 and ERC20 hybrid.
CryptoKitties is a blockchain-based virtual game that allows players to adopt, breed and trade virtual cats from the safety of your own wallet. It was released by a Vancouver-based company called Axiom Zen and was introduced during the world’s largest hackathon for the Ethereum ecosystem. With over 400 developers attending, it was the perfect place to introduce the game. This project went viral soon after. It was so popular that people were making crazy profits trading those cats. Also, the activity was so high that CryptoKitties clogged the Ethereum blockchain in general, which made it even more prominent. After witnessing this activity, people began to realize the true power and potential of NFTs.
2018-2020: NFT gaming
Between this period and moving forward, NFTs slowly but surely caught public attention, most certainly through NFT gaming and metaverse projects. The first to enter this space with its decentralized Ethereum-based VR platform was Decentraland (MANA). In Decentraland, gamers can explore, build, play games, and collect items and more. Imagine Minecraft, but whatever you build, find and earn there, you own as well.
NFT: The Future
While the history of NFTs is intriguing, the future of NFTs has endless opportunities as the new space transitions from raw and experimental to exceedingly more useful and mainstream. Through tokenization, programmability, collaboration, royalties, and more direct connections between artists and collectors, NFTs may soon be a technology vital to everyday life.
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