Blockchain and NFTs 101
First things First
What is a Blockchain?
Have you used Google Docs?
Blockchain is a Decentralized Ledger
How does that relate to cryptocurrency?
Cryptography is the art of keeping things secure.
Used in Passwords, etc
1
Cryptography
It must be a type of currency that is based on cryptography
2
Cryptocurrency
Rather than the ledger being centralized, transactions are decentralized — there’s no single authority validating everything — and as secure as other encrypted data.
3
Its more than that!
So what exactly is a coin?
What is a token?
What’s the difference between coins and tokens?
Coins - All blockchain protocols have coins that represent value and can be traded.
Tokens - Tokens, are built by individual projects on top of a base blockchain protocol.
Tokens are used to actually do stuff on the blockchain through trading, including executing “smart contracts.”
Transactions
Transaction refers to an action initiated by an externally-owned account, in other words, an account managed by a human, not a contract.
Transactions
Okay, But what is a Smart Contract? 😎
Simple
A Contract which is Smart 😎
A smart contract is a contract that is written into the code of a blockchain and executed automatically when terms are met.
What are dApps?
decentralized
Applications
And what is web3?
Static Websites and Hyperlinks
Web 1
Read
Some centralized powers controlling the internet.
Web2
Write
No centralized identity controlling the internet.
Web3
Own
Consensus Mechanism
Consensus means coming to a general agreement.
Blockchain consensus typically means at least 51% of nodes are in agreement over the current global state of the network
Mining and Proof of Work ⛏
Mining is the process of creating a block of transactions to be added to a blockchain.
Proof of Stake
Isn’t an NFT just a shiny JPEG? 🎨
Non
Fungible
Token
Are NFTs just paying for a jpeg?
Can’t I just save a copy?
Not exactly!
The most important feature of NFTs is that they are unique – and the uniqueness is recognized by everyone else on the blockchain.
“More precisely,” says Hess, “that means a digital asset that you can own through your online identity within web3.”