Coming off our recent presentation at the CIC building in Providence, RI, we have compiled the question and answers from this presentation for additional consumption.
Q: What is an NFT and can you explain how NFTs benefit the artist?
A: Non-Fungible Tokens, or just NFT for short, is a unique identifying signature that connects to blockchain technology that cannot be copied, changed, or disputed. An NFT can be any form of digital art, part of a set, or a one-off piece that is tied to the work for eternity. NFT’s take many forms – images, videos, music – as well as physical ownership or interest in a physical piece creating an authentic certificate of ownership. There are many varying types of NFTs, arguably the most popular genre of NFT is the collectible avatar projects such as Cryptopunks and Bored Ape Yacht Club.
Since the beginning of 2021, we have seen NFTs from the Ethereum, Cardano, and Solana blockchains rise to immense popularity creating a whole new market for artists. NFTs allow the artist to control their own work through selling, trading, and receiving future royalties without the need for 3rd party escrow and services. In addition to this, NFTs act as a certificate of authentication allowing collectors to verify the true identity of the pieces allowing for a more transparent ecosystem.
Q: How much does it cost to create an NFT?
A: Creating an NFT can be broken down into three factors of cost. Contract setup fee, Minting Fee, and Marketplace Fee. Although creating the smart contract does not cost the artists directly, there are services that will take a small fee to help the artist to set up the parameters of the smart contract. Those artists who are technically inclined may complete this process with no cost. The minting fee or sometimes called the gas fee is the fee to write the smart contract to the blockchain. This fee goes to the miners to write and verify the data on the blockchain. This may be different amounts based on network usage and which blockchain is used. Lastly, there may be an additional fee that a marketplace may take based on where the NFT is listed. These fees range from 1%-5% based on the initial smart contract paid by the buyer.
Q: Where do the NFTs go after purchase?
A: NFTs are generally purchased from a marketplace or they are minted directly from the artist’s wallet. Once the smart contract executes, the token is sent directly to the sender’s (sender of funds) wallet. Wallets such as Metamask, are comparable with ERC-721 tokens on the Ethereum blockchain. There are numerous blockchains that can utilize smart contracts and are able to transact in NFTs. Once the NFT is in your wallet, you have full control to sell/trade your item.
Q: How can I use NFTs?
A: NFTs may take on many forms from still images to VR worlds, and even metaverse assets that can be used in games, video games, and even to create new NFTs. There are many use cases that can be implemented into each NFT. The ideas are as unique as the art itself as more and more artists adopt this new technology, we are seeing new implementation nearly on a daily basis. Typically the typical use case for NFT’s is in artwork and collectibles. Collectibles make up the vast majority of the value in the marketplace.
Q: Is this in USD or what type of currency do I use?
A: Typically the currency used is the token from the blockchain on which the token is minted on. For example, if you were to purchase an NFT on the Ethereum blockchain you would use Ether, the token used for that blockchain. However, as the owner of the NFT, you may decide to accept any form of payment, but the gas fees will need to use the original token to process gas fees.
Q: Can someone just copy, print, and steal it in the physical world; Like on a t-shirt?
A: Much like the real world, the Crypto world has the same challenges that intellectual properties have regarding theft. However, there is a unique property that an NFT has that is the “real world” assets do not have, which is a way to verify ownership. One of the key aspects of NFTs is something called the policy number and id. All NFTs get a unique policy number and id that can be verified on the blockchain. While this does not stop a thief from stealing the work, it will empower the owner to enforce their right of ownership towards litigation and retaining rights.
Q: Can I make a copy of an NFT and re-mint this as my own?
A: Unfortunately this is happening today as more and more NFTs are reaching new heights in value. As mentioned above, an informed user will be able to identify and verify the correct minter. This will ensure that the NFT being purchased is the correct one. As of right now, there is no recourse for scammers other than pulling from the markets. We are still early in this technology.
Q: Do I need a VR headset to use Virtual Galleries?
A: Our Virtual galleries from Spatial.io can be used on mobile, desktop, VR headsets, and within a browser. Due to the graphical implementation of the Virtual Galleries, there may be performance differences between lower-powered devices such as older tablets and phones. We suggest trying the gallery in VR as it provides a unique experience. Our favorite VR headset is the Oculus Quest 2 that provides a smooth, cordless, and relatively inexpensive option.
Q: How is this different than a traditional website that sells art?
A: Single Point Gallery does not sell art directly unless specified by us. What this means is that all the NFT art comes from the minter, typically the artist’s own wallet. This ensures that the piece is unique, the artist is in control of their work, and that the smart contracts are secure. Single Point Gallery will only sell “traditional” non-NFT art under the collaboration with the artist through events only.
Q: What is the accuracy of the 3D scanning? Can this be used to make prints or replicate the art?
A: Our partner, Functional 3D, can provide scanning accuracy up to .08mm which is about the thickness of a sheet of paper. This allows for a highly detailed scan that can be used to showcase and certify your work. The 3D scan is an accurate representation of the item and in some cases could be replicated. Although the 3D object can be used in 3D printers, the current technology cannot replicate an exact copy without massive input by humans. You may print the object, but color and texture may not be exactly the same. An example of this is a 3D scan of a painting. While you can print the scan down to the mm, it will be made of plastic rather than paint and canvas. Perhaps in the future, there may be a new technology that could print layers of paint much like a traditional painting.