Non-fungible tokens do not live on the blockchain

Non Fungible Tokens(NFTs)

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Categories: Cryptocurrency

Non-fungible tokens do not live on the blockchain

Since non-fungible tokens (NFTs) are advertised as the blockchain-based technologies, there are misconceptions about how they are stored, according to two experts. He argued that technically, these tokens do not exist in the blockchain, but are actually stored elsewhere.

Jonathan Victor, Web3 Storage Lead at Protocol Labs and Alex Salnikov, co-founder of Rarible, discussed decentralized storage, the future of the NFT space and investing in NFTs. According to Victor, keychains are very limited in size and storing data on the blockchain can be very expensive. Due to the large file size of assets, off-chain storage solutions are offered.

He added that NFT data can reside anywhere from a hosted node or a decentralized storage network. Salnikov also emphasized this topic, saying that since NFTs are a new concept, there can be a lot of misconceptions about how NFT storage works. He added that transactions are confirmed by the blockchain, but the files are located elsewhere. He explained it.

Salnikov also shared that in NFT marketplace Raribal, he stored NFTs using IPFS. However, to further enhance data integrity, the co-founder of Rarible stated that they are integrated with NFT. Storage, which implements both File coin and IPFS storage. When asked about the future of the

NFT sector, experts shared their predictions. Victor believes that there will be more digital goods represented by NFTs and more use cases will emerge. He also believes that the upcoming merger on Ethereum (ETH) could help boost the price of NFTs.

Salnikov, on the other hand, shared that his vision of the space is multi-chain and that is why he is trying to democratize the storage and access of NFTs. When asked whether investing in NFTs is a good idea right now, experts gave some advice. Victor cautioned investors not to put themselves in a position where they are forced sellers.

He added that NFTs are often less liquid and advised investors to structure their portfolios in such a way that they are not forced into fire sales. Meanwhile, Salinkov shares things he keeps in mind like taking a step back and looking at the bigger picture. He explained that there will always be volatility in the prices in the market, but from a broader perspective, the NFT value is on the rise.

Blockchain, NFT, Alex Salnikov ,Digital goods, Tokens, Ethereum, File coin, IPFS, cryptocurrency

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