Previous projects like Colored Coins and Mastercoin, which also centred around adding additional data to the bitcoin chain, withered away as BTC became congested, and it was uneconomical to post information that provided no additional value and kept bitcoin as a place to store essential financial transactions data.

While most people associate the idea of NFTs with smart contract chains, you might be surprised to know that NFTs have been part of the bitcoin ecosystem for nearly a decade however, they never really took hold, and most bitcoin holders don’t see the point of these systemically flawed form of “digital assets.” Today NFTs are a big part of the use case for altcoin and altcoin chains, allowing for markets where people can create custom tokens referencing a piece of media and try to encourage speculation around it. This token or hash on the chain is then linked to an external file, content like digital art, movies, and music and used as a way to claim proof of ownership or membership in an exclusive group.

NFTs are marketed as “digital assets” that are provably unique merely because it is tied to a hash on a blockchain. Even though the NFT market has lost over 96% of its trading volume and the speculation around it has dried up, there remains a diehard cohort of collectors. If you’re new to the space or have better things to do with your time, then your first experience with NFTs has had to be the speculative mania of 2017 with games like crypto kitties or in 2021 with art NFTs going mainstream.

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