If you have been following cryptos then you might be well aware of various allied products of it. Stable tokens and non-fungible tokens are relatively two terms that are often in the application for Bitcoins. Both these tokens hold value and adopt certain features of cryptos. 

Understanding the concept of non-fungible tokens (NFTs)

Non-fungible tokens or NFTs are always in the news. These tokens are also virtual assets and hold a similar working model to crypto tokens. But there is a fundamental difference that makes NFTs unique in the industry. 

NFTs as the name suggests are non-fungible. To make it simple, these types of tokens cannot be interchanged in the network. Each NFT is unique and holds a different value in the network. 

In case you are still confused, let us try to understand this concept through cryptos. Cryptocurrencies are fungible tokens. It means one type of crypto can be exchanged with another. That is you can buy a BTC using ETH or vice versa. However, in the case of NFTs, this is not possible. You can buy or sell only the same NFTs in the network. 

With the growth in technology and the internet, the type of NFTs has also increased. There is an online community of NFT developers and NFT holders. As we speak, you need to understand that anything that has value can be made an NFT. This could be a sculpture, picture, gaming avatar, painting, etc. 

NFTs

These assets are created in the virtual space and sold in the network. NFT owners become the sole custodian of these assets in the network. And the creator gains an advantage by receiving royalty charges. Asset creator gains royalty charges every time the asset is purchased on the internet. This works to the creator’s advantage compared to the royalty charges offline. 

NFTs may represent anything in the digital world and works on the Ethereum network. 

NFTs also make use of the blockchain working model philosophy. This is where NFTs adopt similar features to crypto tokens. Each NFT is created through the process of minting. Every NFT created in the network has a unique identifier. Even if 500 NFTs of the same product are created, each of them has a unique identifier that makes it easier to track. The user details or asset owner details are stored in the network. With each token being unique, it becomes impossible to trade one token for another. 

NFT trading exchange

With NFTs becoming popular for investments, the arena for other opportunities increased. 

Defiance ETF is the first and only NFT exchange that focused on trading NFT and another metaverse. The exchange was founded in 2018 and became listed on NYSE later. The NFTs under Defiance was launched in the year 2021. It opened to huge hype and performed comparatively well in the investment market. 

Market crash and its impact on Defiance NFTs

The market crash of crypto tokens is still a burning topic. The investment market came to a stop with lifelong savings being wiped out. Investors made heavy losses in the market space. The case of NFTs was no different. With crypto tokens crashing a similar effect hit NFTs as well. Major popular tokens were reduced in their prices. 

It would not be wrong to assume that the crypto winter continues. While the market performance seems better than in 2022, the line of recovery is not visible yet. It might take another year for cryptos to regain their position in the market. 

Defiance NFT recently announced its exit from the crypto market. As per an official statement, the company will start liquidating all its assets. This process will begin in the mid of February 2023. During this period, the online platform shall also not be accepting any new payments or investments. 

With more than 70% loss in the market, Defiance has decided to shut down its operations. In the past year alone, NFTs saw a price fall of more than 83%. The monthly sales of NFTs in January 2022 were recorded at $3 billion. this is the highest-ever sales recorded for NFTs. however, this soon became history as more than $2 billion is wiped out from the market now. 

With the crypto market not recovering, we need to wait to watch how many other operations might shut down. Visit Bitcoin smart to know the latest updates.