If you are just starting out in the world of cryptocurrencies, NFTs, and digital assets, there can be an entirely new vocabulary awaiting your understanding. From confusing letter jumbles to old terms used in new ways, there is certainly a learning curve in this new arena of online investing and collecting.
One term you may have encountered is the “PFP NFT.” No, that isn’t a typo. There is an entire marketplace out there for this unique six-letter combination. But, what exactly is a PFP NFT, and what are they used for in today’s world wide web?
We’ll take a deeper look at the NFT, how it functions, and how a PFP NFT operates. Understanding the basic building blocks of the entity is a great way to better grasp the big picture.
It is wise to start at the very beginning if you are learning something new. That beginning for PFP NFTs is, of course, the establishment of the NFT itself. What is an NFT? How does it work?
These are intelligent questions to research, especially if you are just starting out in the market. By breaking down its definitions, we can better understand the meaning of the NFT.
NFT, in terms of an acronym, stands for “non-fungible token.” These three words combine to make up a new product bought, sold, traded, and created completely online.
Where once there was no value, a new revenue stream (and collectible) was created seemingly out of thin air. But, once you understand the technology behind the concept, it is easy to see why it is catching on like wildfire all across the globe.
The “non-fungible” portion of the phrase breaks down to mean one that is irreplaceable. It is not able to be traded directly for another of equal value. In other words, there are no two that are the same.
If you have a quarter, for example, you can understand that that is 25 cents or the value of one-quarter of a U.S. Dollar. If you have a quarter and swap it for another, it still has the same value. All quarters in circulation are valued the same.
In this example, then, quarters would be “fungible,” or able to be traded and swapped for equally valued counterparts. In the case of the NFT, there is no equal, so they are termed “non-fungible.”
Each individual NFT is original, with its own unique owner. No copies can be made, and the true owner and validity of an NFT are easily proven through the technology behind it (which we will explain more in-depth soon).
The final part of the NFT definition is that of the “T,” which stands for “token.” A token is likely to be a term you’ve seen before. But this time, we aren’t heading into a Chuck E. Cheese arcade!
The Arcade Token
As a child, you may have been lucky enough to experience the video game arcades of the 1980s. These adventurous play spaces could keep children of all ages (and yes, adults too) busy for hours. From skee-ball to Ms. Pacman, you have a sea of choices to keep you entertained with gameplay for the entire day.
But, these games weren’t free. Typically, they averaged around a quarter each to play one turn. However, you couldn’t just roll in with your pocket change. Instead, players had to convert paper (or coin) cash into tokens.
Games didn’t take the traditional money, such as a quarter of a dollar. Instead, that quarter was represented by a golden, Chuck E. Cheese token. The token stood in for a value. However, it was unique to that arcade. A CEC token didn’t work over at Aladdin’s Castle. It only had value in that unique space.
Tokens as NFTs
In the NFT (and crypto) world, the token is very similar. However, instead of a tactile object in your hand, you are converting funds into virtual assets, or digital currency. These tokens can stand in for nearly anything.
In some cases, tokens are used to represent the real estate and land, and in others even vehicles or homes. However, most NFTs in today’s marketplace involves digital art. They are specially encrypted tokens to represent the ownership of and physical “custody” of a piece of artwork.
NFTs As Digital Art
From .jpg files to full .mp4 videos, there is a nearly endless supply of unique art in the online world. The NFT allows not only an artist to collect on their works, but also to prove undeniable ownership of a work of art. The token simply is a representation (or stand-in) for that ownership.
A Stream of Revenue
Again creating something where once was not, the creation of NFTs was originally a concept to allow artists to get credit for their work. If you are experienced at all with the online space, you know how easy it is to copy an image, steal a song, or download an illegal video.
With the Wild West, lawless origination of the world wide web, it became quite the task to apply rules. For one, the entire globe uses the Internet, and no single government controls its operations. Additionally, there are no central authorities that can regulate the use of things like copyrights when the transferring of files is so simple and, in large part, undetectable.
However, thanks to the blockchain and its technology, the new “Web 3.0” as many are calling it does interweave many of those concepts, allowing ownership to be a provable and enforceable concept. We’ll explain how that blockchain does so next, but to be able to validate your work and be rightfully paid for it was a massive step in the terms of online and digital art.
Not Just Once
Not only could artists prove work was their own with the NFT and its blockchain technology, but artists could also make money more than one time. Unlike any art before it, the NFT and digital art space took one giant leap forward discovering that they could, again because of the traceable and verifiable data, also make a commission on subsequent sales of an NFT.
In other words, let’s say Joe sells his .jpg file as an NFT online for $10. In that initial sale, he makes $10. Typically, art sales would end there. In the tangible, “real” world, the sale has taken place, the artist has made his money, and it is over.
But if Joe sold that photo to Jane, and Jane now wants to resell it, again, in the “real” world, Joe is out of the picture, so to speak, haha. Instead, it is Jane’s photo to sell. If she sells it to Bob for $15, she makes $5 (deducting her originally invested $10). Joe would typically not see any part of that $15 sale.
With an NFT, however, an artist can put a built-in commission for subsequent sales, meaning that as Jane transferred her photo ownership to Bob, Joe could have built-in, via smart contracts (another concept we will soon explain), that he gets a 10 percent commission back on subsequent sales. This would mean that, before Jane can pocket her $5 profit, she would owe Joe $1.50, or 10 percent of the sale price.
In that example, Joe not only made $10 for the original sale of the photo but also $1.50 when it sold again. Long story short, the use of NFTs not only helps artists to make a name for themselves, selling wares online but can also help them to make money long-term, more structured like a “royalty” for the playing of a song or use of a movie.
So how do these fancy NFTs work, and how did they come to be such widely used investments across the world wide web? To understand that, we must first dive a bit into the blockchain.
Massive forms of cryptocurrency, such as Bitcoin, to the smallest of penny NFTs, all operate thanks to the blockchain. But, what does it do? And how?
In its simplest terms, the blockchain is a series of gathered data (blocks), chronologically strung together (a chain). These data “containers” known as blocks contain information regarding the creation of and every transaction of a particular item.
In the case of the NFT, a blockchain will track a piece of digital art, for example, from its original creation (minting of the NFT) to each and every transfer of ownership. In terms of crypto, these blockchains are often referred to as distributed ledgers. They are tracking all the comings and goings of that particular NFT or cryptocurrency.
The distribution happens across the established peer-to-peer network. Instead of centralized powers and servers, the “power” is given back to “the people,” allowing for third parties to be eliminated. These concepts help to eliminate costs, reduce restrictions, and increase freedoms rather impossible to maintain with centralized authority.
Security and Automation
This entire technological concept not only supports the NFT and makes it possible, but it builds in automation. The use of what is called a “smart contract” can allow for the aforementioned commissions, but can also help with streamlining the entire process.
Additionally, the blockchain provides security with immutable blocks. No person or authority can change a block once it is locked into the chain. This means that there is no way that the data can be altered and will always remain true.
Uses for the NFT
Now that you have an understanding of WHAT an NFT is, it is easier to understand why they are collected. While each collector has a unique reason for their purchase, there are some very common uses of the NFT.
Why you want to collect NFTs can be a crucial first question. Some investors simply want to purchase NFTs they feel they can easily flip and make a large profit on in doing so. Others find keeping up with such volatile markets to be extremely difficult, and simply collect for fun.
In terms of art, just like it is in the tactile, “real” world, beauty is often in the eye of the beholder. For as many reasons as one may collect real-world art, so too might they collect digital art.
Many Reasons to Buy
Depending on the NFT, there are also plenty of reasons to enjoy the NFT. From visually beautiful images that you simply enjoy looking at, to full-length movies or songs for your viewing or listening entertainment, there are plenty of reasons that an owner may want to buy an NFT.
The innovation of these unique platforms also allows for budding artists to get a start, make a name for themselves, and even make money. The accessibility that these templates and easy-to-understand platform interfaces make it an approachable and realistic goal for any level of artist.
While some are into NFTs simply for the money, and others just to collect prime examples of beautiful pictures, there are also NFTs that are useful, in that they have a specific purpose. Some NFTs are created to reward game players with badges or icons to denote their progress.
Other projects exist to put the NFTs you purchase to work. From a fun background image for your Facebook page to a unique Twitter profile picture, there are plenty of practical and useful reasons to purchase an NFT, too.
NFT As a Profile Picture
So what exactly is the “PFP” before the “NFT” and what does it mean? PFP in this case stands for the profile picture. You know the one. You create a social media account. It asks you for a photo to show that it is you.
In some cases, users choose a headshot of themselves. Others use a cartoon-like avatar to represent themselves. Fare more change profile pics to be pets, objects, vacation images, or even symbols. With endless choices, there is no wonder that the NFT made an ideal article for the profile picture industry.
Unique Profile Picture
Online personalities love the idea of personalization. Your online image can mean a lot, and to some, it is nearly everything. When you are doing a search for your profile picture, you want to find something unique. You want to find something that, while sharing your opinions online, you can proudly stand behind.
Some users are comfortable with their own smiles and select a simple headshot. But, as the technology improves to allow for it, the concept of the PFP NFT has taken flight. The strategy to save such an image, own its rights, and use it in marketing yourself, however, needed the tech of the blockchain and NFT to support its use.
Custom Profile Picture Choices
Choosing a profile picture has different gravity for different folks. In other words, how much the frames around your photo, the filters you use to enhance your image, or the uniqueness of your custom NFT profile pics can vary in importance, depending on your age, the platforms you use, and your interest in such matters.
For some, a photo is a photo. A picture is as simple as it sounds, and they quickly and without much thought, pick a profile pic in a matter of moments. Some use the same headshot from site to site.
For others, however, the profile photo is a personal brand. It is a chance to make a statement. It is not a simple photo upload, but an opportunity to personalize your space.
Variations by Site
Depending on the social media profile pictures, plenty of judgments are instantly made. Instagram is known for its images and visually appealing posts. Twitter tends to trend toward the informative, with short, punchy Tweets. Facebook has been dubbed the brand of an older generation, with youngsters gravitating toward video uses like Tik Tok.
No matter the social media sites you use, the profile picture becomes an important choice. On professional sites such as LinkedIn, users often want to choose a pic that will provide proof of their professional side. This isn’t a space for bizarre logos or unique art projects. Instead, the tools you use on LinkedIn will vary greatly from say your personal Facebook page.
More Technology, More Choices
As the tech improves across the globe, so too does the quality and uniqueness of the profile pic. Whether you are surfing YouTube or posting your latest vacation pics to Instagram, you often want an example that means something to you, that is your “brand” or represents yourself well.
As new apps are created to remove background disturbances (even from new phones), frame your images with fun boarders, allow for the use of templates, and, well, a plethora of new advancements in pictures every day, so too did the variety of choices for a pic. Many apps are even free to use, allowing nearly anyone on the device accessibility to select profile pictures that represent them best.
Profile Picture Template
With a quick search, you can find thousands of templates ready and available online. If you aim to make your profile pic more unique, you can use these profile photo customizations to add some flair.
Free tools like Canva.com or Adobe allow users to, with a simple photo upload, alter image profile pics with ease. You can make a fun image quickly and make your picture stand out.
Should you discover a way that you enjoy (or hit on the hot, new trend), you can also mint your template into an NFT. That way, not only are you able to profit off of your background concept or use of different pictures, but you can also share them with the NFT marketplace.
Benefits Beyond a Profile Photo
The NFT has a world of benefits, far beyond the use of a profile picture, but with the rampant use of online platforms that require some sort of image, it isn’t likely customization that will go away soon.
From a fun way to release a new single song track to a quality sign that you’ve “made it” with your first launched collection, there are dozens of reasons to dive into the world of NFTs. The specialized toolbox that the blockchain and its products allow for means that uploading a simple headshot may soon be a thing of the past.
Popular PFP NFTs
As the confidence grew, right alongside improving technologies, users were excited to post profile pictures with far more than a simple smile. The “art” of the profile photo became almost a requirement overnight.
No longer is a simple “remove background” wowing the true photo audience. The profile pictures game has really stepped up over the years. With some spending millions on such art, the concept of profile pictures has come a long way over the years.
Here are some of the most popular PFP NFTs that have helped it do so. If you want to “up” your profile pics game, these are certainly some names to research.
One of the early offerings in the PFP NFT space was CryptoPunks. CryptoPunks by Larva Labs brought to the world a collection of 24×24 pixel profile pics, that, at first look, may not wow you. But as celebrities invested millions and influencers began to upload them by the dozens, it soon caught on as a popular image option in the NFT space.
These small, headshots offered digitized images of “punks,” which include everything from a backward hat-wearing teen to a lizard-like alien. With the alteration of a handful of accessories, such as glasses, a cigarette, hats, and hairstyles, the collection launched first in 2017 with its set limit of 10,000 images.
Bored Ape Yacht Club
Another early developer of the ever-popular PFP NFT was the Bored Ape Yacht Club (BAYC). BAYC operated on a similar concept as CryptoPunks, taking a “headshot” like image, digitizing and pixelated into a hot commodity.
Instead of “punks,” however, BAYC focused its art on the ape. Also launching with 10,000 unique NFTs, these famed photos have been purchased by the likes of Jimmy Fallon, Eminem, and Madonna. Across dozens of industries, these cartoon-like monkeys have taken the world by storm.
The ‘Spin-Off’ Market
Since the popularity of the aforementioned caught on so feverishly in recent years, there have been many other popular names in the photos business. No matter the platform, it is likely you can find a unique offering in the PFP NFTs marketplace.
Some of the up-and-coming big names in the game to watch out for in 2022 especially include:
With new NFTs being minted each day, the opportunity to own your first PFP NFT is an opportunity you can likely enjoy soon!
The Future of PFP NFTs
No one can say for sure what the future holds for any of us, but the likelihood of the PFP NFT marketplace booming for a few years more is a good one. With social media sites like Twitter expanding technology to create verification methods into their system, it is likely more platforms will catch on, too.
With more checks and balances, more users will feel comfortable investing in a PFP NFT for their own use. From YouTube to Tik Tok, you are likely to see the art of the profile pic continue to evolve.
Tools for use in NFT projects continue to grow and change. There is always something new coming just around the corner.
It can be hard in such an evolving space to adjust to the changes quickly. In order to know the best marketing tips, the hot new upcoming tool, or the next projects to make NFT drops, you have to stay in the know.
Additionally, after getting to know these concepts on your own, you can begin to create projects, too. But, one thing is for sure. Whatever the future holds, staying informed will be key to success in the market. If you want a shot at the next best thing, you need to know what that thing is and how it works!
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