NFTs & Digital Ownership

Beyond the hype: what NFTs actually are technically, how minting works, where the art lives, royalties, and soulbound tokens.

• What Is an NFT?

  An NFT (Non-Fungible Token) is a unique blockchain record that proves ownership of a specific digital item. Unlike Bitcoin or dollars (where each unit is identical and interchangeable), each NFT has a distinct identity and cannot be swapped 1:1 with another. They are used to represent ownership of art, music, domain names, game items, event tickets, and other unique assets.

• What Is Metadata (In the NFT Context)?

  NFT metadata is the JSON file describing what the NFT represents: its name, description, image URL, and any attributes or traits. The blockchain token itself stores only a pointer (tokenURI) to this metadata file. The metadata tells wallets and marketplaces how to display the NFT, what it looks like, and what properties make it unique within a collection.

• What Is an NFT Mint?

  Minting is the process of creating a new NFT on the blockchain. When you "mint," you call a smart contract function that assigns a new token ID to your address, permanently recording you as the first owner. This is how NFTs come into existence: from nothing to a unique on-chain record in one transaction.

• What Is a Royalty (NFT Creator Royalties, Mechanics)?

  An NFT royalty is a percentage of the sale price that automatically goes to the original creator every time the NFT is resold on a secondary market. Typically set at 2.5-10%, royalties give artists ongoing income as their work trades hands. However, royalty enforcement is not universal: some marketplaces honor them, others allow buyers to skip them.

• What Is a Floor Price?

  The floor price is the lowest price at which any NFT in a collection is currently listed for sale. If the cheapest Bored Ape available is listed at 25 ETH, the floor price is 25 ETH. It serves as a baseline valuation for the collection: you can always enter at the floor, and rare/desirable pieces trade above it.

• What Is a Soulbound Token?

  A soulbound token (SBT) is a non-transferable NFT permanently bound to a specific wallet address. Once received, it cannot be sold, traded, or moved to another wallet. SBTs represent credentials, achievements, or affiliations that should not be tradeable: university degrees, employment history, community membership, proof of attendance, or reputation scores.

• What Is On-Chain vs. Off-Chain NFT Storage (And Why It Matters)?

  On-chain storage means the NFT's media and metadata are stored directly in the smart contract (permanent but expensive). Off-chain means they are stored on external systems like IPFS, Arweave, or HTTP servers (cheaper but depend on those systems staying online). Where your NFT's actual content lives determines whether it will still exist in 10, 50, or 100 years.