NFT is a term is often associated with cryptocurrency. Although both operate on the blockchain, unlike crypto, NFT’s purpose is to assert ownership of a property, particularly nonfungible assets.
Nonfungible assets are items that possess and are valued for their unique attributes. Examples of nonfungible assets include artworks, diamonds, and houses. In contrast to fungible assets like gold and currency, non-fungible things cannot be exchanged for the value of another.
With the expanding ability to trade physical and digital nonfungible assets over the internet, it has gotten more challenging to track the ownership of properties. One particular issue is that it is easy to copy and distribute digital assets online. The market needed a solution to reliably determine the real owner of a property.
NFTs provide the answer to this problem. It gives items like digital art a tag and tracks its movement across networks if it is traded. Because the NFT is stored in the blockchain, the technology ensures that the details of the asset and the transaction cannot be tampered with.
However, even with the robustness of blockchain technology, some vulnerabilities still exist within the NFT market. For example, since these tokens can be kept within a cryptocurrency digital wallet, it is exposed to the same risks as cryptocurrency. Phishing and SIM swap attacks are just a few of the threats to owning NFTs.
In addition to relying on the power of blockchain technology, NFT owners can also use authentication solutions like LoginID to strengthen their NFT protection. It implements eKYC and FIDO2 protocols to secure user wallets with passwordless authentication.
In effect, it eliminates the inconvenience and susceptibility of passwords while making the authentication more reliable. In using this product, the users get a secure, private authentication for the future – LoginID.
Learn more about NFTs and how to best protect them in an infographic from LoginID.