What are Digital Assets and NFTs?
An Asset is anything that has a physical representation and an associated value. Traditionally, assets are things like houses and cars but can also be more common items like a water bottle. Expensive items like a house and a car have methods in which we prove ownership. This allows us to buy and sell our assets securely. Less expensive assets like a water bottle are less likely to have a secure method of proving ownership. For example, you might write your name using a permanent marker on the bottom of your water bottle so someone doesn't mistake it for their own, but we quickly see how the proof of ownership between a water bottle and a house is significantly different in terms of the security.
A Digital Asset is similar to a traditional asset as it has an associated value, but it differs in the sense that it only exists digitally. We have been creating digital assets for decades. They are commonly thought of as pictures, videos, or documents, but they can be much more than this. Proving the ownership of a digital asset is even more challenging than a physical asset since a digital asset can typically be copied and reproduced effortlessly. Like the examples from before, some of your digital assets may be extremely valuable. A secure method to prove ownership and allow you to buy, sell, and manage your assets is incredible valuable in the digital landscape of today.
A Non-Fungible Token, or NFT, represents the ownership of an asset through a digital ledger called a blockchain. Simply put, an NFT is similar to the deed to a house but does not include the house itself. The following is true about NFTs:
- Ownership is secure and publicly accessible
- Represents any unique asset which can be physical or digital
- Can be bought or sold for any value (non-fungible)
- NFT #1 does not equal NFT #2 in value
- US Dollars are fungible since all US dollars are equivalent in value
- Digital assets are not encrypted and can be reproduced
What are DAFs and why are the unique?
A Digital Asset Freedom, or DAF, stores an encrypted digital asset and the proof of ownership as one complete asset within a public blockchain. Building on the previous examples, a DAF is like the deed to the house and the house in one secure record. Additionally, DAFs have the following features:
- Hybrid ownership
- Peer to Peer trading
- Digital asset is securely encrypted
- The original asset can only be decrypted by the owner of the DAF
- Multimedia digital asset support
- Pictures, videos, documents & more
- Asset generates revenue
- Opens up the possibility of lending, buying, selling, loaning and more
A DAF can only be minted on the Wallet4Good platform. However, the wallet supports a wide variety of asset types. To get started, try the following article: