What does a popular explanation of fragmented NFT mean?

php Xiaobian Yuzai will explain to you in a popular way what fragmented NFT is: NFT (Non-Fungible Token) refers to non-fungible tokens, and fragmented NFT is to divide a work of art or digital asset into small pieces. Blocks are traded, and each shard has unique ownership. Through fragmentation, investors can purchase part of the artwork at a lower cost, thereby lowering the investment threshold and allowing more people to participate in the NFT market.

What does fragmented NFT mean?

When discussing non-fungible token shards, it is first important to understand the definition of this term. You can better understand the concept of fragmentation with a simple metaphor. Suppose a merchant has a gemstone in his shop that he wishes to sell to the highest bidder.

In fact, this gemstone is the only one on the market, so the price is higher. Therefore, most bidders have to wait for gemstone prices to drop before they can buy. In this case, the gem cannot find any bidders due to its higher price.

What if the merchant had a sharp cutting tool that could break the stone into even pieces? Now, merchants can sell stones to buyers at lower procurement costs, thus ensuring the flow of assets. Best of all, the lower price of the stone's uniform fragments combines to protect the complete value of the collection. The answer to "What are fragmented NFTs?" also points in the same direction.

Non-fungible tokens are gems that buyers may not be able to afford due to high prices. Put a cutting tool, i.e. a smart contract , brought into the equation, you can divide an NFT so that interested buyers can hold shares of the NFT. Smart contracts help divide NFTs based on the ERC-721 standard into ERC-20 tokens. Therefore, it is easier to divide Ownership of NFTs for easy trading and transfer.

The Importance of Fragmented NFTs

The simple definition of fragmented NFTs depicts them as tools suitable for asset redistribution. From a technical perspective , the process primarily deals with the modification of asset standards. Now, it is important to consider the need for fragmentation in the first place. Why would anyone think of breaking NFTs into fragments?

A major concern for the growth of the NFT market is lack of liquidity .Currently, the prices of some popular NFT collectibles are extremely high, making it difficult to find buyers. Due to the high prices, it is difficult for ordinary investors and enthusiasts to get involved in the NFT market. This situation may limit the further development of the market. Therefore, It is critical to find ways to increase the liquidity of the NFT market so that more people can participate. This may require developing more attractive pricing strategies or taking steps to facilitate more buy and sell transactions. Only by increasing the liquidity of the market , the NFT market can develop more healthily and sustainably.

Currently, the NFT market is facing some challenges, causing buyers and sellers to get into trouble. Sellers may not be able to transfer their assets, and buyers may not be able to purchase the assets they are interested in. . In this case, NFT fragmentation provides an effective way to solve this problem. Through smart contracts, NFT ownership can be divided, which allows retail investors to jointly own NFT artworks. This form of collective ownership is the purchase and sale of Both parties bring more flexible options while also promoting wider asset circulation and transactions.

The fragmentation of NFT also ensures that barriers to market entry are lowered while injecting additional liquidity into the NFT secondary market .In addition, artists as well as NFT creators can find flexible opportunities to mark their share of ownership of works. Therefore, they can find opportunities to obtain cash flow without selling the complete work.

The above is a small A layman's explanation of what fragmented NFTs mean. The best way to understand how NFT sharding works is to get an overview of NFT sharding projects and their capabilities. Practical examples can show you how fragmentation of NFTs can contribute to the broader The NFT market contributes real value. Users can use the NFT vault for irreplaceable token fragmentation to save their NFTs. In addition, users can also issue corresponding ERC-20 tokens for the NFTs they hold. At the same time, users The NFT's floor price can also be determined by voting. The floor price is an important aspect of NFT sharding work because it helps trigger auctions.

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