NFTs utilize blockchain technology. Through the blockchain, NFTs can be created, bought, and traded. To give some context, the blockchain is a type of database that stores information electronically. What makes the blockchain different from traditional databases is how the data is structured: “A blockchain collects information together in groups, also known as blocks, that hold sets of information.” Each block has a set amount of storage capacity and, once the block is filled, it is “chained” to the previously filled block. A majority of NFTs exist on the Ethereum blockchain where there are “permanent digital records of all transactions using that cryptocurrency.”
For NFTs, each block has a hash that makes each NFT unique. One way to describe a hash is comparing it to a fingerprint. The “token owner owns a record and hash code that shows ownership of the unique token associated with the particular digital asset.” Having a unique hash is important for maintaining security throughout the different blocks as there are concerns of hackers tampering with the blocks and changing the hashes.
The hash is very useful when you want to detect changes to intersections. If the fingerprint of a block changes, it does not remain the same block. Each Block has: Data, Hash, Hash of the previous block Consider following example, where we have a chain of 3 blocks. The 1st block has no predecessor. Hence, it does not contain has the previous block. Block 2 contains a hash of block 1. While block 3 contains Hash of block 2.
NFT Domains are new web extensions (like .com or .info) launched as smart contracts on public blockchains. For example, domains are an ERC 721 on the Ethereum blockchain and Polygon Network, except .zil which uses Zilliqa.
NFT Domains are stored in a wallet by the owner, much like a cryptocurrency, and no third party can take them away. Pay once, and you own the domain for life, with no renewal fees.
Self-custody is one of the most important features of an NFT Domain. This is what makes your domain decentralized – This is what gives you complete control over your domain!
A self-custody solution is possible because your domain is an asset on the blockchain and stored like a cryptocurrency in your wallet. This custody method gives your NFT Domain “superpowers” that traditional domains do not have.
Due to the self-custody nature of your blockchain domain:
- Can not be seized by a third party.
- Can enable decentralized websites.
- It can be transferred around the world in seconds without needing permission from any third party.
- It gives the owner sole control and access to domain management features – adding crypto addresses and pointing content to your domain.
Replacing cryptocurrency addresses with a human-readable name
You control the domain, so you are the only person able to associate cryptocurrencies with it. Input your cryptocurrency addresses on the blockchain itself. When someone types your domain name (for example; yourname.crypto) into an integrated wallet, the wallet looks up that domain on the blockchain finds the appropriate address, and sends. It’s that simple.
More commonly, blockchain domain addresses are used for payments. These .crypto domains work inside of 50 different crypto wallets and exchanges. You can just send money to Brad.crypto, for example, because that’s essentially his username for the crypto web.
Unstoppable Domains builds domain names on blockchains, meaning that each domain name is a non-fungible token (NFT) stored inside the user’s cryptocurrency wallet instead of within a traditional, centralized registrar like GoDaddy.