Art NFT Fundamentals and Concepts Flashcards

What is 'wash trading' in NFT art markets?

Answer: Artificially inflating an NFT's trading volume by buying and selling between controlled wallets

Wash trading is a manipulative practice where the same entity buys and sells an NFT to themselves to fake high trading volume and inflate perceived value.

What is the ERC-721 token standard?

Answer: The Ethereum standard that defines how non-fungible tokens (NFTs) are created and managed

ERC-721 is the Ethereum token standard that establishes the rules for creating non-fungible tokens, ensuring each token has unique properties.

What is a 'custodial' NFT wallet?

Answer: A wallet where a third party (like an exchange) holds the private keys on the user's behalf

A custodial wallet means a third party controls the private keys, meaning they technically have custody of your NFTs, not you.

What does 'CC0' licensing mean for an NFT artwork?

Answer: The creator surrenders all copyright, placing the work in the public domain

CC0 (Creative Commons Zero) means the creator waives all copyright claims, allowing anyone to use, reproduce, or commercialize the artwork freely.

What is 'token gating' in the NFT art world?

Answer: Using NFT ownership to control access to exclusive content, events, or communities

Token gating uses NFT ownership as a key to unlock exclusive benefits like private communities, events, content, or services.

What is a 'rug pull' in the NFT art space?

Answer: When developers abandon a project and take investors' funds after the mint

A rug pull is a scam where creators collect mint funds and then abandon the project, disappearing with collectors' money.

What is 'secondary market' royalties in NFT art?

Answer: Automatic payments sent to the original artist whenever their NFT is resold

Secondary market royalties are smart contract-enforced payments automatically sent to the original creator each time their NFT is resold on supported marketplaces.