NFT Introduction to NFT Art 5 — Questions and Answers
Question 1: What is the primary difference between ERC-721 and ERC-1155 token standards for NFT art?
- ERC-721 supports video files while ERC-1155 supports images only
- ERC-721 creates unique single tokens while ERC-1155 allows both fungible and non-fungible tokens in one contract (Correct answer)
- ERC-1155 is exclusive to the Solana blockchain
- ERC-721 requires higher gas fees than ERC-1155 in all cases
Correct answer: ERC-721 creates unique single tokens while ERC-1155 allows both fungible and non-fungible tokens in one contract
ERC-1155 is a multi-token standard that can handle both unique NFTs and fungible tokens within a single smart contract, making it more flexible than the single-token ERC-721.
Question 2: What does 'wash trading' mean in the NFT art market?
- Cleaning up duplicate NFT listings on a platform
- Artificially inflating an NFT's price by buying and selling it between controlled wallets (Correct answer)
- Trading NFTs internationally across different blockchains
- Exchanging NFTs for physical goods
Correct answer: Artificially inflating an NFT's price by buying and selling it between controlled wallets
Wash trading involves an actor buying their own NFT using different wallets to create fake transaction history and artificially inflate perceived value and trading volume.
Question 3: Which of the following best describes 'open edition' NFT art?
- An NFT that can be edited after minting
- An unlimited number of copies of an NFT available to mint within a set timeframe (Correct answer)
- An NFT artwork open to public remixing
- A single NFT auctioned openly to the highest bidder
Correct answer: An unlimited number of copies of an NFT available to mint within a set timeframe
Open edition NFTs allow unlimited minting of the same artwork during a defined window, making them accessible to more collectors compared to limited editions.
Question 4: What is 'curated' vs. 'open' on NFT marketplaces like SuperRare and Foundation?
- Curated platforms accept any artist while open platforms are invite-only
- Curated platforms invite and vet artists while open platforms allow anyone to mint (Correct answer)
- Curated refers to physical art and open refers to digital-only art
- They are identical terms used interchangeably in the NFT market
Correct answer: Curated platforms invite and vet artists while open platforms allow anyone to mint
Curated NFT marketplaces like SuperRare review and select artists for quality control, while open platforms like OpenSea allow any creator to mint and sell without approval.
Question 5: What does 'token gating' mean for NFT art collectors?
- Limiting how many NFTs one wallet can hold
- Restricting access to exclusive content or events based on NFT ownership (Correct answer)
- A security system to prevent NFT theft
- Pausing trading of an NFT for a set period
Correct answer: Restricting access to exclusive content or events based on NFT ownership
Token gating uses NFT ownership as an access credential, granting holders exclusive access to content, communities, events, or physical experiences.
Question 6: What is 'slippage' when buying an NFT on a decentralized exchange?
- An accidental double purchase of the same NFT
- The difference between the expected and actual transaction price due to market volatility (Correct answer)
- A technical error causing an NFT to be listed at the wrong price
- The gas fee increase that occurs during network congestion
Correct answer: The difference between the expected and actual transaction price due to market volatility
Slippage occurs when the executed transaction price differs from the quoted price, often due to rapid price changes or low liquidity during the time it takes to confirm a transaction.
Question 7: What was the historical significance of 'CryptoPunks' in NFT art history?
- They were the first NFTs to sell for over $1 billion combined
- They were among the first NFTs on Ethereum and inspired the ERC-721 standard (Correct answer)
- They introduced the concept of royalties to NFT art sales
- They were the first NFTs accepted by a major art museum as donations
Correct answer: They were among the first NFTs on Ethereum and inspired the ERC-721 standard
CryptoPunks, launched by Larva Labs in 2017, were among the earliest NFT projects on Ethereum and directly inspired the creation of the ERC-721 non-fungible token standard.
NFT Introduction to NFT Art 5
What is the primary difference between ERC-721 and ERC-1155 token standards for NFT art?