Starting from scratch

      

     For those of you who aren't aware there is a change in the wind. When it comes to video games. This change is Non-Fungible Tokens or NFT's for short 

           For those who don't know what an NFT is here is a description of what one is.

           A non-fungible token is a unique and non-interchangeable unit of data stored on a digital ledger. NFTs can be used to represent easily-reproducible items such as photos, videos, audio, and other types of digital files as unique items, and use blockchain technology to establish a verified and public proof of ownership. 

           Now, allow me to explain how this works in games. In a video game that runs on a blockchain, you can get in-game items that can be worth money. Which you can then sell, transfer to your wallet, or hold onto until its value goes up. 

So, say you are playing a game and end up earning an NFT which is some cosmetic item in an MMO RPG. Well, you can sell said NFT on the market for in-game money, or you could sell it for actual cryptocurrency, depending on the game. The key to this is what blockchain the game runs on and what interface they use for this type of transaction. 

There are a few on the Ethereum network such as Enjin, Immutable X, and many others. These interfaces are there to help mitigate gas fees and to help the owner of the NFT to be able to transfer or sell the NFT on other platforms. 

I think I am getting a bit ahead of myself here. Maybe I should discuss what gas fees are...

Gas fees are the charges for the transaction that goes to the miners who mine the blockchain to make it all work. They get a portion of your transactions through these gas fees. Due to the fact that the transaction wouldn't work if they weren't mining the blockchain. So, to facilitate the blockchain being monitored and to keep transactions going the miners are given a portion of the Ethereum when you make a transaction.

Now you say if I have to pay a gas fee on top of a transaction fee well that is a lot of money due to the price of some of these NFT's. Well, let's have a look at the price of one specific NFT some of you may have heard of them. They are called CryptoPunks here is a listing from their website.

The lowest price punk currently for sale is 104.69 ETH, I can hear some of you now saying that that isn't much but when I tell you that one Eth or Ethereum is worth 3,632.30 as of the time of me typing this post. that 104.69 in Etherium would be 380,265.487 in US dollars. This means it is almost 400K for one CryptoPunk 

Don't believe me...

https://www.larvalabs.com/cryptopunks/details/8814

Here is a website to confirm what I just stated. 

Now, let's take a look at those gas fees. 

Gas fees are determined by several factors, including the current price of ETH, the complexity of the transaction, and the number of people transacting at the time of your transaction.  

Gas is measured in GWEI. One GWEI is one-billionth of an Ether or 0.000000001 ETH. So, if something costs 0.000000001 ETH, you can say it costs 1 GWEI. You can think of GWEI like the cents to Ether's dollars. 

The minimum amount of gas required to process a transaction is 21,000. To calculate your gas fee, you must multiply that number by the average gas cost noted in GWEI. Most wallets that support ETH and Ethereum based tokens will allow you to select the speed of your transaction and calculate the required amount of GWEI necessary to process your request.  

Gas fees are determined by multiplying the transaction cost (21,000 gas) by the price of gas, noted in GWEI.

Now the thing to remember about gas fees is that you can actually pay more to have the transaction go through faster. 

So, to say that calculating gas fees on Ethereum is complicated is selling it short. Let's take a look again at our CryptoPunk.

140.69

Let's say that our Punks gas fee is 46 cents like it is right now for the fastest transaction. 

103 GWEI x 21000 Gas = 2.163,000 =.002163 Eth which is 7.85 dollars

Now we add the .002163 Eth and the actual cost of the Punk

140.69 + .002163 = 140.692163

On top of the 380,265.487 USD, we have to add another 7.85 in gas fees. 

380,265.487 + 7.85 = 380,273.337

So, again it is expensive to pay for a crypto punk and for gas fees. 

What Enjin and Immutable X are working on is geared towards the video game aspect of the blockchain. Immutable X specifically is working on a peer-to-peer trade/ buy and sell aspect and a way to keep the gas fees low. Which is very admirable. Considering the price of getting just one transaction fee. Imagine having multiple if not twenty or more...

As a gamer myself I am very interested in where gaming NFT's will go. From having ownership over my characters to being able to possibly live off of gaming which is a dream I have had since I was at least ten years old. 

The world is changing, and I for one plan to keep a watchful eye on it.