The Basics

What is all this jargon about...

What is Decentralisation?

When you browse the internet and view videos and posts on your favourite platform you make use of a centralised system. This system places the power of censorship, editing and deletion in the hands of a central entity. This could be Twitter, Facebook, Google, YouTube, Microsoft etc. At any given point these entities could delete everything they store and all the content you currently have access to would disappear. A more serious situation would be the manipulation of content delivery to users to influence a nation or censor out information they feel people should not have access to. This control of information is given back to the public at large through decentralisation.

The blockchain takes this information and places it all over the internet throughout the world. Everyone with a copy can verify the truth of the information stored and they all have the ability to agree to certain matters such as ownership, transactions and contracts. In a decentralised world no single entity can censor information and information becomes open to the world. Transparency both solves and creates many problems.

What is an NFT?

In the most simplistic sense, an NFT is a digital object that is completely unique and can both be owned by someone and prove ownership. This concept seems insignificant because the idea of ownership of real-world items is very different. A person may own a ring, TV or chair but this ownership is not easily verified and may bring many disputes when attempting to prove this ownership; how many family quarrels start over just this?

The exception to this would be assets requiring registration with government entities. This would include vehicles and homes for instance. The government creates and keeps a deed of sorts which serves to simplify the ownership of this item.

Ownership is important because it affords the owner certain rights such as the right to resell but also to earn royalties on the subsequent resale. This is where NFT’s come in.

The ability to prove something is in fact owned by someone and then to afford certain rights to that owner is made significantly simpler with NFT’s as the community at large will all verify the ownership and not a single entity or interpretation.

What is a smart contract?

A smart contract in essence is a set of rules that are executed without any interpretation when applied. This could take on the form of multiple logical applications such as governance, legal documentation, and profit-distribution.

This adoption of pure rule-based contracts is essential since it would eliminate the complexities around interpretation and all parties would agree upfront to the rules.

Imagine a situation where a rental agreement is signed, and a deposit is held in escrow until the tenant vacates the premises. The landlord and tenant could agree to hold this deposit and based on the outcome of an inspection done by two nominated persons the deposit (or part thereof) would transfer automatically to the tenant and landlord. This simple use-case shows the power of smart contracts. No disputes can arise as the contract was well-defined and agreed to at inception.

What is an AirDrop?

An AirDrop is much like Santa sliding down a chimney to bring you a special gift on Christmas Eve. The best part is you didn't have to believe in him or even write him a letter! AirDrops are when creators on the blockchain find wallets and deposit something into them. This could be cryptocurrency like Ethereum or Matic but can also be NFT's. Creators do this as a way of saying thank you to those people who showed trust and belief in what they are doing. At Open Earth Labs we identify these wallets by looking who owns our NFT's and when we do an AirDrop we select people from those wallets.

What are Gas Fees?

Gas fees are the fees someone pays to make use of the blockchain. These fees exist because there are certain nodes on the blockchain that constantly run calculations to ensure the integrity of the blockchain. These nodes do this to earn an income and this income is paid in the way of Gas Fees. Gas Fees can take on many varying shapes but the underlying concept is that they are the fees to do a transaction on the chain.