About blockchain, crypto, and Ethereum

To learn how to use Unfold to mint digital collectibles, visit Creating digital collectibles with Unfold. This guide intends to explain what digital collectibles are, and how they fit into the world of blockchain technology.

About digital collectibles

A digital collectible is a special digital file that has verifiable ownership. To create a digital collectible, you'll use blockchain technology to copy a file you own, such as a photo or video. People can track and verify ownership of the file by checking the blockchain the file is connected to.

What is a blockchain?

Blockchain technology is a technology used to securely link together a series of digital records. Each record is a block. When a new block is created, it’s added to the end of the series, forming a chain. There are many blockchains in the world. Unfold digital collectibles are part of the Ethereum blockchain.

When a new block is added to the chain, the block is generated using math that references all the blocks that came before. This mathematical bond down the chain makes blockchain very resistant to tampering. The data is called "immutable," meaning it can't be changed once written. This is important for ensuring that digital collectibles are one-of-a-kind items.

Blockchain is designed to decentralize transactions. Because the technology uses mathematical encryption to verify information, some aspects of transactions that would traditionally be verified by an intermediary, like a bank or market, are verified by the technology itself. This encourages commerce without these traditional intermediaries.

What is cryptocurrency?

Cryptocurrencies, or crypto, are digital currencies created using blockchain technology. Where physical currencies rely on physical security features to prevent counterfeiting, cryptocurrencies rely on a blockchain.

Because the blocks in a blockchain are bound together and encrypted, the blockchain becomes a record of every transaction ever made with the currency. This makes the ledger of all balances of crypto public, but anonymous.

The cryptocurrency of Ethereum, the blockchain that holds Unfold digital collectibles, is called Ether.

What is Ethereum?

Ethereum is a blockchain platform tied to a cryptocurrency called Ether (ETH). Third-party developers can build apps that use the Ethereum blockchain to authenticate and record online exchanges. 

Ethereum is the only blockchain platform currently supported by Unfold.

What are NFTs?

Non-fungible tokens, more commonly called NFTs, are unique digital items with blockchain-managed ownership. When you create a digital collectible with Unfold, it's created as an NFT on the Ethereum blockchain.

What are smart contracts?

Smart contracts are rules, listed as a computer program and contained in the blockchain. That makes the rules verifiable, and means they’re automatically executed when the contract is triggered. For example, a smart contract might say:

  • When a digital collectible is sold, it’s automatically transferred to the buyer
  • If funds for the purchase aren’t received within a set period of time, the digital collectible automatically returns to the seller

Crypto wallets and wallet providers

A crypto wallet is the part of a blockchain that records what digital assets and crypto currencies you own. There isn’t a central agency that manages wallets; they’re automatically updated by the blockchain as transactions happen. When you create digital collectibles with Unfold, they’re stored in your crypto wallet.

Because raw blockchain isn’t something people can easily interact with, it’s common to view your wallet through a wallet provider, such as the Unfold wallet manager. When you connect your wallet to a wallet provider, the wallet provider can help you view and interact with your wallet on the blockchain. But the wallet itself stays on the blockchain, so you can move it from wallet provider to provider. Moving your wallet to a new wallet provider is called importing your wallet.

When you view and manage your digital assets with the Unfold wallet manager, Unfold helps you interact with the contents of your wallet, but information about the wallet’s contents is never stored on Squarespace servers or associated with a Squarespace account.

Public keys and private keys

When you create a crypto wallet, you receive two values called keys. These values are similar to serial numbers. One is public and the other is private. 

The public key is used to identify your wallet in transactions on the blockchain. Every time you move cryptocurrency or digital assets in or out of your wallet, it’s done with your public key. If you sell digital assets through Blockchain-connected markets like Rarible and OpenSea, you’re identified by your public key.

Your private key is used to generate a secret phrase, which is how you access the wallet with a wallet manager.

Note: Never share your private key or secret phrase with anyone. Unfold and Squarespace will never ask for this information.

Secret phrases

Secret phrases are similar to passwords and are used to access digital wallets. Unlike passwords, they can’t be reset or recovered. 

Note: If you lose your secret phrase, you will lose access to your crypto wallet. No one, including Squarespace and Unfold, will be able to recover it for you.

Your secret phrase should only ever be used to import a wallet or to log back into your wallet provider. You should never share your secret phrase. Unfold and Squarespace will never ask for your secret phrase or private key, and they’re never saved on Unfold or Squarespace servers.

We recommend you write your secret phrase down on three pieces of paper and store them in three safe places. Some people also store their secret phrases digitally, using password managers. We recommend you closely review the security of physical and digital storage locations.

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