Dummies’ Guide To NFTs

Dummies Guide To NFTs

Gertrude Hetzel , Staff Writer

What exactly is a NFT? You may be thinking of a non-fungible (unique) token to be a token used for arcade games, but you’re wrong. An NFT is a unique digital code on a blockchain that represents a digital item such as art or music. NFT’s contrast greatly from cryptocurrencies. This is because cryptocurrencies are fungible meaning they can be traded. 

NFTs changed crypto by making each token unique and irreplaceable. Not any non-fungible token can be equal to another.  

There are many different types of NFTs which are stored and secured on the public blockchain. Most NFTs are created on the Ethereum blockchain, which is based on accepted token standards to increase composability. 

The distinct build of each NFT makes it an ideal way to digitally represent physical assets like real estate and artwork. Since NFTs are based on blockchains, they can work to remove mediators and connect artists with audiences; they can also be used to care for identity. NFTs can simplify transactions and create new markets.

There are many different types of NFTs which are stored and secured on the public blockchain. Most NFTs are created on the Ethereum blockchain which is based on accepted token standards to increase composability. 

Types of NFT data units may be associated with digital files such as photos, videos and audio. The NFT can be compared to a fingerprint because they cannot be replaced and everyone is different.

Sources:

https://www.investopedia.com/non-fungible-tokens-nft-5115211

Image courtesy of ghsexplosion.com.