What are NFTs?

An NFT (non-fungible token) is a digital asset that is verifiable on blockchain technology. The assets can include artwork, music, or in-game assets such as unique avatars. Because they are unique, NFTs are becoming sought after as collectibles.

What about fungible? When something is fungible, like a dollar bill, it is equivalent to, and can thus be exchanged for, any other dollar bill. In contrast, a non-fungible token is a unique asset in digital form that cannot be exchanged for any other NFT.

In contrast, a non-fungible token is a unique asset in digital form that cannot be exchanged for any other NFT. This means that every NFT is a 'one-of-a-kind' item. NFTs are transferred from the owner to another using blockchain technology, which creates a digital trail from seller to buyer that verifies the transaction. This encodes the unique ownership rights to the buyer (new owner).