NFT (Non-Fungible Token) is a unique digital asset that represents ownership of a specific item or piece of content on a blockchain. Unlike cryptocurrencies (which are fungible—1 Bitcoin = 1 Bitcoin), each NFT is one-of-a-kind with distinct metadata and ownership history.

NFTs exploded in popularity in 2021 and are used for digital art, collectibles, gaming items, music rights, virtual real estate, and more. While often associated with JPEGs, NFTs have broader utility in proving digital ownership and authenticity.

Key Characteristics of NFT

  • Unique Ownership: Each NFT has a unique token ID and metadata
  • Provenance: Blockchain records entire ownership history transparently
  • Programmable: Can include royalties, unlockable content, or special utility
  • ERC-721/1155: Ethereum standards for creating NFTs
  • Cross-Platform: Can be bought, sold, or displayed across multiple marketplaces

Real-World Example

Beeple's digital artwork "Everydays: The First 5000 Days" sold as an NFT for $69 million in 2021. The buyer didn't receive a physical painting—just a unique token proving ownership of the digital file, recorded on the Ethereum blockchain.

Understanding NFT is easier when you're familiar with these related concepts:

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