NFT, or non-fungible token is a type of digital asset that represents ownership or proof of authenticity of a unique item or piece of content, such as a piece of artwork, music, or video.
Unlike cryptocurrencies such as Bitcoin, which are fungible and interchangeable, NFTs are unique and cannot be exchanged for another identical item. This uniqueness is ensured through blockchain technology, which creates a permanent, tamper-proof record of ownership and authenticity for each NFT.
The use of NFTs has gained popularity in recent years, especially in the arts and collectibles space, as it allows creators to monetize their digital creations in a way that was previously not possible. Buyers of NFTs can hold them as investments or simply enjoy them as one-of-a-kind collectibles.
The buying and selling of NFTs typically take place on decentralized marketplaces built on blockchain platforms, such as Ethereum. The transaction process involves the use of cryptocurrency, such as Ether, to purchase the NFT. The NFT is then stored in the buyer’s digital wallet.