Have you seen headlines and wondered, “what are NFTs?” You aren’t alone. This acronym seemed to come out of nowhere, now even celebrities are talking about it.
We aren’t here to say whether this is a good thing or a bad thing, or a passing trend, but to explain what it means and what they are to the average person who’s curious.
What does NFT mean?
NFT stands for Non-Fungible Token. What does Fungible mean? Fungible mean interchangeable, like currency. Here in Canada, you can switch or exchange 5 one dollar coins (Loonies) for a five dollar bill and it is equal. Thought NFTs are cryptocurrency, they are non-exchangeable because each one is a unique digital asset.
What Are NFTs?
As we’ve already stated, NFTs are unique digital assets. But what does that mean? The best way to compare it is to look at the art world. If you go to a gallery you can see priceless works of art by famous painters and sculptors. These are original pieces of art. After you view the one-of-a-kind works of art, you might want to take home a souvenir to remember it. You might buy a postcard or a poster of the art, but that is merely a copy of the original, not the original.
NFTs are the originals, and anything else resembling them are just copies. So, people are now buying digital art in the same way they buy physical art. They are investing in art, which is now worth billions of dollars. Seems baffling, but it’s true.
Will these digital assets continue to gain value for the buyer? We don’t know. The world of NFTs is so new, we do not known what the future holds.
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