“NFT” is short for “non-fungible token.” They are unique tokens that verify ownership of digital assets through a blockchain.
NFTs can represent any kind of digital asset, from domain names to video game characters. In the art world, they’re most commonly associated with digital art.
In simple terms, “non-fungible” means the token can’t be exchanged for anything else. Where one ten-dollar bill is easily exchanged for another without changing the value, a non-fungible asset represents something unique in value, and where NFTs are considered, this uniqueness is verified and insured on a blockchain.
A blockchain is a shared, decentralized database made up of a list of records, or “blocks.” Each block consists of a set of data relating to itself and the previous block. This links each block together in a chronological order, preventing the data from being edited without a trace.
The data tracked on a blockchain typically relates to transactions. Therefore, it acts as an unchangeable ledger of who owns what and how much of it.