NFT (Non-Fungible Token)
A unique digital token on a blockchain that certifies ownership of a specific item, such as art or a collectible.
An NFT is a one-of-a-kind token recorded on a blockchain, unlike cryptocurrencies, where each unit is interchangeable. It is used to represent ownership of digital, and sometimes physical, items like artwork, music, or in-game assets. The blockchain provides a verifiable record of who owns the token, though it does not necessarily grant copyright or physical possession. NFT prices have been extremely speculative and volatile, with many losing most of their value. Treat them as a high-risk, niche holding rather than a core investment.
Example
You buy an NFT of a digital artwork for $400; the blockchain records you as its owner, but its resale value could swing wildly or collapse.
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Related terms
Cryptocurrency
A digital asset secured by cryptography and recorded on a blockchain, operating without a central authority.
Blockchain
A distributed, tamper-resistant digital ledger that records transactions across many computers.
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