x
What are NFTs? NFTs are an innovation in the blockchain/cryptocurrency space that allows you to track who owns a particular item - something tricky with digital files because they can easily be copied.
NFT's are essentially smart contracts that live on blockchains like Ethereum, Flow, or Tezos. They can also be programmed to give the creator a royalty of every sale of his NFT. Check out this simply explained video (above).
NFT stands for Non-Fungible Token - Non-fungible means that something cannot be exchanged for another item because it's unique. Simply put, it is a digital token that exists on the blockchain to record proof of ownership for the person holding it. Each token has its own unique metadata which can never be replicated or replaced for another.
An example to better understand this is: bitcoin is a fungible token, and each bitcoin has the same value. However, imagine you’re trading NFT collectibles such as CryptoPunks. One CryptoPunk NFT will have completely different traits and value to another.
A real-life example of this would be: A dollar is a dollar. It is fungible. A plane ticket, on the other hand, is non-fungible. Each plane ticket has different information and characteristics and can’t be swapped with another.
NFTs can be anything digital. Literally, anything can be tokenized, including a photograph that is special to you, one of your tweets, or a two-second video of yourself (yes, there are such NFTs).
Check out more information at NFT Plazas:
Video produced and simply explained by Xavier Decuyper - Check out more Simply Explained videos on YouTube.
Disclaimer: This video and article are for educational purposes only and not offered or intended to be used as legal, tax, investment, financial, or any other advice.
