Non- Fungible is in itself holding the term ‘one of a kind’ which clearly means that NFTs are unique and can’t be duplicated with anything else. These tokens in Crypto world are new rage and gradual rise in cryptocurrency has opened way for range of possibilities. Where NFTs or Non-Fungible Tokens are going with the flow of new technology as from art to music and pixelated images, these digital assets are being sold in market readily, and most of them are being sold for millions of dollar. This is so cause NFTs are unique in a manner that they can’t be replaced for any thing. For instance, Bitcoin isn’t an NFT, but it is that piece of an art which is non fungible and can’t be replaced.
NFT In Detail
Non- fungible is clearly meant to say one of its kind, whose place can’t be taken by any. These are those digital assets which represent real world objects as music, digital images, videos or any sort of collectable item which cannot be replaced. They are running on Blockchain Technology and are sold online most off for crypto coins and encoded as well. Although these are in market since 2014 but have being popular as of now. To this, you should be aware that recently, 101 Bored Ape Yacht Club NFT was sold off for $24.4 Million, which means round ₹179 crore, at Sotheby’s auction house.
One question which comes to the mind is that if NFT represents digital asset which is intangible then what for people are spending millions on it ? The answer to it is that they spend this much on NFT cause it provides the buyer with original item. In addition to it, built-in authentication is also there, which provides proof of ownership to the one purchasing such token. Where most of the buyers are interested in attaining such Digital Rights than the item.
Differentiation and Similarity Between NFT and Cryptocurrency
NFT is also running on the same technology (Blockchain)as Ethereum or Bitcoin does. This is the only similarity between NFT and Cryptocurrency.
Difference is that cryptocurrency could be traded for one another, having equal value, which means one rupee would always have worth of another rupee and in the same manner one Bitcoin would hold value for another Bitcoin, considering price fluctuations of them alongwith this as well.
But NFTs create a big difference as every single NFT has a digital signature through encoding, thereby making it next to impossible to be duplicated.
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