The online world is going wild over a relatively new form of digital collectible called NFT, or non-fungible token. Basically, it’s a one-of-a-kind item that only exists in the digital world.
In recent weeks, digital artists, musicians, and even Taco Bell have sold NFT’s for combined millions of dollars.
“We have Mark Cuban talking about them, we have artists starting to use them,” started Anthony Citrano. He’s building an online NFT marketplace called Acquicent, which will link digital tokens with physical items too.
NFT’s are purchased with cryptocurrency.
“There’s a tremendous amount of excitement so we’re seeing prices go up… that coupled with the increase in cryptocurrency have driven these prices very high,” explained Citrano.
Still confused? It all comes down to scarcity. Once you understand the difference between fungible and non-fungible, it (sort of) makes sense.
A rare original arcade game console is non-fungible. In other words, you can’t just make another one. It’s unique.
A gaming chip from a casino that’s since been imploded is non-fungible.
A $20 bill is fungible. They’re basically interchangeable – if you lent it to someone you wouldn’t ask for your specific bill back.
The most interesting part about NFT’s is that unlike real-world originals, which need to be verified by an auction house or expert, ownership and authenticity of NFT’s is public and provable thanks to the blockchain. The same technology that powers cryptocurrency.
“You can just show on this public blockchain this mine… and I think that’s really appealing to people,” concluded Citrano.
Of course, like anything else that’s hot and new and a bit confusing, there is a lot of hype, along with the potential for fraud. Keep in mind, NFT’s can also lose their value. If you want to check out some NFT’s, OpenSea is one of the biggest online marketplaces for them.