What is a Non-Fungible Token(NFT)?
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You may have heard the word "blockchain" over the previous few years. Blockchain Technology has developed as a cutting-edge record-keeping system, most notably as the foundation for the Bitcoin cryptocurrency. The unique aspect of blockchain is that it is decentralized: no single person or company controls it, and it is transparent because the ledgers can be viewed by anybody (if you know where to look). Blockchain technology is not restricted to cryptocurrencies and can be used in a variety of applications. The most recent high-profile illustration of this emerging technology's broad applicability is non-fungible tokens (NFTs).
What is an NFT?
NFT stands for non-fungible token, a one-of-a-kind, non-transferable data unit kept on a digital ledger (blockchain). NFTs are digital tokens that can be used to show who owns one-of-a-kind items. Owners can tokenize assets like artwork, collectables, and even real estate with them. The tokenized entities can only have one legitimate owner at a time, and the Ethereum blockchain protects them, meaning no one can change the ownership record or create a new NFT. NFTs and Ethereum are solutions to some of the internet's existing problems.
How does NFT Work?
NFTs are usually stored on the Ethereum blockchain. Digital artefacts that represent both physical and ethereal items are used to generate an NFT. You can develop an NFT to meet demand if someone wants to possess it. Twitter co-founder Jack Dorsey, for example, sold his first tweet, the first tweet ever sent on Twitter, as an NFT for more than $2.9 million.
NFTs are a risky investment because their future is unknown, and we don't yet have an extensive history of transactions to compare them to.