Non-Fungible Token (NFT)
NFTs are cryptocurrencies that are not all the same. This means that they don’t all have the same value, and they can’t be easily replaced or exchanged with each other.
What Are Non-Fungible Tokens?
Non-fungible tokens are a type of cryptocurrency that is not equal to any other unit. They are often used to represent ownership of an underlying asset, and can be exchanged for other non-fungible tokens or traditional currencies.
NFTs can be used to represent digital art, like in the game CryptoKitties. In this game, users can trade cartoon cats by exchanging the corresponding tokens. Another example of NFTs is tokenizing real-world assets like equity or commodities to make them tradable digitally. In this case, tokens represent unique assets and are thus non-fungible.
If a token is used for illegal activities, it can become non-fungible. This is because exchanges and other service providers are likely to not accept it.