NFTs have transformed digital ownership. Here's everything you need to understand about non-fungible tokens.
What is an NFT?
NFT stands for Non-Fungible Token. Unlike Bitcoin where each coin is identical, each NFT is unique and cannot be replaced with another.
How NFTs Work
NFTs are tokens on a blockchain (usually Ethereum) that represent ownership of a unique item. The blockchain provides proof of authenticity and ownership history.
NFT Use Cases
- Digital Art: Provable ownership and royalties
- Gaming: True ownership of in-game items
- Music: Direct artist-to-fan distribution
- Real Estate: Tokenized property deeds
- Identity: Verifiable credentials
How to Buy NFTs
- Set up a wallet like MetaMask
- Buy ETH and transfer to your wallet
- Connect to marketplace (OpenSea, Blur, etc.)
- Browse and purchase NFTs
Risks
- Market volatility
- Scams and fake collections
- Platform risks
- Regulatory uncertainty