In the world of finance and technology, few terms have recently garnered as much attention and curiosity as NFTs or Non-Fungible Tokens. These unique digital assets have captured the imaginations of both investors and artists alike, sparking a frenzy of interest. However, with great hype often comes great confusion. Many retail investors struggle to understand what NFTs are, how they work, and why they matter.
In this article, we will unravel the mysteries surrounding NFTs, shed light on their differences from cryptocurrencies, and share why they are more than just digital images of apes and punks.
The Basics: What is an NFT?
Let’s start with the fundamentals. NFT stands for Non-Fungible Token. Unlike cryptocurrencies such as Bitcoin or Ethereum, which are fungible and can be exchanged on a one-to-one basis, NFTs are unique and indivisible. Each NFT represents ownership of a distinct digital or physical asset, such as art, music, virtual real estate, collectibles or even real-world items.
How Do NFTs Work?
NFTs operate on blockchain technology, which is a decentralized and transparent digital ledger. Each NFT is recorded as a unique token…
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