Non-Fungible Token

In News

  • The term NFT (Non-Fungible Token) is often heard in the news. 

What is a Non-Fungible Token?

  • It is a digital asset that represents real-world objects like art, music, in-game items and videos. 
  • They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.
  • It was first created by inventors in 2014 and named ‘” monetized graphics”.
  • The key difference between cryptocurrency and NFT is that cryptocurrency is fungible. One can trade a Bitcoin for another Bitcoin but cannot do so for an NFT.

What are Cryptocurrencies?

  • Cryptocurrencies are “a stateless digital currency” in which encryption techniques are used for trading and these ‘currencies’ operate independently of a Central bank like the RBI, “rendering it immune from government interference”.

Source: ET