What are Non-Fungible Tokens (NFT) ?

You are living under a rock if you don't understand Non-Fungible Tokens (NFTs).

This is the hottest crypto (here to stay) trend of 2021, so please take some time to understand:

NFTs for beginners:

1. Let's clarify the definitions:

- Non-fungible:

A like for like replacement is fungible (eg. if I give you a 10$ bill and you give me another 10$ bill, this is a like-for-like replacement).

A non-fungible token is NOT a like-for-like replacement. For eg. if you give me your dog and I give you mine, it is not a like-for-like replacement (PS: only evil people would do such stuff)

- Token: store of value eg. casino chips (this token represents the cash that you have paid).

2. Now let's expand the definition of NFTs:

- Are unique collectable items such as Pokemon cards, Artwork, an image, GIF etc.

- These are non-fungible (i.e they are unique!)

- These are crypto assets. Crypto is basically an asset, which is build on computer algorithms.

3. Who would buy NFTs?

Well a lot of people.

Imagine if Picasso could digitise his first ever painting, stamp it as being the original (so that no forgery could take place) and start a bidding war online to sell it.

At what price would people buy that? I would say a lot.

4. So should you buy NFTs?

Like the real estate market, even in the NFT space, there will be good NFTs (eg. Picasso's painting) or bad NFTs.

So you need to identify:

- Good NFTs

- Good price

And, then make a call.

Credits: Akshat Shrivastava