A fungible asset is something having easily interchangeable units, such as money. With money, you can exchange a $10 note for two $5 notes and the value will be the same. However, if something is non-fungible, this is impossible; it has unique features that prevent it from being interchanged with anything else. It could be a house or a one-of-a-kind picture, such as the Mona Lisa. You can photograph the painting or purchase a print, but there will only ever be one original.
When one mints an NFT, they are signing a specific file that makes it unique and original. That digital signature lives on the blockchain where all of its future owners and information will be recorded in a secure immutable way.
With that said, recent news about multi-million dollar purchases have stoked interest in this new approach because anyone can theoretically tokenize their work for sale as an NFT, It is impossible to do business without a clear understanding of property rights: Before someone buys a product, it must be established who has the right to sell it; and once a product has been purchased, it must be made clear who owns the product.
NFTs value stems from addressing this issue by providing parties with a shared understanding of what constitutes ownership. Through this process of market creation, items and services that were previously unavailable for purchase can now be purchased, as well as new ways of conducting business that are both more efficient and more valuable than ever before.
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