An NFT, or a ‘non-fungible token’, is a particular type of blockchain token that cannot be divided into smaller fractions (unlike currencies). NFTs are a significant innovation for the internet at large, as they help represent ownership of unique digital assets on the blockchain. This is in stark contrast to the way digital assets have been historically understood, in that it is quite easy to make multiple copies of a digital file, unlike in the physical world where replicating a unique object down to its finest details (especially art) is nearly impossible.

Fungibility is an economic idea, where if an object is fungible, it means that it is easily replaceable by another object of the same specification and worth, and that it holds no unique value on its own. Commodities and currencies are a good example of fungible objects. Yet many things that are important to human beings and culture, such as relationships, art and ownership are fundamentally unique and not easily replaceable. NFTs, hence, offer a model of replicating the properties of these real-world, non-fungible objects on the internet -- making it easy to track their publication, movement and ownership.

NFTs have exploded into popularity mainly because of artists being able to distribute their work at scale, and getting paid in full with little to no involvement of any middlemen. This is, in fact, a radical improvement in how viable a creative field was to anyone who desired to work in it. However, we must realise that this is still a nascent application of what NFTs have to offer. At their essence, NFTs provide a secure receipt of unique ownership of anything that can be represented digitally. As we move towards digital networks which capture and express the value of the real world in more and more detail, we will see new and powerful ways in which NFTs can be used, ranging from spaces like art, media and publication to real estate, transportation and fashion.

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