NFT stands for Non-Fungible-Token. This is a unique token on the blockchain and is not exchangeable or shareable.
The "Fungible" in Non-Fungible-Token means that an NFT is not divisible or exchangeable. A regular coin or token, however, is exchangeable. A bitcoin can be exchanged for another bitcoin and they have the same value. An NFT is unique and thus not easily exchangeable for another NFT.
Because NFTs are unique, they can be used well as proof of ownership. In several games, players receive NFTs as rewards. These NFT are often on the Ethereum blockchain, allowing players to use their rewards in other games as well. In April 2021, NFTs were also sold as art by Yuga Labs. Bored Apes' collection consists of 10,000 unique apes, some sold at their peak for more than $300,000.
NFTs are also suitable for use in the real world. Because of the ability to set rules, for example, a resale percentage can be added to a transaction. As a result, the party who created an NFT always gets a share of the proceeds if it becomes worth more. With much art, this is not the case now. If a painting becomes worth more after ten years, often nothing of this increase in value goes to the artist. So NFTs provide an opportunity for artists to profit more from their work.
Since NFTs are on the blockchain, the transaction history is public. So for tickets for festivals and concerts, it is possible to check if tickets have been resold. Furthermore, projects where music rights are available as NFTs are also being worked on and ownership rights are also being put on the blockchain.
Most of the NFTs run on Ethereum. Various standards such as ERC-721 make it easy to create NFTs. For this reason, the value of NFTs is often expressed in ETH, the Ethereum blockchain's native token.
