What is an NFT?

An NFT (non-fungible token) is a blockchain asset where each unit is unique and cannot be exchanged 1:1 with another. Unlike fungible coins such as Bitcoin, every NFT carries an on-chain identity, an owner, and content reference that is unique to that token. ERC-721 (Ethereum) and ERC-1155 (semi-fungible) are the dominant standards. Use cases include digital art (Art Blocks, CryptoPunks), in-game assets (Axie Infinity), profile-picture collections (Bored Ape Yacht Club), domain names (ENS), and tokenized real-world assets. Buying an NFT gives you on-chain ownership of the tokenID at a contract address; copyright typically remains with the issuer. Royalties are programmed into the contract so that creators receive a cut of secondary sales, although since 2022 several marketplaces have moved royalties from enforced to optional. The NFT market deflated significantly after the 2021-2022 peak, but functional segments — gaming assets, identity, domains, certificates — continue to find product-market fit.