A non-fungible token represents ownership of a unique item. Fungible means interchangeable. A dollar bill is fungible. One Bitcoin is fungible with another. An NFT is not. Each token has a unique identifier and a unique owner. That makes NFTs suitable for digital art, collectibles, game items, domain names, and event tickets. The token lives on a blockchain, usually Ethereum, and the ownership record is public.

The NFT boom of 2021 turned into a speculative frenzy. Digital artworks sold for millions. Profile picture collections became status symbols. Then prices crashed. Most NFT projects from that era are worthless today. The technology still matters. NFTs solve a real problem: proving ownership of a digital asset without a central registry. Game developers use them for items that players can trade across platforms. Artists use them to sell directly to collectors and earn royalties on secondary sales. Event organizers use them for tickets that cannot be counterfeited. The hype faded. The use cases did not.

NFT characteristics

• Unique — each token has a distinct identifier
• Indivisible — you cannot own half an NFT
• Ownership record — stored on a blockchain
• Metadata — often points to an image or file stored off-chain

Not everything needs to be an NFT. A database works fine for most ownership records. NFTs make sense when you need public verifiability and no central authority.