NFT is short for Non-Fungible Token. An NFT is a crypto token that acts as a digital certificate of ownership for some kind of linked asset.
“Fungibility” is the ability of an asset to be interchanged with assets of the same type. The British Pound is fungible because each GBP is interchangeable with any other GBP. A one-pound coin is interchangeable with any other one-pound coin. Whereas, Non-Fungible Tokens are not interchangeable because each one represents something unique.
NFTs can represent ownership of digital assets or even real-world assets. For example, an NFT can be a digital collectible Pokemon, an NBA card, a piece of digital art, a youtube video, or it can represent the official ownership of just about any unique physical asset like a painting or even a piece of real estate.
Through the power of the blockchain, digital NFTs can be owned and traded freely and peer to peer without a centralized clearinghouse. This makes them an amazing new type of proof of ownership.