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While in 2020, the whole world plunged into a financial crisis due to the covid-19 breakout, many crypto enthusiasts made money sitting on their couches. Many of us learned the word cryptocurrency last year. So, what is it, and why cryptocurrencies are so much in the talks?  

Cryptocurrencies are virtual currencies/coins or tokens generated with the help of blockchain technology. It can be used for making transactions as you do with your regular currency. 

If you are a crypto enthusiast, you must have been hearing the term ‘Non-fungible tokens’ often nowadays. Non-fungible tokens or NFTs are the new hot topic in the cryptocurrency market. If you are unaware of non-fungible tokens, here is a brief idea about them and we will also understand why the crypto investors are going crazy about these tokens. 

What is NFT?

NFT or Non-fungible tokens are nothing but tokens that have a unique set of characteristics and cannot be interchanged with anything else. Here the fungibility concept is important which says that anything which is interchangeable is fungible and if not interchangeable, then it is non-fungible. 
For instance, two artworks can never be interchangeable as they are made by two different artists, the concept is different, the colors are different, the paintings themselves are completely different. They may have similar monetary value, but that also depends on the buyer. 

Basic features of NFT

They are scarce in the market. The NFT developers modify the tokens to increase their value. 

They are indivisible which means you cannot buy these tokens in multiple parts. It is not divisible like other cryptocurrencies – say for instance Bitcoin or Ether. 

It is created on the model of Ethereum – ERC- 721. 

The value of the NFTs is derived from their uniqueness. Each token is different and has different sets of characteristics. Thus they are interchangeable as well. 

What makes NFT so special?

Non-fungible tokens are becoming very popular in the gaming industry, amongst artists and other creative people. The reason behind the hype in its value is because of its unique characteristics. These tokens can be used for internal purchases in the games (mobile and online games). The tokens are being used by the artists to sell their art in digital format. 
In the recent past, the most expensive NFT was created and sold by Claire Boucher. He sold the ‘ WarNymph Collection Vol.1’ for a whopping $5.8 million. 

The reason behind this much hype in the value and popularity is due to the following factors:

These tokens can be easily transferred. They can be sold in different places/ platforms. 

It is hard to manipulate or fraud using NFTs. Thus it is secure with the Ethereum blockchain running for it. 

Non-fungible tokens have their owners. 

Non-fungible tokens are becoming popular for all the right reasons at present especially In the digital asset arena, gaming industry, and for collectibles. The uniqueness of the tokens sets them apart and that is what generates their value.