NFT stands for “non-fungible token”. In plain English, it’s a one-of-a-kind digital asset.
When you own an NFT, you can choose to store it because you’re a long-term investor or simply because you love the art. You can also sell it and even turn a profit. For artists, NFTs allow them to enjoy creator royalties. On Magic Eden, each time an NFT sells and passes hands, the creator benefits from the preset royalties that they had agreed to. Use cases for NFTs are plentiful and are being explored in the field of games, music, real estate and more!
A prominent use case for NFTs is that it establishes proof of ownership for digital art, which opens up new avenues for artists.
NFTs are a whole lot of fun but you should be aware that they can fluctuate in value and are highly volatile. Please do your own research (DYOR) before you decide to buy any NFTs.
What is proof of ownership?
On a blockchain, you can track who owns an NFT. If you owned an NFT, the whole world would know that your NFT belongs to your specific wallet address, and no one can dispute your claim of ownership. Anyone can download an image of the Mona Lisa on Google Images but not everyone can own a certificate proving ownership of the Mona Lisa. This is the strength of digital ownership.
For normies (beginners to crypto), you might find the video below from Whiteboard Crypto helpful.