Definition
A non-fungible token (NFT) is distinguishable from other tokens within its system rather than being interchangeable solely by quantity. It can represent an artwork reference, game item, membership or another defined object. The token record and the associated object are related but not necessarily the same thing.
How It Works
A contract records token identifiers and ownership or transfer rules. Metadata can describe an item and point to media stored on-chain or elsewhere. Transfers update the token’s recorded holder according to the contract. Standards help wallets and marketplaces recognize compatible interfaces.
Key Considerations
Owning an NFT does not automatically transfer copyright, commercial rights or ownership of a physical object. Those rights depend on the relevant terms and arrangements. Linked files can also become unavailable or change if the storage design permits it. Uniqueness of a token identifier does not guarantee artistic originality, scarcity of related copies or market value. Verify the collection, contract, metadata controls and actual rights rather than relying on a familiar image or collection name.