A Non-Fungible Token ("NFT") is a type of
cryptocurrency asset that exists on the blockchain, which is a
network that supports different types of cryptocurrencies (for
more information on the blockchain, click here). NFTs are programmed in a way that
limits their tradability, and usability to the confinements of the
blockchain itself. In the context of NFTs, the blockchain serves as
a distributed database that has the ability to store data, with a
consensus mechanism which ensures that each new entry complies and
is compatible with previous records of the same data, in the same
database.
Tokens, which are digital assets that are built on another
cryptocurrency's blockchain, are components of value linked to
digital properties. Likewise, tokenisation can exist in many
different of domains, from the well-known crypto-coin to equities,
securities, real estate, and contracts. The commonality, on the
other hand, was registered on a public blockchain, which means
