What is an NFT?
NFT stands for non-fungible token. An unique digital asset that is issued on a blockchain and holds the following characteristics: it’s permanent, cannot be replicated, cannot be counterfeited and the owner can prove that they own it.
For example, money is fungible. One $20 dollar bill is generally no different from another $20 dollar bill. When you lend someone a $20 bill, you don't need (or expect) them to return the exact same bill to you, so long as $20 is returned.
On the other hand, a painting is generally non-fungible. If you lend your friends a painting to hang in their house for a party, you do expect them to return the exact same painting back to you. NFT crypto tokens are like paintings. Each token is unique from all other tokens. Individual traits prove their individuality, and so they are non-fungible, much like other real-world assets like sculptures and basketball cards.
There are a number of digital assets out there such as art, collectibles, music, in-game items and even real estate. They can only have one official owner at a time and they're secured by the Ethereum blockchain – no one can modify the record of ownership or copy/paste a new NFT into existence.