The landscape of digital art is being upended by NFTs, or non-fungible tokens, to the point where it’s difficult not to have heard the term in passing. But what is an NFT? Why are people spending millions of dollars on JPEGs? And could it change how microtransactions in games work?
Just what is a Non-Fungible Token?
First and foremost, NFTs are intrinsically tied to the blockchain–an online ledger that is maintained by thousands of users globally through the process called mining. Transactions on the blockchain aren’t centralized, so it’s difficult (but not impossible) to edit the ledger to make fraudulent transactions. This is the same technology that powers cryptocurrencies like Bitcoin ($BTC), Dogecoin ($DOGE), and Ethereum ($ETH) around the world. NFTs exist on various blockchains, but most being sold are found on the Ethereum blockchain. Unlike the currency, however, they’re non-fungible. That means that one NFT is entirely unique from…