Non-fungible token(NFT) has been the talk of the town since the turn of the new year, especially with the sale of Beeple’s US$69 million NFT art at Christie’s. NFTs was largely popularized by Rare Pepes, Crypto Punks & Cryptokitties on the Ethereum blockchain in 2017 but do you know that the history of NFTs can be traced back to 2012 on the Bitcoin blockchain(Colored Bitcoin). Where Yoni Assia discussed coloured coins as unique and identifiable and was part of the “Genesis bitcoin transaction”.

So what exactly is a Non-fungible token?

Fungibility is most commonly defined as “an item is replaceable by another identical item”. E.g. Fiat currencies, a 20 dollar bill has the same value as another 20 dollar bill where users do not differentiate them and counterparties do not possess any discrimination against one over another 20 dollar bill. Non-fungible is the exact opposite of this, where each item is unique on its own, and people place different value on each item. In the physical world, items that are non-fungible ranges from artwork, music, to personal items where they are largely non-fungible. Non-fungible token represents ownership of a digital asset that is unique on its own on the public blockchain. A more in-depth discussion about what NFTs are can be found in the NFT bible.