Blockchain makes sense for cryptocurrencies.

How do non fungible tokens work. For example one bitcoin equals one bitcoin and that presumably will never change. Other less popular smart contract platforms that support NFT creation are EOS Tron NEO and Binance Smart Chain. The most important reason for blockchain in cryptocurrencies is to avoid the double-spend problem which is spending the same item of digital currency twice.

We will focus on the Ethereum platform for now. Because the tokens have unique identities non-fungible they can be bought or sold while reducing the risk of fraud. This is a problem with fungible tokens because they are all interchangeable.

However an NFT is a unique kind of cryptocurrency and the blockchain database on which it is stored authenticates whoever the legitimate holder of that cryptocurrency. Bitcoin or Ethereum are fungible as in easily replaceable and exchangeable. But cryptocurrencies are fungible tokens.

NFTs on the other hand are non-fungible and trading for another NFT may or may not be possible since each can represent a different item and have different values. Ethereum is the platform where the majority of Non-Fungible Tokens are traded and created. They are permissionless and therefore anyone can create them buy them.

Where Are NFTs Stored. NFTs are digital directories that are powered by a blockchain system which is the same infrastructure that characterizes common cryptocurrency. Physical cash and cryptocurrencies are fungible which means they can be traded or exchanged for one another.

How do Non-Fungible Tokens Work. In the world of decentralized applications DApps they can be used to generate unique digital elements. When you buy a non-fungible token through an online platform known as a primary market transaction the platform takes a percentage cut and the creator takes the rest of the revenue.