Fungible items are those that can be replaced with another copy, such as a print of a famous piece of artwork. However, a non-fungible item is truly unique, such as the original piece of art itself.
A Non-Fungible Token (NFT) extends this concept to the blockchain, where proof of ownership of a non-fungible item can be added in the form of a token (Sharma, 2021).
This token, or proof of ownership, exists in the digital ledger and can thus be recorded, traded, sold or given away just like a cryptocurrency (etherium.org, 2023). While cryptocurrency itself is a form of token, it is fungible, with one Ether on Etherium no different than any other.
The process of ‘minting’ an NFTs is simply adding them to the digital ledger via a process of smart contracts (ibid.).
What are their impacts of NFTs on digital arts creation and ownership?
Initially created in 2014, the use of NFTs for digital art boomed in 2021 with high profile NFTs and collections such as the Bored Ape Yacht Club becoming available on digital marketplaces (Amure, 2023).
While the proponents of NFTs boast the benefits of being able to trade digital art with the same scarcity and proof of ownership as physical art, many are keen to criticise the process as a fad or even scam (O’Sullivan, 2021).
References
Amure, T.O. (2023) Bored Ape Yacht Club, Investopedia. Available at: https://www.investopedia.com/bored-ape-yacht-club-6747275 (Accessed: 31 May 2023).
ethereum.org (2023) Non-fungible tokens (NFT), ethereum.org. Available at: https://ethereum.org/en/nft/ (Accessed: 31 May 2023).
O’Sullivan, A. (2021) Reason: Are NFTs Dumb, a Scam, or Secretly Useful?, James Madison Institute. Available at: https://jamesmadison.org/are-nfts-dumb-a-scam-or-secretly-useful/ (Accessed: 31 May 2023).
Sharma, R. (2021) Non-Fungible Token Definition: Understanding NFTs, Investopedia. Available at: https://www.investopedia.com/non-fungible-tokens-nft-5115211 (Accessed: 31 May 2023).
