What are NFTs and why did one sell for millions?

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Non-Fungible Tokens Explained: A High-Value Digital Asset

Non-fungible tokens (NFTs) are a distinct type of digital asset recorded on a blockchain, a distributed ledger system maintained across networked computers. This year witnessed a significant surge in the popularity of NFTs. A notable example occurred in March when American artist Beeple's digital artwork achieved a sale price of nearly US$70 million (RM296 million) at Christie's, marking the first instance of a major auction house selling art that exists solely in a non-physical form.
The Nature of NFTs on the Blockchain

NFTs represent unique digital items, where each token is distinct and cannot be interchanged on a like-for-like basis. The underlying blockchain technology serves as a transparent and immutable record of ownership and transaction history for these digital assets. This technological framework underpins the verifiable scarcity and authenticity of NFTs, differentiating them from traditional digital files which can be duplicated endlessly.
The Phenomenal Rise in Popularity

The year 2021 saw NFTs transition from a niche concept to a widely discussed phenomenon. This increased attention was driven by a combination of factors, including high-profile sales and growing interest from artists, collectors, and investors in the potential of digital ownership. The ability to own a verifiable piece of digital art or a unique digital collectible resonated with a growing online audience.
A Record-Breaking Sale at Christie's

The sale of Beeple's digital artwork at Christie's for close to US$70 million in March was a landmark event. It demonstrated the significant financial value that can be attributed to digital creations within the NFT ecosystem. This auction house sale was particularly noteworthy as it represented the mainstream art world's acknowledgment and validation of digital art as a collectible and investment asset.

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What are NFTs and why did one sell for millions?

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