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What Is an NFT?

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NFTs are cryptocurrency tokens. They can be stored in a digital wallet for the short term or traded in marketplaces for long term profit. There is no limit to the number of NFTs one can own, and an investor can purchase any number of them. Some investors may hold them for a long time, while others may sell them very quickly for a profit.

NFTs are decentralized and secure. They can be used in a variety of products, such as e-books, cryptocurrencies, and even physical goods. Many of the digital items sold in cryptocurrency exchanges are sold as NFTs. One example is digital artwork. Artist Mike Winkelmann’s piece, entitled ‘Everydays – The First 5000 Days’, sold for $69.3 million in 2021, making it the third highest selling digital artwork ever sold at auction. Afterward, the market expanded into other types of digital art, including fashion, music, and collectibles. CryptoKitties, for example, let users trade virtual kittens in order to earn money.

NFTs have a limited supply, and their price depends on the demand for them. If you purchase a NFT and decide to sell it in the future, you can earn royalties if someone else wants to buy it. In addition, a NFT is not tied to any specific platform, so you can sell it to anyone without intermediaries. However, if you sell it later on and no one wants it, you may end up with less than the original price.

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