Capterra Glossary
Nonfungible Token (NFT)
A nonfungible token (NFT) is a digital asset that represents unique physical or digital items such as real estate, videos, music, and artwork. Nonfungible tokens are bought and sold online and securely recorded on a digital ledger system known as blockchain, similar to cryptocurrencies. Each token contains an nontransferable, irreplaceable identity to differentiate it from other NFTs. Therefore, it's impossible for one NFT to be of equal value to another.
What Small and Midsize Businesses Need to Know About Nonfungible Token (NFT)
Small and midsize businesses can use NFTs to grant customers access to digital content. Since NFTs operate on a blockchain, they can always be traced back to their original owner or creator. This helps deter unauthorized distribution of digital products and services.
Companies can also issue NFTs that customers can redeem later for product or service discounts. This incentivizes customers to continue buying their products and services, increasing brand recognition and customer loyalty.