No, Cryptocurrency is not a part of NFT. NFT is a digital asset, and it is not based on or backed by any currency. Crypto is a form of digital asset that uses cryptography to secure its transactions and control the creation of new units.
Cryptocurrency and non-fungible tokens (NFT) are the two most popular applications that run on blockchain. While there is considerable overlap in how the two work, there are significant differences between them. The uses for cryptocurrency and NFTs also vary widely.
Cryptocurrency is an encrypted form of digital currency that relies on blockchain technology and doesn’t depend on financial institutions to verify transactions. NFTs are one-of-a-kind digital assets that are stored on a blockchain and cannot be duplicated or cloned. Let’s take a closer look at NFTs and cryptocurrency and examine their similarities and differences.
What are NFTs?
NFTs are unique digital assets that do not necessarily have a physical manifestation. They represent photos, music, videos, trading cards and other items. Nearly any digital asset, such as a collectible digital character, virtual real estate or original social media post, can be created and purchased as an NFT.
Among the somewhat esoteric NFTs is one created by Jack Dorsey — the original founder of Twitter — of the first message ever sent on Twitter.
NFTs are stored on distributed ledger technology, of which blockchain is a common type. The digital ledger lets NFTs be managed, bought and sold online. Every transaction on a blockchain is written to this digital ledger, which publicly records each NFT transaction to substantiate who owns the item.
NFTs commonly have a value attached to them, which can be set by the creator, that can increase or decrease based on market demand. Blockchain technology makes the ledger essentially immutable, which means it usually can’t be tampered with.
NFTs can be traded and exchanged for money, cryptocurrencies, or other NFTs—it all depends on the value the market and owners have placed on them. For instance, you could use an exchange to create a token for an image of a banana. Some people might pay millions for the NFT, while others might think it worthless.
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