Non-Fungible Tokens (NFTs) in Accounting: The Digital Asset Explained

Synopsis

The development of the internet and blockchain technology have given rise to cryptocurrencies and non-fungible tokens (NFTs). There are slight differences between non-fungible tokens and cryptocurrencies. While cryptocurrencies are fungible (mutually interchangeable), NFTs are unique and there can only be one copy of a non-fungible token in existence.

Non-fungible tokens are representations of real properties in the digital realm beyond digital artworks, music clips, or videos. The prefix “Non” which is attached to “non-fungible tokens” simply suggest that as assets, non-fungible tokens cannot be mutually exchanged with other assets because they are unique and can never have an original replica or equivalence. This book examines how NFTs are used in real life.