Appendix / Additional Reading

What is an NFT?

Nonfungible.com describes 'Non-fungible tokens (NFTs) [as] unique, digital items with blockchain-managed ownership. Examples of NFT use-case includes collectables, game items, digital art, event tickets, domain names, and ownership records for tangible assets. As of Oct, the total NFT market volume reached $134m with close to 5m sales. Other NFT use-cases may include:

• Physical art representation

• Digital real estate

• Tokenized real estate

• Intellectual property

• Warranties

• Insurance

• Badges

• Certifications

This is just scratching the surface. NFTs allow for representation of both digital and real-world value. Consider any unique asset (tangible or intangible) to which a crypto-token can be attached to ensure ownership, and that asset presents an NFT use-case. Because of the staggering potential for this crypto-class to be developed on Cardano, we believe it is important to build an infrastructure for unique asset tokenization in an open-sourced and modular way so that all solution contributors have the opportunity to monetize their unique contributions.

As NFTs become ubiquitous, we need a system on Cardano that ensures rapid development of emerging use cases, interoperability between all parties and that supports Cardano to become the de facto choice to launch NFT businesses.

Non-fungible tokens (NFTs) allow for representation of both digital and real world value. In fact, they blur the boundaries between digital and physical. NFTs can represent tickets to an event, physical art, digital art, in-game assets, badges, certifications and more… We're just scratching the surface. As NFTs become ubiquitous on Cardano we'll need patterns that ensure rapid development of emerging use cases and interoperability between all parties.

NFT Properties

NFTs will be distinguished through a set of properties:

• Lifespan: Different types of assets require different lengths of validity. For example, a sporting event ticket would need to be valid only after the conclusion of its corresponding event. IP ownership on the other hand would most likely be infinite until burned.

• Fractionality: Some NFTs need to be whole, meaning 1 token = 1 cryptokitty. On the other hand an NFT representing items of high value such as real estate could be fractional. See Cardano Multi-Asset Tokens Explainer

• Liquidity: How often does asset exchange occur? Generally real estate changes hands less frequently than something like trading cards.