Fungible Tokens vs. Non-FungibleTokens

The crypto world has faced quite a revolution over the past few years. Several new terms are coined annually and bring up new opportunities for investors and customers to take advantage of and one of the most popular terms currently is the Token. Here we shall discuss the two main types of tokens present that are changing the course of the financial world altogether, which are the Fungible Token and the Non-Fungible Token (NFT). These tokens are not restricted by anything and are a legitimate tangible version of anything that can be considered a digital asset on the internet and can be used in several different ways, depending on the will and wish of the trader. As they can be used in several different ways, their applications also vary from industry to industry and buyer to buyer, such as being used as an asset in gaming or as a gateway in digitalized applications. Monkhub offers non-fungible token development services, and we are here to explain to you the meaning of these tokens and the key differences between them. 

There is no doubt that the blockchain has had a significant impact in being able to manage all sorts of data present in the digital world and another reason why this is so is also because of the presence of decentralization. The use of Interchangeable tokens such as Fungible Tokens makes this a whole lot easier. For the existence and translatability of various cryptocurrencies, there is an obvious requirement for fungibility, which is the main property of a digitalized currency. Basically, fungible tokens are interchangeable and their uniformity allows them to be used as any other currency, which makes them very relatable to how we use currency in our daily lives, as we also exchange currency for what item holds the same exchange value in return but in digital format. 

On the other hand, the Non-fungible tokens (NFTs) are slightly different as they represent assets that are considered unique or specifically as collectibles on the internet. For any input to have been considered an NFT, they compulsorily need to be unique, and this is important as this is the key feature that makes them available for a number of different opportunities. One of the most popular applications of the NFT world is the Etheruem based game, Cryptokitties that avails the use of collectibles with the use of such tokens. 

Properties of Fungible Tokens:-

• Interchangeable :

One of the key features of the Fungible Tokens is that they are interchangeable in value with an equivalent just as in the use of normal currency. Cryptocurrency is the biggest and most successful application of this interchangeability, as a particular coin, say Bitcoin, Dogecoin etc. can be exchanged with another Bitcoin of the same value, which does not make any difference in the transactional values or profits.  

• Uniformity :

Every token present, even if they are of the same type, has different properties, which maintains its integrity and uniformity.  

• Divisibility :

The Fungible Tokens can be divided into smaller parts and can be purchased or sold in larger or smaller parts, depending upon the financial standing of the trader and there are no restrictions on the number of coins to be purchased either. 

Properties Non-Fungible Tokens:-

• Compulsorily Unique :

NFTs are tokens that have to have their own unique and individual property and this is essential as this is the only way to make a digital item into an asset, such as in the game CryptoKitties.

• Non-Interchangeable :

They are non-interchangeable and can not just be exchanged with other Non-Fungible Tokens of the same value or type the way that Fungible Tokens can be interchanged. 

• Non-Divisible :

NFTs are assets and hence can not be divided in any way to be sold or purchased.

Summary :

NFTs can also be used to prove ownership of real items such as limited-edition handbags. They can also provide a trail of ownership, or “provenance” as it is called in the art world. If NFTs may be linked to tangible goods, they can also be linked to in-person experiences, such as a concert or private performance tickets. Future income from secondary sale transactions can be programmed routed to the original author or “minter” of that NFT, which is a very powerful feature of NFTs. This implies that even if an NFT is sold several times after the first, the original developer will still get money or royalties. If you are looking forward to create NFT, get in touch with us.