What is an NFT?

By PlatformCrypto.eu editorial team · Last checked on 20 October 2026

Short answer

An NFT, or non-fungible token, is a token on a blockchain that cannot be swapped one for one with another, because each one is unique. It records ownership of something, such as a digital artwork or a ticket. The file itself is usually stored somewhere else.

Most crypto is fungible. One euro equals any other euro, and one bitcoin can replace any other bitcoin. NFTs break that rule on purpose. Every token carries its own identifier and its own owner, so no two are interchangeable, even when they belong to the same collection.

How does an NFT work?

A smart contract creates the tokens and keeps a register of which identifier belongs to which address. On Ethereum, the usual standard for this is ERC-721. When an NFT changes hands, the contract simply updates the owner in that register.

What the token points to rarely lives on the blockchain. Images, music and video are too large, so they sit on a web server or a storage network, and the token holds a link. If that file disappears, the token remains but points at nothing. It is worth checking where the media is stored before paying for it.

What do you actually own?

You own the token. Copyright in the artwork normally stays with the creator, and what you may do with the work depends on the licence attached to the collection. Some allow personal display only; a few grant commercial rights.

People use NFTs for digital art, collectibles, in-game items, event tickets and memberships. Some NFT projects later launched a regular token: Pudgy Penguins, for instance, now has PENGU, which is fungible and trades on exchanges like any other coin; see buying Pudgy Penguins.

How does MiCA treat NFTs?

The EU's crypto rules exclude crypto-assets that are unique and not fungible with other crypto-assets. The regulation looks at substance rather than labels, though. NFTs issued in a large series, or split into fractions, may be treated as fungible and fall under MiCA after all. Licensed exchanges mostly deal in ordinary coins; our list of MiCA-licensed exchanges shows who holds a licence.

What are the risks?

Selling can be hard. Each NFT needs a buyer who wants that particular item, so there may be no buyer at your price, or none at all.
Copies and fakes. Anyone can mint a token from someone else's image. Check the contract address published by the real creator.
Wallet drainers. Fake mints and "free NFT" offers can ask you to sign a transaction that empties your wallet. If that happens, read what to do when crypto is stolen.
Fees. Minting, buying and moving NFTs all cost gas fees.

How do you buy one?

The platforms we compare do not sell NFTs. You buy them on an NFT marketplace using a self-custody wallet, usually paying in ETH or SOL. Buy that crypto on a licensed exchange first: our comparer shows where your euros go furthest. Then withdraw it to a wallet that displays NFTs; the wallet guide compares the options.