In March 2021, a digital image by a graphic artist known as Beeple was sold in the form of a nonfungible token, or NFT, for $69.3 million, making him the third-most-valuable living artist. This was the first sale in history by a major auction house of a purely digital work of art that doesn’t exist in physical form.1
A nonfungible token is a unique digital asset authenticated by blockchain, the underlying record-keeping technology relied upon to certify its originality and ownership. NFTs first appeared in 2018, but the market took off in 2020 and early 2021 when a flurry of digital collectibles — including images, videos, music, trading cards, sports highlights, virtual real estate in online gaming worlds, tweets, gifs, and even viral memes — were minted as NFTs and traded as assets.