The letters NFT stand for Non-Fungible Token. So what does fungible mean? It isn’t a commonly used word, so let’s start there.
Fungible vs. non-fungible
Something fungible is not particularly unique and can be replaced by something just like it. If you have a dollar bill and your friend has one, you can swap them and nothing changes. Money is fungible. Gold is fungible. Even your coffee table can be replaced with an identical one.
You, on the other hand, are non-fungible. So is the Mona Lisa, or the old car your friend is restoring. There’s no one just like you and no painting just like the Mona Lisa. Unique things are non-fungible.
What is a token?
A token is a voucher that represents an item. A movie ticket is a token: it represents your right to enter the theater and see the movie.
Put the two together and a Non-Fungible Token is a unique representation of ownership. NFTs work as digital contracts, stored online and made tamper-resistant and secure with blockchain technology.
What is a blockchain?
A blockchain is a collection of transactions, like the lines on a grocery list. One list is a “block” of information. Tie your list to your neighbor’s list, and to another, and you get a chain of blocks: a blockchain.
The strength of a blockchain is that it isn’t stored on one computer. It’s stored on hundreds or thousands of them around the world. If one copy is changed, it’s compared with the others, the mismatch is spotted, and the change is rejected. No single person, company or government is in charge of that group of computers.
So an NFT is a unique digital contract, stored in many places at once.
How Vida Verde uses NFTs
Vida Verde Agroforestry uses this technology to offer Harvest Rights: a digital contract granting a share of the earnings from a portion of the harvest of a real, producing teak and avocado farm. Not a digital farm. A working farm beside the dormant Cosiguina volcano, overlooking the Gulf of Fonseca and the Pacific Ocean.
Because the farm’s earnings can be divided into small pieces, more people can take part. Harvest Rights are a contract between you and Vida Verde Agroforestry, and they can be traded on the Maven NFT marketplace, which specializes in NFTs that represent real-world assets.
Keep learning
- Read how Harvest Rights work on the Harvest Rights page.
- See the farm through a visitor’s eyes in David’s account or What a Visitor Saw at the Cosiguina Farm.
- Learn about the crops in Avocado and Teak: Why We Grow Both.
- Have a question? Ask us.
Harvest Rights carry risk and no returns are guaranteed. This article is educational and is not financial or legal advice.