*Nothing in this article constitutes professional, legal and/or financial advice.

Regular old money, cryptocurrencies, and common shares are all fungible, in that they are capable of being exchanged (or ‘traded’). What makes them truly fungible are their parallel values. A five dollar bill is equivalent to any other five dollar bill. What you see is what you get. It is a consistent (reliable) principle.

Why, then, are we hearing the term non-fungible so much these days? It is likely you’ve heard it in the context of a discussion about NFTs: non-fungible tokens. Nonetheless, non-fungibility is not unique to the digital world. Two other highly exchangeable commodities, diamonds and land, are also non-fungible, because they are capable of being unique, and that uniqueness can increase or decrease its value. In other words, this concept driving the popularity of NFTs is not new. We have long understood that something one-of-a-kind is without equal, and this feature has the capacity to boost worth.

NFTs contain digital signatures, rendering each to be wholly unique. Yes, they can obviously be reproduced or screenshotted, but there is only one original. Think of it as the difference between the original Mona Lisa, sitting in the Louvre, worth somewhere upwards of USD $800 million, and the reproduced print hanging in the dining section of your favorite Italian restaurant, worth, perhaps USD $160. With that said, when something is non-fungible, it also means its value as variable. Something worth a lot to one person, could be valueless to another. Even as history has unfolded, shifting values in societies have influenced the rankings of otherwise canonically beloved entities. Here today, gone tomorrow, so to speak. NFTs do not only constitute art; they include music, videos and even sneakers. This further cements the argument that value is subjective.

So, to fungible or not to fungible, that is the question. Or, more aptly, what is the safer investment? Do you stick to the fungible sphere, and invest in a financial instrument such as a stock or futures contract? Or do you acquire a non-fungible element, like a piece of land or digital artwork, and bank on its positive uniqueness to increase its value?

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