by Steve Kaczynski and Scott Duke Kominers

In March 2021, a work of art called Everydays: The First 5000 Days sold for $69 million at Christie’s auction house. It’s not out of the ordinary to see eight-figure art sales, but this one received a lot of attention because the piece was sold as a non-fungible token (NFT)—an electronic record corresponding to an image that lives entirely in the digital world.

Put differently: Someone paid almost $70 million for a picture on the internet.

Since then, NFTs have started to permeate pop culture in various ways. They’ve been spoofed by Saturday Night Live and embraced by high-profile celebrities like rapper Snoop Dogg and NBA superstar Stephen Curry. As of this writing, there ...

Get Crypto: The Insights You Need from Harvard Business Review now with the O’Reilly learning platform.

O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.