Let’s answer together.

Fungibility

While this may sound complicated, it is actually not. The concept of fungibility is simple – it refers to the things we own and use in our daily lives in modern society. These can be either real or virtual assets. For instance, a dollar in your bag or the BTC in your wallet is a case in point; both are easily replaceable.

NFT

The non-fungible token is an absolute game-changer for crypto.

Such tokens, for the most part, are based on the ERC-1155 standard. They guarantee non-fungibility. So, they cannot carry out a usual currency role.

The ERC-20 introduces a standard for Fungible Tokens. In other words, this fact allows you to issue identical tokens that can serve as a real currency. This makes the idea of using an ERC-20 token for something outstanding or exceptional absurd.

Let’s Dream Up a Little

Now, across the gulf of space and time, on another planet called "Anything is possible", someone issued 21.000.000 of NFTs on the ERC-1155 standard. Just for the sake of this discussion, do you know, hypothetically, what will happen with non-fungible tokens then?

The answer is obvious: one token would be easily replaced by another. This leads to an unexpected discovery: tokens would act as a real currency in a very natural way – a move that will subsequently draw the wrath of regulators.

Can an ERC-20 token with a permanent total supply of 1 be an NFT? Users were recently asked this question on Twitter. Approximately half of the people who responded said "Yes", about 30% of respondents said "No". Others abstained or did not answer.

Bottom Line

Of course, we are not claiming any facts; all we have here are guesses and assumptions. Realistically, none of that matters; what matters is that NFT is a big hit now.