What Is Token Fractionalization and How Does It Affect NFTs?

Token fractionalization is the process of dividing a single, high-value NFT into multiple, smaller, fungible tokens. This allows multiple investors to own a piece of an expensive asset, lowering the barrier to entry and increasing liquidity.

For example, a rare piece of digital art can be split into 1,000 fungible tokens, making it accessible to a wider market.