Explainer-What are NFTs?

FILE PHOTO: Visitors are pictured in front of an immersive art installation titled "Machine Hallucinations - Space: Metaverse" by media artist Refik Anadol, which will be converted into NFT and auctioned online at Sotheby's, at the Digital Art Fair, in Hong Kong, China September 30, 2021. REUTERS/Tyrone Siu

LONDON (Reuters) - Non-fungible tokens (NFTs), a type of digital asset, have exploded in popularity this year, with NFT artworks selling for millions of dollars.

The trend is perplexing those who might wonder why so much money is being spent on items that only exist in digital form and can be viewed by anyone for free. Supporters view NFTs as the next phase in art collection.