Definition ∞ Fractional digital ownership refers to the ability to own a portion or share of a larger digital asset, rather than the entire asset itself. This is achieved by dividing a non-fungible token or other unique digital asset into multiple fungible tokens. Each fungible token represents a specific percentage of the underlying asset. This mechanism lowers the barrier to entry for expensive digital assets, making them accessible to a wider range of investors. It democratizes access to high-value digital items.
Context ∞ The conversation around fractional digital ownership frequently highlights its role in enhancing liquidity and price discovery for illiquid assets like high-value NFTs. Discussions include the legal implications of shared ownership and the governance models for collectively owned assets. The process enables broader participation in markets for digital collectibles and virtual real estate. This approach broadens investment opportunities within the digital asset space.
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