What does fungible mean?

Fungible means that an item, asset, or commodity can be replaced with something of like kind when fulfilling a contract or paying a debt. Interchangeable goods are fungible; unique goods are non-fungible. Why Does Fungibility Matter? Fungible assets create a flow in trade and exchange processes because they're essentially equal in value.

Is money a fungible asset?

Goods and assets such as cars and houses that aren't interchangeable are non-fungible. Money is a prime example of a fungible asset because a $1 bill is easily convertible into four quarters or 10 dimes. Unique items such as cars, houses, or artwork are non-fungible. The line between fungibility and non-fungibility of some assets can be murky.

What is fungible currency?

Fungible’s meaning boils down to “the ability to be copied or replicated, and thus, interchangeable.” That means that fungible assets, such as the aforementioned U.S. dollar, have equal value to other dollars. Again, one U.S. dollar is interchangeable with any other U.S. dollar or its composite parts (pennies, nickels, dimes, etc.).