Nike is using NFT to combat counterfeits. That's taking a mass-produced product that's basically the same as a thousand identical products, and making each unique, by tracking the serial number.
This is almost the opposite of algorithmically produced NFTs, which are unique images generated by a computer program. Except, these things only exist purely as data, and no human was involved in producing the final product.
What happens to an NFT you bought if the project you bought it through ends? The data remains, and I suppose the program keeps running on the VM, but the programmers quit, or go to prison, or something.
Is there really anything in life that is non-fungible?
You'd think human beings are unique, but, when we're reduced to labor, we become more fungible.
You'd think land is non-fungible, but that only exists with force, usually from a government. When two governments disagree about who owns that "non-fungible" land, they will go to war over it.
Without violent force to maintain the ownership of the land, the land becomes more like a shared resource. It's not perfectly fungible, but it's more like a commodity.
Is fungibility a kind of social agreement, to treat unique objects as if they are identical?
Even seemingly identical physical objects occupy different places in space. Even fungible physical objects wear out at different times, so one may go out of existence before another. So, you have the phenomenon of nearly fungible objects, like coins, becoming rare and unique as they are lost, damaged, or destroyed.
In sufficient quantity, unique items stop being treated as particularly unique. Tie dyed shirts are inherently unique, but their production, display, and sale, treat them like fungible objects.