NFT20 is a decentralized exchange protocol that converts NFTs into ERC20 tokens, providing liquidity and facilitating trading on platforms such as Uniswap and Sushiswap. By depositing NFTs into designated pools, users receive ERC20 tokens representing fractional ownership, which can be traded or used to redeem other NFTs from the pool. The protocol supports Dutch auctions for unique NFTs and offers direct NFT-for-NFT swaps within pools.