The best way to explain a digital asset is that they are not physical or tangible objects like apparel and consumer electronics are.

Commonly purchased for their investment potential, the items that Ina has listed in her post are all intangible products that exist in a digital or virtual (i.e., in essence rather than in actuality) state.

Fairly new insofar as investment and payment vehicles go, as is the case with the other earnings that an individual garners, the IRS is now finding itself having to clarify that profits generated through the purchase, sale, and/or trade of digital assets is subject to income tax reporting.

What is a digital asset?
A digital asset is a digital representation of value which is recorded on a cryptographically secured, distributed ledger. Common digital assets include:

Convertible virtual currency and cryptocurrency
Stablecoins
Non-fungible tokens (NFTs)

Hope that helps.

I am a seller of apparel, but this is not digital.

The wording is confusing to me. I am not sure what to answer on this.

Using the word digital i think of phones or downloaded music ???