I have an NFT for the bottom-most turtle.
I was thinking I could create an NFT for a pixel on the internet (I could host it on its own site), then put that NFT in a box and create an NFT for that box, then box that and create an NFT for that, and so on and so on. I would own the original NFT but allow other people to box and create new NFTs around my burgeoning creation. It would be like a pyramid scheme but without anyone having to pay money to anyone and maybe one day people will be willing to buy some of the early NFTs in that lineage.
This is my idea, who wants in?
You don’t. Why does this matter?
I could hire an airplane to fly a banner over the city claiming I wrote the SMDB’s first post.
The fact that one claim takes the form of a banner in the sky and another claim has been made electronically and then tokenized have equal value in establishing the truth of that claim.
The NFT validates that you made the claim. Presumably, for the sky writer, there is a paper trail validating that showing you made the claim that way. Neither of those validates the factual basis for the claim itself. It’s a fundamental misunderstanding of what NFTs are.
That’s also separate from the debate of whether NFTs are actually worthwhile, but that’s outside the scope of GQ.
I’d suggest taking the pixel out of it. Make an NFT of the sequence of bytes with zero length. Then do an NFT of that NFT. And then an NFT of that NFT. Ad infinitum.
This is the part I’m most confused by I think. Correct me if I’m wrong, but the NFT isn’t technologically linked to the artwork itself, is it? In one example, it’s only linked to a URL where the artwork may or may not be hosted. As far as I can tell, it doesn’t even have to be that. Am I correct in thinking that to make a claim about being the only rightful owner of the artwork using an NFT you need two components: (1) proof through the blockchain mechanism that you own the specific token and (2) a claim or evidence by a trusted (by you or anyone you’re trying to convince) authority that the token actually represents the ownership?
Right now there’s a token representing ownership of that $69m digital artwork for example. Presumably there’s nothing stopping me from creating a new NFT and claiming that it represents ownership of the same artwork. The only difference between those claims is that one is made by a set of organizations (Christies auction house, etc.) that has more credibility in making this claim than I do. If that set of organizations lost interest in continuing to make that claim (or worse, suddenly started claiming it didn’t represent the artwork after all but in fact a stale bag of Cheetos they just found in an old cabinet) then I suppose any residual value of the NFT would only be based on being able to sell it to people who reject Christies change of heart or just thought the publicity around that specific NFT was cool?
I guess my confusion is that it seems to me you still need to trust the originator authority that makes the claim that the NFT means something. And in that case I’m not really fully grasping what the point of the NFT is. What problem does it solve that just asking Christies “hey, does John Smith own this?” and them saying “yes” doesn’t? And in the more general sense of representing ownership, what problem does it solve that law, contracts, etc. that seem to work for everything else doesn’t?
It can be.
One example is an NFT containing thousands of images made by one artist. No reason you can’t put those bits themselves into the NFT.
But here’s the thing - that particular piece of digital art belongs to the person with the NFT but the copyright is still held by the artist. So, a while later, if that artist separately sold a copy of one of those thousands of images, that’s perfectly valid.
Let’s say Paul McCartney recorded a special copy of “Let It Be” just for you and there was plenty of documentation proving you owned it. That doesn’t mean you own the song - just that one copy of it. You “own” that particular copy of the art but whoever owns copyright can still copy it again and again.
Or maybe he just gives you a key where there is a special soundbooth where you, and only you, can listen to that particular recording. Nothing stopping him from demolishing that building or changing the locks. Depending on any signed agreements on ownership rights, that may entitle you to sue for damages but there’s nothing to physically stop him from doing that.
Sure, and that’s true for anything. Our economic system is based on mutual trust (whether that’s between individuals or with a government or bank or whatever).
None, really.
There’s a narrow technical issue it handles but nothing earth shattering and nothing that couldn’t really be effectively replicated by other means.
Basically the same as cryptocurrencies. For most people, they don’t fundamentally handle transactions in a way that can’t be handled via traditional currencies. But there are a few features some people like.
And like baseball cards and some cryptocurrencies, it does seem that NFTs are currently in a speculative boom that is unsupported by their underlying value.
Well, that didn’t take too long:
Tulip mania lasted something like 3 years. The NFT market was only about 3 months. But as they say, nothing of value was lost.
So it seems like sometimes, if it looks like a hype-driven market bubble, and quacks like one, it just might actually be one. Thanks for posting this.
But didn’t you hear? NFTs are yesterday’s news, the next big thing is social tokens!
God! I read that whole thing … okay I started skimming the various descriptions of “social tokens”. It’s amazing how people can write “This new type of pyramid scam is taking off because of all of use pyramid scam investors and our hard-ons for new pyramid scams, which surely means that this type will become relevant outside of the, admittedly very large, community of pyramidophiles”. and not understand what they just wrote because they used words like “crypto” and “tokens”.
I really don’t get this one.
From the description, these “tokens” are meant to be used to trade for services (and maybe goods?). Sounds like they’re just re-labelling cryptocurrencies and hoping nobody notices the difference. Is that right?
I was pretty close to selling off some of my sizable Beanie Baby investment to try my hand at NFTs. Glad I didn’t!
Only some are meant to be used to trade for services or goods.
The first one is a “share” in a person. Basically people have loaned him money under a somewhat weird scheme for getting their money back and some privileges.
The second is membership in a group, as well as a token for buying things in that group.
The third is more straightforward meant to buy services, but the only service is the blog of the guy issuing them.
And I don’t think they’re worried about people seeing these as cryptocurrencies. That’s a selling point for both the issuers and the buyers.
I understand blockchain pretty well as I’m both a early adopter of cryptocurrency and a worker in a related technology field. Technically I get what a NFT is and how they are transacted. I also vaguely understand that “art” in it’s various fluid definitions have often illogical pricing, so I can grok that.
What I struggle somewhat to understand is how an NFT for a digital asset is inherently different from a copyright. If the blockchain is simply a more modern method of recording and transferring ownership of an asset and authenticating that a given copy is the original then I think the technology and it’s utility is sound. Yet I don’t at all see how this magically increases the value of a given asset which already existed. It also doesn’t seem to grant any authority to block the reproduction of said asset so it doesn’t carry the force of a copyright.
Ok, those all sound like “services” (as I tend to use the term) to me but I guess the distinction matters to somebody out there.
I guess this is the part that confuses me. There’s no functional difference then.
It’s a strategy that relies on people not understanding the underlying mechanics of these ‘tokens’ and thinking they’re somehow special because technology=magic.
Which is a winning strategy if we can learn anything from history.
Totally agreed there.
PT Barnum was overly generous when he said one was born as infrequently as every minute.
It is, optimistically speaking, a new asset class. It’s unrelated to copyright or physical ownership or anything else–it’s just an NFT. A virtual thingie that can be attached to a real digital property. Like any other thingie, it can be bought and sold and a market can develop around it. The blockchain ensures that it can’t be duplicated.
That said, the original authors can take additional actions to increase the perceived value of the NFT. The “Charlie bit my finger” video was taken down from YouTube after being sold as an NFT. The kids involved also offered to make a reenactment video.
Arguably, this other stuff just counts as “not the NFT” if you’re trying to figure out where the auction money went toward. And I don’t think it’s that common in practice. The NFT itself still represents nothing more than “I own the NFT for this digital object”.
It’s still a bit different than that.
You can, and there are a few NFTs that do this, embed the digital object in the NFT itself. It’s just a chain of bits, after all. NFTs can “be” the thing itself or be a sort of digital token of ownership of that thing. But it’s usually cheaper/easier to have it instead contain a URL or some other short bit of information that points to the digital asset rather than have the item embedded.
That still doesn’t mean you own it in any meaningful sense. Unless some separate transaction has taken place, the copyright still belongs to the author. The NFT is just a token representing those bits.
What is ownership? If I have a print of a piece of art, I don’t own copyright to the underlying art, but I still own the print. This isn’t even controversial. Can the artists make several other copies to sell? Sure, but that would decrease the value of the art. Likewise, NFTs are perceived to have value because of the perceived scarcity. A bunch of legitimate copies would work against the artist and the owners of the various works.
I don’t see how tangibility really matters at all. Theoretically, I have a bunch of money with my bank but in the form of intangible digital bits. I can translate those bits into bits of paper, but except for a vanishingly small portion of my total wealth, I don’t. I still ‘own’ that money for all practical purposes. I am not allowed to copy it (not because of copyright but for other reasons) but I am still largely free to do several things with those digital bits and am not much put out by the lack of ability to make infinite copies of it (though that would be very nice if such an ability were available and limited just to myself).
The lack of total freedom to do with that money as I please does not invalidate the concept of ownership, nor does the lack of copyright invalidate the concept of ownership of a digital thing. It touches on the inherent value of NFTs, which is a subjective question, but does not invalidate their concept, which is more objective.
And of course, this is still separate from the separate debates about the utility of NFTs in digital ownership. And whether or not NFTs have any sort of inherent value either way. But those are a bit outside the scope of GQ.