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Comment by mattdesl | Hacker News Reader

I would point to Hicetnunc as one example[1], which provides real value for many artists on the platform.

I’m sure it’s possible to build a similar platform with a central database handling transactions and Stripe payouts, but I’m not sure it would be met with the same enthusiasm (and, despite the possibility of this with past tech, no pre-blockchain digital art marketplace has come close to meeting it in sales).

Due to the decentralization of the art tokens (via the blockchain), the community has been able to grow and evolve in a way that a centralized platform could not. For example: while the site’s contract was paused to repair a bug, artists continued to trade tokens directly peer-to-peer (no platform needed), and even build new sites and platforms that enabled trading & auctioning on the same Hicetnunc-minted tokens.

[1] https://restofworld.org/2021/inside-brazils-diy-nft-art-mark...

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So I would agree that this marketplace is creating profit for artists. Whether there is real value creation happening I would consider debatable. NFT's themselves are a highly speculative asset, and I would not count on this marketplace continuing to grow and thrive a decade from now.

In other words, a lot of people probably made a very good profit operating tulip markets in Holland in the 1600's, but that doesn't mean they were creating value.

That’s an interesting argument. What defines “value” in your mind? The platform brings value to artists (financial freedom to create more art), value to collectors (digital ownership over a scarce conceptual artwork), and value to the art world (more digital art being created by a more diverse group of people).

Not all may agree with these values, and perhaps this platform and it’s tokens will not persist after some years, but I’m not sure that means the project does not currently provide value to those participating in it.

Because “NFTs are dead” (according to the media) we have hopefully past the moment of tulip mania. But perhaps it will really take some more months or years for this to truly “die” — during which time the artists have a viable marketplace to distribute their art and earn revenue on it, where no prior option existed for them. Or, perhaps it will not die so quickly, if enough people continue to see value in collecting and supporting digital artists in this way. Time will tell.

Value is a tricky thing to define, but I would probably define value in terms of utility: you are able to create value for someone if you allow them to solve a problem or gain satisfaction, using less resources than they otherwise could.

The sticking point for me with your proposed value proposition is here:

> value to collectors (digital ownership over a scarce conceptual artwork)

My question would be: is it really digital ownership that collectors are interested in? Or is it the chance for future profit on the assumption that these NFTs may increase in value.

I suspect in most cases it is the latter, and in this case we don't have value creation, we have speculation. Essentially it's just a bet with a very significant downside risk. Speculation, especially in an atmosphere of irrational exuberance, is much more likely to result in the destruction of value than the creation of it.

I think you may be viewing this through the lens of high priced NFTs that are in the millions, and are mostly speculative assets for a crypto trader’s portfolio.

When I buy a digital art token worth 1 XTZ (around 2-3 USD), it is closer to skipping my morning coffee for the chance to support an artist’s latest work, perhaps from an artist that I have been following for years on Twitter or Instagram without giving them any support besides Likes and Retweets (“exposure”). I have no intention of flipping or speculating on the art — but of course if there is demand for that token I may consider trading it, as it would give me even more XTZ funds to continue supporting other artists in this way.

I have not yet re-sold any Tezos NFTs, and I have bought hundreds from many different artists and illustrators. If none of these ever sell, I won’t feel like I have lost anything, because the value I see in this is not in the speculative nature of the asset.

And to your question: yes, many collectors appreciate the digital ownership aspect, and enjoy building out carefully curated galleries and showcases of their owned tokens, much like many traditional art collectors take pride in owning and displaying their collection.

What value does crypto bring to you that a artist running a shopify store does not? It sounds like the NFT is entirely irrelevant in this transaction other than possibly providing a socially acceptable route that is better than a PayPal donate button.

I am an artist running a Shopify store (prints), and also have been selling via NFTs on Tezos and Ethereum for the last few months. If NFT continues to be profitable in the long term (even a fraction of what it is currently), there will be no need for me to continue using Shopify.

Consider the fees alone: I pay monthly fees for Shopify, for art printing and shipping, pens and physical materials, hosting my domain name and studio email, and so on. Not to mention the cost of my time (replying to emails, customer support, editing my store's website, etc).

All of this to enable revenue on my primarily digital art. I do enjoy making physical art prints, but I mostly work with software and code, and the art I make is better experienced digitally. Before NFTs, there was no established mechanism to earn revenue on digital art (primarily because there was no established mechanism to 'own' digital art), so I was forced to adopt physical printing and e-commerce despite it's high costs, annoyances, and generally poor return on investment.

In contrast, I can mint an art token on Hicetnunc for less than 25c USD. These fees do not go to a central platform like Shopify, but to the blockchain that helps maintain the provenance and permanence of the tokens I am distributing.

There are many other benefits of blockchain in this digital art space, I have written about it extensively[1].

[1] - https://mattdesl.substack.com/p/subscapes-part-1-preface

> and the art I make is better experienced digitally.

That's where it breaks down when buying stuff for me personally. Prints admittedly run into the issue of "walls get full", but I have not figured out a way to regularly enjoy digital art, especially since everything comes in different sizes and scales. Plenty artists I follow (you included ;)) now are on HEN, but that has kept me from getting into any of it, even though I get the limitations of prints.

There have been combinations of screen + digital art "subscription" in the past, which I never liked because of their closed nature, but maybe some amount of standardization/embedded display hints/... towards a more open variant of that will develop.

Sorry I meant specifically, you could just sell digital copies of your artwork on shopify, along with a little pdf from you saying "Mattdesl hereby certifies this artwork as edition N of M". What value is the NFT providing? As far as I can tell the only value is that people are willing to trade in NFTs but are less willing ot accept the shopify solution. But they're both equal measures of ownership. Once you've minted your NFT on Hicetnunc you still have to sell it, and that's likely to go via a crypto exchange in exactly the same way that your credit card transaction goes via shopify?

I answered in other threads here, e.g.

https://news.ycombinator.com/item?id=27770605

Largely this question comes back to decentralization, trust, and a novel paradigm of digital ownership that is enabled by elliptic curve cryptography and blockchain tech.

The blockchain acts as a social consensus mechanism - we can all agree that "X public key owns Y unique token" - which is not the case with a centralized database record that can be mutated, or a file that can be easily copied/edited and shared.

> I’m sure it’s possible to build a similar platform with a central database handling transactions and Stripe payouts, but I’m not sure it would be met with the same enthusiasm (and, despite the possibility of this with past tech, no pre-blockchain digital art marketplace has come close to meeting it in sales).

So blockchain itself is completely useless here, and all the value lies in the hype. And once the hype goes away, there's nothing underwriting the value of the system.

Similar but not equal.

Part of the enthusiasm around these platforms is in the idea of decentralization of art assets (which cannot be achieved with a central database). See the latter part of the post you replied to.

How decentralized is it truly when it's all depending on the Hicetnunc brand? If you had Hicetnunc-branded certificates of authenticity, you'd have the same "decentralized" trade opportunities, and in both cases the only value these trades have derive from the branding attached to them.

The premise of this space is that the tokens hold value because of who distributed the tokens (the artist), and what they conceptually represent (the artwork), and this value can exist beyond the scope of the website or platform that originally facilitated their distribution.

For example, some artists on Ethereum are deploying their own token contracts[1], without the need for a distribution platform like Hicetnunc, SuperRare, etc. Once minted, these tokens can be traded on a secondary marketplace such as OpenSea (which may not have taken part in the initial distribution). If those secondary markets fail, the source of truth still lies in the blockchain, and the tokens can still be traded via any new marketplaces that emerge, or via smart contract queries through blockchain explorers like Etherscan, or even via one's own command-line (the web merely acts as a thin interface over these distributed endpoints).

I do agree that artists on Tezos are becoming too centralized to Hicetnunc (compared to, say, NFTs on Ethereum, which tend to be very diverse), but I believe this to be a solvable problem[2].

[1] - https://www.deafbeef.com/

[2] - https://twitter.com/mattdesl/status/1412713480893960195

> The premise of this space is that the tokens hold value because of who distributed the tokens (the artist), and what they conceptually represent (the artwork), and this value can exist beyond the scope of the website or platform that originally facilitated their distribution.

So what value does a distributed, anonymized ledger add, when the artists are the central authority who determine what is and isn't authentic? In the end, the value comes from the artist saying "I made this, not an impostor", which is the same as any physical artwork in history.

Do people just want to own art without being burdened by the ownership of physical goods? That sounds rather irrational even compared to normal art trades.

The distributed ledger adds security, longevity, ownership, and provenance: eg. a token is purchased from an artist, and it can be held and traded (ie. "owned") for as many years as the blockchain continues to survive. Unlike the ownership of a file or record in a centralized database, which are mutable and based on a single source of trust, the blockchain acts as a social consensus mechanism, i.e. we can all agree that "wallet X owns digital token Y".

To your second point: much of today's art is not manifested by a single physical artefact. Conceptual art has been around for a long time; ownership of conceptual art is not new[1], but the advent of blockchain gives a new vehicle and distribution mechanism for it, in particular digital and software art.

[1] - https://www.artsy.net/article/artsy-editorial-conceptual-art...

> The distributed ledger adds security, longevity, ownership, and provenance: eg. a token is purchased from an artist, and it can be held and traded (ie. "owned") for as many years as the blockchain continues to survive. Unlike the ownership of a file or record in a centralized database, which are mutable and based on a single source of trust, the blockchain acts as a social consensus mechanism, i.e. we can all agree that "wallet X owns digital token Y."

Is there any advantage over a traditional certificate signed by PKI? I'd say the risk of X.509 PKI in its entirety disappearing is significantly lower than the risk of any individual blockchain startup failing. (How's that for decentralised redundancy!)

> To your second point: much of today's art is not manifested by a single physical artefact. Conceptual art has been around for a long time; ownership of conceptual art is not new[1] but the advent of blockchain gives a new vehicle and distribution mechanism for it, in particular digital and software art.

So we're back to hype for the sake of hype, detached from any technical merit.

I don't know much about PKI but it seems to rely on certification authorities (i.e. single source of trust) and there does not seem to be a clear mechanism for artists to sign, trade, and 'own' them.

But, if you were to create a PKI-enabled digital art marketplace that is able to meet the same decentralized structure and benefits of NFT technology, without the need for a distributed ledger and tokenization, I'm sure many artists and creators would welcome that.

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