Whether the data representation is a piece of cardboard or a JSON string replicated on 10,000 Ethereum nodes or a tulip or a Venmo balance is arbitrary; it just matters whether a lot of humans are looking at the same thing. And for the time being, a lot of humans are looking at crypto ledgers!
Oh but surely it does.
Cardboard is fragile, and degrades if not looked after. Over time, the average condition of cardboard cards will deteriorate. So, if you own a baseball card in good condition, and can look after it better than the average, over time you will end up with one of an increasingly rare class of pieces of cardboard - an old baseball card that is in good condition.
It’s not hard to imagine that in the distant future there will still be people who place value on the history of baseball who are interested in owning, for example, a collection of mint original baseball cards dating to the original era of each player, for every hall of famer who ever played for the Giants.
So the speculative value of any baseball card includes some expected value estimate based on the possibility that it might, someday, be the last of its kind, and some millionaire needs to buy it to complete a collection.
Can you really tell a similar story to yourself for why the expected future value of any NFT isn’t zero?
NFTs posit that the answer is that yours isn’t authentic and the process won’t devalue mine because mine is. And they offer an algorithmic mechanism to enforce and verify authenticity.
In the baseball card world, that ought to be true, but may not be. Maybe my fake is sufficiently good to fool the market.
Then at that point we realize that what is really valuable is that authenticity. We can make cards themselves infinitely cheap to copy flawlessly and the proof of authenticity remains distinct and valuable.
The fact that digital copies can be perfect, and never age or deteriorate due to the inevitable march of entropy, is a fundamental difference and yes that affects how valuable 'owning' a digital artifact is versus owning a physical one.
But you've hit on exact problem the blockchain solved from day 1, you can copy the image (just like you can download hi resolution scans of baseball cards) but the underlying "cardboard" cannot be copied, or copies can be detected with 100% accuracy (depending on how you look at it).
And in fact, the photo reproduction on that card was already a poor 1980s print quality reproduction of an original photo of Barry Bonds, which probably - no matter how well it was looked after - will have suffered and faded with age as print tends to; and that actual original photo was probably reproduced in a bunch of other places outside of that run of baseball cards - and maybe the original negative of that film exists in some archive somewhere, with a high quality digital copy available - from which you could reproduce an even higher quality picture than was presented on that card.
But you would never be able to replace that card, because the point of the card was its physical connection to the moment in time where a legendary career started.
"Humans preserved this specific lump of matter and kept it safe over a long period of time even though that was difficult and, let's be honest, not very important" is what gives value to antique collectibles.
"Humans preserved the cryptographic chain of custody of this sequence of binary digits that reference a specific widely archived piece of digital media over a long period of time, by creating a distributed computing system that just automatically ensured it would be passed on to posterity whether posterity wanted it or not," doesn't create the same human connection.
But on short time scales all age is similar and authenticity seems to be sufficient to at least toss a bunch of liquidity from place to place.
1. Is it irrational to pay large sums of money to collect NFTs? Yes. 2. Is it irrational to pay large sums of money to collect physical cards? Also yes.
Regardless, we humans are weird and will do it anyway.
Beyond that though, keys get lost so NFTs do have a mechanism of leaving circulation.
But are they really? I mean, are there that many humans waiting in line to have a JSON pointing to a tweet?
There were a few reports of NFTs going on the market for thousands of dollars, but at least the ones I'm aware of sounded an awful lot like people buying their own NFTs and leaving that out from the report.
I fail to see the relevance of your personal preferences to the discussion, as my point was that the cases I'm aware of sound an awful lot like shills trying to inflate the value of something with no market value whatsoever.
As a concrete example, there was a HN discussion a couple of months ago on how a kid reported a couple thousands of dollars worth of sales from NFTs, but it all sounded like a mix of straight up fraud and money laundering. A few comments in the discussion point out that the kid's father works in finance and it sounds he is trying to case in on the NFT trend.
This is just your belief in what people would want to do, and is irrelevant to whether people out there exist, and I am claiming (seemingly successfully, as my comment is resonating with a number of people) the same thing would probably be said with just as much confusion by anyone who really considers how utterly pointless a baseball card is.
And that's only one of the more notable nft projects.
https://www.larvalabs.com/cryptopunks lowest price available $386k(!)
or more detail on artblocks: https://www.nft-stats.com/collection/art-blocks average price $39k
or these: https://www.nft-stats.com/collection/boredapeyachtclub 90th percentile = $168k
There are a lot of humans waiting in line for other digital assets that don't do anything, like Fortite skins. That's also just a row in some database, what's the difference?
That is definitely part of it. We are physical beings, you can't pretend like physical existence is irrelevant.
No, but if something physically exists then it's possible for there to be originals and first printings, which can be finite in supply despite the ease of reproduction.
I can understand why some people might prize a 1987 Barry Bonds card over a modern reproduction, even if the reproduction is indistinguishable, because the 1987 version is older or more authentic.
But there is no 'original' of this comment - moving it from my computer to yours (and from your RAM to your screen and so on) inherently makes it a reproduction. There's no authentic-vs-inauthentic distinction to be drawn.
Yes, the value of the Baseball Card is derived from the fact that it actually exists.
The fact that someone is arguing that 'The Baseball Card' is not materially different from 'a number' is really an interesting cultural phenom.
Bitcoin is not a currency, and it's not used for anything, so it's a really just a number, that someone may speculatively want to pay money for, due to the fact a small number of other people will pay for it, but unless there's a more broad acceptance of it, the implied value will also fade.
If NFT's implied ownership of the Baseball card itself, I think this would be another thing altogether.
Is that so? I just tipped bitcoin to a twitter account I enjoy (using lightning network). Keep lying to yourself..