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Comment by hn_throwaway_99 | Hacker News Reader

The interesting thing to me is that many discussions around NFTs (my previous comments included) focus on whether people will treat these digital markers of provenance the same as physical markers of provenance (like a signed portrait). The thinking goes that since the physical markers of provenance obviously and provably have value (sometimes multi-hundred millions in value), the digital ones should as well.

I wish instead that there would be more discussion around how fucked up it is that provenance is a thing that has value to begin with, digital or physical. There are literally huge swaths of humanity that are nearly starving on a daily basis, yet others spend obscene amounts of money on things with 0 tangible value. Say what you want around billionaires blowing their wad on flights-of-fancy space projects, at least they are building something real that could have value to humanity. Paying for provenance is just a place to stash wealth, when extreme wealth inequality has made it difficult to find places for the wealthy to store their dough.

I don't really have any purpose with this post - human nature is what it is, and having value in displays of status is as old as the species. I still think it's horribly fucked up.

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I think people are hoping they become semantically equivalent to rai stones.

https://en.wikipedia.org/wiki/Rai_stones

These were discs of a special stone used as stores of wealth by the Yap Islanders. Over time, both because of the difficulty of moving such a large stone, and to protect it from damage, it became customary to simply keep the stones where they were and maintain an agreed upon (oral in this case) log of the history of ownership of the stone. There were even stones that sank in transit between the islands, and since everyone agrees the stone existed and no one has a way to pull it up, you can just keep the log of ownership going even with no people having physical access to the stone.

Where the comparison falls flat for me is that those stones started as a (at least for the purposes of this conversation) fairly traditional currency that large chunks of their economy depended on, before transitioning to a more abstract concept. Not that many people's retirements are tied up in beanie babies (albeit probably non zero) so there isn't that structural and heavily collective force of will to maintain value. That's what NFTs look like to me.

Fascinating! Thanks for sharing.

In defense of provenance, there's value in saying "I have contributed to this by chipping in". You can print off a digital painting on your inkjet, but paying for a signed print means you are enabling the artist to create more art, and you can justifiably take pride in that.

Of course, that's not how the world works. I wish provenance of something was not as valuable when we're talking about art made by dead people (or already reach and famous). I wish art was not used as a money store. And I feel that NFTs - and this PGP-based idea in particular - offer a possible solution to this, due to this one bug-that's-a-feature:

>Without a published chain of transactions, there is no guarantee that the artist hasn't sold the same item multiple times.

In short, the value cannot be driven up by scarcity, because there is no way to verify that. What you pay for is the record of paying someone.

We kind of have this with political donations already (public rosters of donors serve that purpose), and we have Patreon, but if I wanted someone to take pride in supporting my art with $5 - and make them able to publicly show off, which helps me too - there's no obvious way to go about it without physical tokens, or relying on 3rd parties, like Patreon, which may or may not exist in 10 years.

That's one reason vinyl and tapes are taking off like crazy. It's not just about the medium. The physical token matters.

The inherent flaw of NFTs-as-stores-of-value (and digital signatures/provenance proofs in general) may also be their saving grace.

This only counts if you’re buying it from the artist directly.

It counts a very little bit if you are buying it in public while the artist is still alive and producing, because it helps establish the value of their art in a way that they can profit from.

But that's not anywhere near as good as buying it from the artist.

Depending on the contract some nfts pay out the original creator a percentage every time it’s traded. That’s something you don’t get in most markets.

It's a thing which can be added to a real-world contract.

"Buyer agrees as an unalterable condition that:

if Buyer or Buyer's estate sells, gifts, donates, or transfers the Artifact in any way, Two Percent of the Current Market Value of the Artifact is due to the Artist or the Artist's Estate within 30 days of such sale, gift, donation, or transfer. The Current Market Value is the higher of the most recent price paid for the Artifact or an appraisal made by an independent, reasonable expert up to 1 Year prior to the sale, gift, donation or transfer."

Or the like, as adjusted for jurisdictions.

>This only counts if you’re buying it from the artist directly.

Yup, that's the point.

What value is there in a receipt that says "I paid money to the person that supported the artist"?

> What value is there in a receipt that says "I paid money to the person that supported the artist"?

Because that allows more people to support artists in the first hand. If the art was guaranteed to lose value, or keep the value but not increase in value, then fewer people would want to buy art from artists directly.

One thing I don't understand is that, afaik, and NFT and the record of transactions have no legal weight or enforceability like the assignment of copyright.

Sure it does, the NFT sales are like a bill of sale - both parties have to agree on a price before the money & item change hands. But the legal side doesn't really matter for what you'd traditionally want it for, as this public ledger literally cannot be changed by force nor the focus of an entire government attempting to do so (well, they could jail miners and people not using their fork with the forged transaction, but still).

Is an NFT different from other blockchain transactions? If I steal your wallet, am I also stealing your NFTs? If an NFT is designed to send some percentage of a sale to the person who minted it, is there a way to prevent me from selling you my wallet without going back to the blockchain?

> is there a way to prevent me from selling you my wallet without going back to the blockchain?

Besides hardware wallets, most people wouldn't take the risk of buying a wallet since the seller could then send the NFTs to a different address they control, thus leaving you with a worthless wallet you paid above market price for.

> If I steal your wallet, am I also stealing your NFTs?

(once again, besides hardware wallets) stealing a wallet itself is only possible if the owner doesn't have the private key / secret words jotted down somewhere. A much more likely and common attack after finding a private key is to immediately transfer all NFTs to another address for cheap.

So it would put you back into the realm of traditional transactions? That doesn't seem like a huge problem.

If I sell you my car, there's no way of you knowing if I gave you all the copies of my keys. I could steal the car anytime in the future.

That's the core issue though with ownership of NFTs. If a court says one thing, and the immutable ledger says something else, it's the immutable ledger that's wrong.

Which confirms my suspicions that NFTs are not enforceable because they have no laws governing them, except by everyone agreeing to the rules of the game. What I don't know, but what I suspect, is that no one is getting arrested for not following the agreed upon rules.

We can look to cryptocurrencies for precedent in how NFT ownership disputes will go. Courts have had no issue looking past meaningless technicalities about “immutable ledgers” and “key-based ownership” to adjudicate disputes about who actually owns cryptocurrencies, and have had no issue with reaching decisions that, for example, cryptocurrencies were stolen because they were transferred to a new address without the permission of the current owner.

Then perhaps it's a ledger of possession instead - a court can't alter reality and say "plaintiff is now in possession of item", however they can order the a defendant to give back stolen property.

A ledger of possession is certainly a much better model than a ledger of ownership, but it still falls a bit short because frequently when dealing with more abstract kinds of property than a literal physical object, like intangible property (intellectual property, mineral rights), immovable property (land, water sources), or property in the actual possession of a custodial third party (money in a bank account, a company in the care of the board of directors), a court order can change possession, since there's less distinction between possession and ownership of these less concrete forms of property.

So it's fair to say that a blockchain can serve as a ledger of possession of those things that are themselves on the blockchain, but not of any thing that is external to the blockchain.

Rich people spend money on useless things, provenance isn't required to pose the same question. End of the day life has no meaning and people find it in whatever they do. It's unfair that people starve while others have so much but such is the universe. The photon that gets gobbled up by a dark hole doesn't think itself more or less lucky or worthy than the photon that crosses the universe.

I disagree that life has no meaning, and helping the poor is deeply meaningful. Redirecting wealth from the rich is one way to do that.

Helping the poor is meaningful… to your life. Inherently life only has meaning that we ourselves attach to it.

If the meaning of life is to help the poor, what is the meaning of life for those that are helped? What is the meaning of life when there's no poor?

I agree helping those that need more than you is very noble and I aspire to do more of it, but it's not because it has some deeper meaning, I'm just human and have compassion.

>Rich people spend money on useless things, provenance isn't required to pose the same question.

It's not just rich people. Pretty much everyone living in a developed country from the 20th percentile up pisses away an inordinate amount of their income on stupid shit. Why? Because it's fun!

"people starve while others have so much but such is the universe"

People die of blacklung, scurvy and smallpox, they die in slavery...

Oh wait, they don't any more. Later generation will look down at our barbarism the same way we look at tribes of cannibalistic neanderthals.

> Later generation will look down at our barbarism the same way we look at tribes of cannibalistic neanderthals.

I believe this is true of any philosophy that believes itself the path to progress.

If I believed my philosophy would result in future generations looking back at us as a pinnacle of human rights and technical progress - I’d look for a different philosophy.

It’s also fair to say the path to that progress you referenced in comparison is historical record - we know the societal structures in place when we accomplished that.

Couldn't agree more. they all think that they are investing the thousands of dollars that went to the NFTs, I think if a stupid monkey drawing became extremely expensive in a little time, it will become worthless in less time.

If you pay for something that already exists, like a piece of fine art, that money doesn't disappear, it just changes hands. The buyer could have spent that money on fighting poverty, but now the seller has the money, and you could say the same thing about them. The net amount of wealth in the world is unchanged.

Buying things that need to be produced is the real problem. When you buy a new private jet, you're adding demand to an industry. That transaction re-allocates tens of thousands of man-hours to aircraft production, man-hours that could instead be going towards any other cause that has marginally more utility to the rest of society.

Provenance isn't the issue, the issue is people with money paying others to work on projects that solely benefit themselves rather than benefiting the less fortunate.

"Paying for provenance is just a place to stash wealth"

When you make a Golden Toiler, you don't give a fuck about stashing wealth. You do because you can. Same goes for casinos, etc.

https://www.bbc.com/news/uk-england-oxfordshire-58529069

Humans are by nature self-serving. For example, it's easy to to point at blockchain as a burden on our environment, but of the people that do so - how many will needlessly consume meat on a regular basis, or by single servings of items in plastic wrapping? It's all just cognitive dissonance.

"or by single servings of items in plastic wrapping?"

Bought a smartphone for $200? You are supporting modern slavery in China with your consumerist demand for cheap goods!

Oh, you bought a premium smartphone for $2,000? Congratulations, you are still supporting slavery, the company lied, have a nice day!

Stop this charade, it's only purpose is to shift blame while those that created the problem are making a killing.

There is nowhere I can buy food without plastic within a 5 mile radius. What am I suppose to do, buy a cow, slaughter it myself in my apartment?

Well if you care enough in the first place, you won't be eating beef at all.

Replace beef for cucumber, now what? It still comes in plastic.

Whats's the point of this criticism that does not address the substance of my post whatsoever?

What's next on this train of thought, 'if you cared about the environment you would commit seppuku and save the world your carbon footprint'

My point is that the beef farming industry makes bitcoin's carbon footprint look like a drop in the bucket in comparison, so it's disingenuous for folks to shit on crypto because of it's environmental impact if they are going to be hypocrites and put a burden on the planet in every other way imaginable.

The logical conclusion of this is that not existing is the best for the environment.

We can do something, but it is ok if it is not the absolute best. The absolute best for the environment might not be too healthy for you :)

Humans crave status.

Owning scarce items gives them status.

Ergo, money is spent to secure these items to signal the owners status.

> Owning scarce items gives them status.

NFTs are not scarce. A painting is scarce because you can never replicate the original painter physically impressing whatever they see in their mind on a blank virgin canvas. If the original painter happens to be on the right side of the Power law and becomes famous, then the painting value also skyrockets because said canvas was touched by them (e.g. Leonardo da Vinci)

Stuff on the internet cannot be scarce, you'd need the metaverse with its own rules to create scarcity. E.g. "Ferraris" and "Lamborghini" cars in GTA V. Their rarity is enforced but as soon as the internet gets hold of it then the scarcity is immediately eliminated on the PC version with mods

> NFTs are not scarce.

This is why provenance matters. The NFT with the same provenance is scarce. When an artist mints an NFT and sells it, the NFT provenance is part of the value.

If I mint an NFT pointing to a frame in Pulp Fiction, no one cares. If Quentin Tarantino mints one, now it has value.

Except of course, that [i] the provenance of Quentin Tarantino himself minting it (and not also offering his blessing to other NFTs associated with that frame) is entirely trust-based and off-blockchain and [ii] its hard for anyone to argue with a straight face that some cash in digital certificate made by some programmer three decades after the film is the "original" in the same way that, say, a square of canvas that some famous artist actually applied paint to, or at least a garment Travolta actually wore. So whilst the provenance exists, it's more autograph level than original artwork level, and not necessarily a step above a scrawl on a bit of paper in terms of trust and uniqueness.

> When an artist mints an NFT and sells it, the NFT provenance is part of the value.

Except when I buy a painting I can lend it to a museum and get a steady income, with NFTs you are only hoping that some bigger fool will buy your jpg, because everybody sees what you see, and a jpg is not a painting, you don't have to stand in front of it to appreciate it.

An example was the recent sale of the original picture from National Geographic 1983 issue. The "Afghan girl" is one of the most famous pics of 20th century if not the most famous.

The "original" sold for a mere 63k, that's because it doesn't give you anything more than the pic which was on the cover of NG or you have seen countless times on the internet since. Compare it to famous paintings or even a Banksy and it's a very small sum of money.

Most famous jpg sells for less than 1/10 of a mediocre painting

Also most importantly once you have taken the painting from the artist hands you are in power. With NFTs the artist needing money can and will mint the exact same JPG undercutting all the fools who bought the previous NFT.

He will get the money and the praise (ohh distributing his work to everybody instead of select few how cool is him!!!) and you'd get a huge financial loss.

> With NFTs the artist needing money can and will mint the exact same JPG undercutting all the fools who bought the previous NFT.

People will still be able to ascribe meaning to which NFT was minted when. So an earlier minted NFT may be more valuable to some than those that were minted later.

Just like when Banksy “destroyed” that piece by shredding it half way, the “destruction” actually worked to increase the value of the piece. In the same way, conceivably, a first batch of NFTs that supposedly should lose value after the artist starts minting a bunch more, could turn out to instead increase in value, because of their history of having been minted and sold before the event of the artist minting a bunch more.

> So an earlier minted NFT may be more valuable to some than those that were minted later

Are dollars printed during the 2008 recession more valuable than those printed during the 2020 recession?

> In the same way, conceivably, a first batch of NFTs that supposedly should lose value after the artist starts minting a bunch more, could turn out to instead increase in value, because of their history of having been minted and sold before the event of the artist minting a bunch more.

But why? It's the same JPG.

> Are dollars printed during the 2008 recession more valuable than those printed during the 2020 recession?

No because dollars are not used the way that NFTs are.

> But why? It's the same JPG.

But it's not the same NFT.

Is a Brad Pitt autograph from 1999 worth more than his autograph in 2020?

We are really latching onto the pipe smoke here.

Wyndam-Matson giggled. "That's my point! I'd have to prove it to you with some sort of document. A paper of authenticity. And so it's all a fake, a mass delusion. The paper proves its worth, not the object itself!"

It's not as bad as some other options -- eg extravagant consumption with huge carbon footprint or digging shiney metals & stones out of the ground.

The fuckedupness is connected to the vast popularity of authoritarianism over empiricism.

For 99% of the population, what you see is less substantial than what authority asserts. (authoritative individuals, the authority of consensus, mob-style-debate, the authority of the hivemind...)

Yes, it's fucked up. Anti-scientific. Psychotic even.

The money they pay also has 0 tangible value. You can't pay humanity out of poverty, that's a ficticious dream. Poverty is a structural problem, and a political one. It has more to do with what other countries are allowed and not allowed to do within the larger financial superstructure dominated by western capital.

> The money they pay also has 0 tangible value

Inflation may be a bitch, but last I checked I could walk into McDonald's with a green piece of paper with a "$5" printed on it and walk out with a Big Mac, no questions asked.

It doesn't scale, is the thing. You can't walk into a macdonalds and walk out with a billion burgers just because you're a billionaire. What seems to make sense on a micro level is completely nonsensical on a macro level. Money is mostly tied up in property, stock, loans and financial derivatives anyway. It's largely a ficticious element, which is printed by the billions every day.

Of course it scales. Sure, he'd probably need to call ahead (like, way ahead), but if a billionaire wanted to buy a billion burgers, it's not like that's an impossibility.

Are you sure? At that scale there are so many second order and third order effects that scaling production is likely very nontrivial

> It doesn't scale, is the thing. You can't walk into a macdonalds and walk out with a billion burgers just because you're a billionaire.

That's only because the super rich are dictating what's in demand. If you take all the money being spent on luxury watches and start spending it on dental care for children, the market should reduce the supply of watch makers and increase the supply of dentists in order to meet the demand for each.

Most money is invested in assets designed to retain wealth or increase profits, directly or indirectly. Their wealth and power is contingent upon that very scheme.

I’m sure Mac Donald’s would happily make a few billion burgers for the right price

I first read your example as a snarky one, but on reading it again its implications are rather profound.

I wonder how much of our problems arise because our intuitions and assumptions on the small scale simply fail on the macro scale

That's what "fiat currency" means. The green piece of paper is useless in a vacuum (maybe unless you're a fan of tiny origami or in search of kindling), but because everyone just agrees (and the US government enforces) that a particular kind of green paper with a "$5" printed on it has a certain value, then it can be used as a medium of exchange.

The burger did not come into existence because of the existence of the 5 dollar bill. If it were, you could print out burgers for cheap!

That's firm empirical grounding right there. A steel bridge joining illusion with materiality

you can't pay humanity out of poverty, but you can help humans out of poverty. don't look at it as a global problem, it's an individual problem. so the thousands of dollars that went to stupid monkeys, if you take just 1% and give it to someone that values it is much much better

> The money they pay also has 0 tangible value.

That money absolutely has tangible value. If Jeff Bezos is willing to pay $500 million for a yacht, but I'm willing to pay $600 million to build schools, the market should favor building the schools and society ends up with a bunch of schools rather than a single super yacht.

That's why we need some kind of significant wealth tax. Take the money away from people that will choose to allocate resources to yacht building and other frivolous things and spend it on stuff that has an obvious benefit to society.

What I don't understand is the focus on media NFTs. On both sides.

To me, it's obvious that owning an image or a song doesn't give you any advantage over just "right clicking" it.

I can look at it, the owner can look at it, that's basically what you can do with most media.

But there is so much more that can be done with NFTs. For some thing, ownership actually gives you an advantage.

I own my drivers licence and my bachelor degree. Other people can look at them too, like I can, but looking at them is not the actual value of them.

My opinion, NFT is mostly a scam for the next round of investors. How long it will last, I have no idea. But it’s not sustainable.

Just my opinion, feel feel to roast me.

No roast, I think most of that stuff is crap.

But, I also think, the rest that is left when the bubble pops could be an improvement over the status quo.

Most people peddling it, including all the influencers and celebrities, are only in it as a get-rich-quick scheme with the small possibility of it gaining in value over time and paying dividends to the original artist every time the art is traded. But it's not bad technology, it works well for what it says - tracking a specific bitstream's history of sale so other technology can leverage said history to verify ownership.

What advantage do you get from NFTs?

In Russia, you own bachelors degree. In Soviet America, bachelors degree loans own you.

A bachelor degree loaning me out seems like some sort of hyper capitalist dystopia.

Nothing capitalistic about student loans.

Remove government loan guarantees and cost of college will drop drastically.

There's a bit of that in The Unincorporated Man (which at times reads more like an economics paper with a plot than sci-fi).

At birth, you're incorporated. Instead of getting taxed, the state gets some portion of your shares as do your parents and you. The majority shareholders can make some important decisions. Additionally, if you want to go to college, you sell some shares of you that you own to the college.

That the book won the 2010 Prometheus Award from the Libertarian Futurist Society and a review of it is titled Anti-Corporate Libertarian Futurism in "The Unincorporated Man" ( https://gizmodo.com/anti-corporate-libertarian-futurism-in-t... )

> But there is so much more that can be done with NFTs. For some thing, ownership actually gives you an advantage.

I have an unwritten blog post about what "ownership" means in the digital realm, but the gist is that ownership is control. This is complicated by laws imposing meatspace-minded artificial scarcity, mainly by forbidding the duplication and/or reverse-engineering of certain bytes on your own hard drive (programs which have restrictive licenses).

So NFTs have nothing at all to do with ownership because they don't touch those dynamics (at least not in a way meaningful to the end user). Even an NFT that granted you certain privileges would have those privileges enforced by some external system, so you're again only borrowing the authority from someone else so it's really they who own it and you're only buying a license to use it.

Open source software, on the other hand, is about ownership because the license is granted to users to assume full control of what they possess with no third-party arbitration.

Sometimes the entity you "own" is just digitally signed content.

You can certainly make a perfect copy from it, because it's a digital good, but the copy gives you nothing.

> But there is so much more that can be done with NFTs. For some thing, ownership actually gives you an advantage.

You mean like this? https://stampery.com/

You can't sell the advantages that your degree or license confer to anyone else.

There's no reason for those to be an NFT.

While I understand, that this is what the majority of NFT proponents find most valuable, I don't think being able to sell them is a requirement.

Then you gain approximately nothing over the DMV maintaining a database of licenses, like they do now.

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