It is difficult for the average person to conceive of how useless NFTs are
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Here's a thing about NFTs that I've seen a lot crypto evangelists and haters miss, and a sentiment that I think will grow once the novelty dies out: The "art" is irrelevant. It's no more than a thumbnail or a poster marketing it's utility, and that's exactly the actual important part - what I can do with it. Can I use it as an in-game item? Do I get access to your next podcast episode early in a patreon-like service? Do I unlock your next online course for free or get a 50% discount on your next concert?
This sense of multiple applications is what I think people may or may not mean when they use the term "creator economy", but I think it fits nicely. People argue that interoperability of assets is useless because "no two games would ever want to share an item, developers don't want that". But another angle to this is that creators can give utility to a single asset across a wide variety of applications for their fans.
Regardless, none of this has been realised yet and maybe this is just a pipe dream if the majority of hype in the space continues to revolve around useless, ugly ass monkeys that are shown off on twitter for some ego-inflating sense of elitism. It could go either way I guess
Exactly. A few original JPEG NFTs will survive, but 90% of the late comers and copycats will fail.
> There is literally no point in making an NFT without utility now, unless the minter is someone popular
Precisely. That ship has sailed and this is why you see a popularity of copycat NFTs JPEGs upon copycat JPEGs since that they know it is a scam. They are taking advantage of the market before it collapses just like the wild west of ICO scams in 2017. Now the SEC has put a stop to that and has regulated them as securities, [0] making unregistered ICOs as illegal. Similar regulations may happen to NFTs.
The only form of NFT that seems to have some value, valid use-cases and utility is a blockchain domain name which is likely to surpass the nonsense of useless NFT JPEGs.
There are some projects working on reducing this though, for example zkSync is doing some really interesting work on a layer2 solution that feels like you're staying on the Ethereum mainnet but the fees are highly reduced thanks to the zkRollup algorithm.
I saw my friend mint an NFT for $1.40 the other day just to showcase the work zkSync has been doing, at this cost it'd be super interesting for real world uses beyond just art provenance.
2. There already exist NFTs that take a x% cut and give it to the creator.
Literally every major game company has created their own marketplace despite Steam existing. So yes: they really do want to create their own marketplaces. If NFT's somehow gain traction in mainstream games, they aren't going to allow things from some random public blockchain, they will force users onto their own. You're delusional if you think they're going to forego that revenue stream because of the one-time investment of creating a market. That's not even a rounding error in their budgets.
Similarly self custody isn't great for all users. It's great that a company can get you back your items if you get hacked.
I just gave some pros and not any cons in my previous post.
I never said that, nor did anyone bring up something like that. Your game system only needs to handle your own items. It's on the developers of wallets and NFT marketplaces (aka not you) on supporting all different kinds of NFTs.
A decade on from The Silk Road and this is where we continue to be with crypto.
Now what if I'd like to sell access to that genius on a marketplace, locked behind an NFT, bid on, tracked and tied to a leaderboard etc. Now let's say I have generated Token X with the value of "TSLA Feb. 29 2022", inside of which lies the closing price of Tesla on that date, with the value being tied to my previous performance on similar picks...
As an example, I have the Twilight Princess Link Amiibo. In most games it gives some reward related to The Legend of Zelda in general. When I scanned it in "Yoshi's Woolly World" for the Wii U it unlocked a Yoshi looking like Link, as would any Zelda themed Amiibo. When I scanned it in The Legend of Zelda: Breath of the Wild for the Switch it instead unlocked Epona, Link's horse featured in many games, including Twilight Princess. Which can only be unlocked by that specific Amiibo and no other Zelda ones.
Of course, these tags are not unique and can quite easily be cloned.
* Nintendo chooses what amiibos are made. Centralized.
* There are many copies of a small number of amiibo types. Fungible.
* You get a physical thing. Not a token
* Only nintendo games may use amiibos
* The data on the amiibo is uniquely interpreted for each game. It's not a generic interface. Not all amiibos will do anything to every game.
Amiibo, and pokemon (trading the pokemon) are great examples of how to trade and scale information exchanges in the real world without needing an NFT blockchain. Blockchains are terrible ideas for games.
The point I was getting at was that udbhavs' comment on "no two games would ever want to share an item" reminded me of a case where several games do share some item, though in this case not a unique one. Any item shared between games would always have to be interpreted by each game unless they're based on some shared engine feature or module for interpreting them.
This use case isn't an appealing use case FWIW - it is a use case though. Already seen coffee with NFTs being sold (mind you its marketing BS trying to signal its modernity, no function).
The funny thing about NFTs and gaming that I find is that if you listen to VCs and other people talk about the future of gaming. They say things like people won't play games unless their getting paid (i.e. NFT like reward system).
Personally I find that disturbing that the only reason people would play video games is for work/make money (dystopian). The original concept behind video games was for sheer enjoyment .. Not trying to make this a rant but the twitch monetization of gaming really changes the incentive structure and NFTs would further cement that poorly aligned structure in that video games are considered "work".
I agree that is BS. I tried out a few "Play2Earn" dApps and they are in no way a replacement for modern video games. Some of them weren't even dApps, like one game running on a discord bot where you basically had to spam commands to earn tokens that you could withdraw. Guess what happened? Discord banned the bot for gambling features and the token tanked. The server is back up somehow with some features stripped out and I'm amazed people are running back to it after countless red flags.
Nobody is in it for the enjoyment because there is no "game", it's just people looking to make a quick buck. The P2E games which are "single player" necessarily have to function as a Ponzi to keep new players coming. If you try to run the game logic on chain, you will be severely limited in terms of scope which means that PvP games will need a centralized server to run the game itself in which case there's no reason not to cheat the hell out of it.
There is a huge market for content creators having large fan bases that literally pay them money via subscriptions, merch, etc. while they broadcast their gaming sessions live online. The entire business model for Epic's Fortnite is all cosmetic items via season passes, in-game transactions, etc. The game is free to play.
If content creators were to issue NFT's that represented a cosmetic item badge/emblem, which could be bought/sold/traded on an independent marketplace and each game studio was pressured to allow these emblems/badges across games then the content creator would profit on transactions and possibly the game studios could profit - maybe they get a cut via smart contracts if that's possible.
It wasn't very long ago that cross-platform play was not allowed by Sony and Microsoft and the game studios and players pushed for it. Major games have cross-platform play now, its expected in multi-player console games. Cross-game cosmetic items could be a huge thing for studios, indie content creators and and an opportunity for always online game platforms to get income from marketing/advertising. When there's a new comic book hero movie coming out, the movie studio could release cross-game cosmetic items (i.e. look like spidey) that players could then sell/trade later on. I would agree you don't need the tech from crypto or NFT's to accomplish this but it sounds like that tech has the features needed.
NFTs only solve one part of the problem though - rights management. You still need a good way for a cosmetic designed for game X to work in game Y. That's similar to any multi-platform development challenge. There are many other economic decisions that will have to be experimented with, including tax collection, platform fees, creator fees on resale, etc. It needs to work for everyone or it won't get the reach it needs to really empower users.
Whether or not NFT actually add anything here comes down to the remaining technical challenge of interoperability. Is it common for parties to agree on a common asset definition but not a common rights management platform? That's the situation where NFT help.
edit: To clarify, I'm not talking about regular NFTs as currently added by game developers where they're basically just a ticket to an ID referencing something created by the game developers and hosted on the game servers. I'm talking about trying to create a system for NFTs shared between games from different developers.
(only thing I could think of)
I don't know why people are so obsessed with this idea of in game items as NFTs. It's a terrible idea.
Games have no reason to be decentralized. All of the information can be stored on the company's servers, like an MMO, or if it's not critical to maintain scarcity, locally on devices without the whole network, like pokemon (the pokemon themselves, which can be traded and such).
You can't reasonably expect games from other companies to implement the same NFT scheme. That's just not how games work. A longsword in dnd is not a longsword in final fantasy, nor is it a longsword in dark souls, nor is it a longsword in minecraft. And even if it were, why the fuck would you want scarcity on longswords? 99% of all items in any game are typically very easy to obtain, with a few rare things standing out, and with a natural progression built in. What would it even mean to bring your 50 hour investment in a top tier perfectly slotted jrpg omni magic blue elemental Atk+++ Spd+++ Crt+++ Mag--- weapon to a game like call of duty?
Even if we're just talking about a single game universe, like a dnd setting. Maybe there's now 3 baldurs gate games, for some reason not designed by the same company, but all willing to share the same exact item spec. Where is this concept useful, still? Can I bring my +10 longsword (a big deal) to the beginning of the game and just trivialize the singleplayer mode? Is it more of a multiplayer thing so we want real world wealth and status to be the primary driver of character strength?
You would want scarcity on longswords if your business model included selling loot crates that may contain longswords.
1. With NFTs games can take a cut of resales. With something like cs:go there was a substantial secondary resale market for things like skins, which valve wasn’t able to capture but with NFTs they could have taken say 10% of each resale.
2. Because the data is public it’s possible for other games to bootstrap off the data (we have seen this with “airdrops” in the crypto land). Meaning a game which is coming out can give some perk to people who own X in fortnite because they think their game is similar and want to entice people to try their game, especially people who they know like fortnite.
In the tech world we are always talking about how valuable data is. The blockchain makes that data public so secondary products can exist to serve needs the game doesn’t care about. And provides the ability for the original game to capture part of that market if they wish because they own the initial contract. But because the data is public, other games can also use that data how they want.
How is this a positive? Where were the people begging GameStop to write publishers a check for the used games they bought and resold?
Penny Arcade explains: https://www.penny-arcade.com/comic/2021/12/22/ubisoft
So what is EA's incentive to join the Valve blockchain where Valve gets 10% of each resale? And if there's no incentive for EA to join, why isn't it just a centralized marketplace rather than a blockchain?
> 2. Because the data is public it’s possible for other games to bootstrap off the data (we have seen this with “airdrops” in the crypto land). Meaning a game which is coming out can give some perk to people who own X in fortnite because they think their game is similar and want to entice people to try their game, especially people who they know like fortnite.
Valve and other companies already have this data, in much greater specificity than "this wallet owns a longsword".
They already can do this via the [non-nft-based] Steam marketplace where Steam itself takes a 5% fee from every transaction.
Am I missing something?
But now imagine if 10 different AAA game studios realize that they can create a market in which people instead of paying $5 for a hat or $1 for a loot box with 10% chance of finding a hat-they pay $100 for a hat NFT and $10 of that is a transaction fee to the studio. They pay $100 for it, because a) it will work across games and b) it might be worth $10k tomorrow. The studios can take a cut on each transfer, instead of just one fee! So these studios just scaled up their hat business a lot and all they had to do was agree to honor the hat ledger which says that only the hat's rightful owners can wear the hats.
There is obviously no problem moving the hats between different games (A purely cosmetic thing is pretty easy to implement).
The fact that the honoring of the NFTs is still voluntary from the studios, that it's just as centralized as ever, and that it might disappear the day the studios no longer make money from this is of course lost on the hat buyers. The tokens are extremely fungible.
Imagine you had a set of digital drawings of apes you wanted to sell. What can you charge for a nice colurful drawing of an ape? $1? Now add "NFT" to the description.
Same with a hat. The studios would do this because they see a situation in which a few of their assets become $10M ape assets and they make $100k. Before this hype dies down, the studios are afraid of missing out on it. No studio wants to be the one that missed the golden rain of NFT hats of 2023 because they didn't get on the hype train.
of course this won't be a long term thing. But we'll see land grabs like these now for a while because it's a low risk/high reward kind of thing.
You're asking the studios to give away 99% of their profit. Even in the worst case, they can all put their own platinum plated, cancer curing, blow job giving hat on the Eth blockchain and charge 10 mil for it without agreeing to share anything with anyone other than gas fees and miner bonuses. They won't. You know why? Because if they sell it in their own stores they can easily sell one thousand of them for 10 grand each and pay nothing in gas fees and miner bonuses.
They don't make something and sell for $10M because nothing studios create and market would have that kind of value. The high price of an asset is only because end users trade it among themselves (quite literally in the case of wash trades) to inflate the value. Studios can only provide the scarcity or exposure of the assets - they don't set the prices other than perhaps initially. But the key is that every time an asset changes hands, the studio gets a cut. A hat is sold for $10 then they get $1. Then it's sold 100x over, and the studio takes $1 each time. If a hat for some mysterious reason becomes the $1M monkey picture of hats, then it earns them a bigger cut in the transaction. But the key is: this is only happening because people want to take part in the lottery/hysteria of NFTs on the eth blockchain. Not because they are ready to pay $1M for a game asset. So the studio isn't "losing" 99% of anything. They just tricked people into trading NFTs which earn studios a cut, instead of other NFTs that don't.
This seems like a whole huge can of worms to open for what is to the studios a mild gain. The hat market has scaled up by 10-20x in your example, but 90% of that isn't captured by the studios. What happens when two players each have NFTs that point to different URLs where the same digital hat is? Now the game studio has to adjudicate property rights? If a bunch of game studios wanted to band together and sell more expensive for 10x or 100x the current price that could interoperate, why would they give 90% of the proceeds to the hat designer?! Designing a hat is not the hard part of this thing.
EA Games starts selling an exact copy of the GOLDEN HAT for $1. What now? It's data on a decentralized network. I start selling GOLDEN HAT WITH A DICK ON IT for $0.69. What now?
If Activision wants to sell cross game cosmetics, they should do so on their own servers. Which is totally normal frankly. It's common to get rewards for having content on other games. The blockchain adds nothing.
This is how NFTs work. If you own the $10k hat on a blockchain you own the $10k hat on that blockchain. There is nothing anyone can do about the fact that the monkey bitmaps can be copied. The ownership only applies to the ownership on a ledger, not copying or usage. Same with owning a hat on the Activision blockchain and not the EA blockchain. If they both agree to store it on the ETH ledger, then obviously there is only one copy.
To prevent copying or usage, studios would obviously need to agree (which is why this is so ridiculous - and "fungible"). In your scenario EA obviously weren't in on the scheme together with Activision. There could well be different ledgers, or studios that just use a centralized store like they always have. But those studios can't use the NFT buzzword, so they'll miss out on the sweet $$ that they can make in the 15 minutes this is a thing.
> I start selling GOLDEN HAT WITH A DICK ON IT for $0.69. What now?
Whether or not "user created" items will ever be a thing is obviously up to the studios. The studios can obviously ensure only studio-created artifacts are ever allowed, regardless of if a public ledger is used. They can't prevent a studio from making a golden hat with just one bit flipped in a 100kb artifact, which looks exactly the same. This would be even more likely if there were user-created artifacts.
But there is just nothing that can be done about that. That problem exists whether or not you use a public ledger or a private one, and whether there are multiple studios or just one.
> the blockchain adds nothing.
It adds the word "Blockchain" and "NFT" to the equation. Remember that's the difference between pictures of monkeys being worth zero and being worth millions of dollars.
But that actually solves the short term problem of “where is the infra?” and it’s not impossible that in a few spaces, this will actually survive.
Remember how everyone and their mother had to launch “cloud” services 10 years ago, and in 9 out of 10 instances it added no value. Some of those are still things despite never actually being necessary.
You seriously wrote all of that out and then admitted at the bottom that it’s only valuable because gullible people will buy it.
So you agree the whole thing is a grift. Next time just say that instead of proposing some pointlessly complex system of offloading a tiny DB onto the blockchain. “It’s valuable because you can trick gullible people into buying it.”
But yes, the reason the money is in the blockchain tech and no one pays millions for monkeys without blockchains? That’s all hype.
This tech solves a problem that could be solved by studios just making a private store they all agree on. I don’t think anyone will argue anything else, least of all me.
But here is the thing: things like currency and trade able tokens only have value because people think they do. There is a fine line between “gullible” and “currency” here.
Sorry, I missed something. What exactly can they not build without blockchains? Surely you’re not saying that the thing they can’t do without the blockchain is “use the blockchain”, because that’s vacuous.
(I’m actually not sure how they wound build this hypothetical system you described with a blockchain, though. Is there a mechanism that allows NFT transfers to accumulate “royalties” to the original seller? Or is this a hypothetical feature of a hypothetical custom blockchain that’s controlled 100% by the studio, eliminating even the distributed nature?)
> But here is the thing: things like currency and trade able tokens only have value because people think they do. There is a fine line between “gullible” and “currency” here.
I don’t entirely disagree with this, but
1) Most people investing in this stuff would have zero interest if it were actually a stable currency. They’re interested in speculation. This is in contrast with dollars (or euros or whatever) which people very commonly hoard in banks, even knowing they are actually declining in value.
2) NFTs are not intended to be currency. So even if you believe that Bitcoin or whatever cryptocurrency has long term real currency potential, NFTs are still stupid.
They can’t build tokens that people would speculate in to the point that they are worth millions unless they use a big ledger like eth where people might believe that the tokens have a lifespan longer than the games.
> Is there a mechanism that allows NFT transfers to accumulate “royalties” to the original seller?
That is my understanding yes, and this would be a premise for the whole thing.
So yes - the whole idea would be to set up a market for speculation and see a cut from each transaction.
And the chain isn’t necessary, technically, it’s a necessity to ensure the inflated speculation only.
And both studios and users have aligned interest: speculation, only. Not hats, not currency. They get shiny gear but it’s also a lottery.
It is interesting that NFT royalties are thing. I was not aware of that. Although I don’t see that this makes it valuable. Royalties are generally paid for reproduction. If you have to pay the creator to transfer the token, then it seems evident that you don’t even own the token, whatever that’s worth.
I don’t think it’s something that has or adds any value from a technical viewpoint. At least not to the point where it would warrant investment or overhead from blockchain tech. It’s hardly worth even $1 “securing” my ownership of a hat on a public ledger unless the chance of it becoming more expensive through artificial scarcity is counted as “value”.
Disney's lawyers seem to be doing just fine.
This would almost certainly result in KYC requirements, and I'm skeptical that the delta in profit is big enough to justify that lift.
The cost of KYC might not even be the biggest issue. The friction will be a non-negligible drag on sales.
There's no chance for asset reuse across games. Not only do the asset file formats differ from game engine to game engine (or platform to platform) they also differ perspectively, aesthetically, and thematically. Madden 2023 has incentive to sell NFT assets for sports jerseys. And Elder Scrolls 6, NFTs for wizard robes. But render those assets in the other game and they will look out of place. Even two games with wizards in them will have different aesthetics, mostly to differentiate in the marketplace!
One could imagine some sort of opt-in system that servers could enable that would allow for cosmetic items to travel with a player from server to server using NFTs as proof of ownership of the cosmetics.
There isn't a real reason for this to be done with NFTs vs some centralized database, but it does make more sense than the vast majority of games with are hosted on centralized systems already.
Obviously support agents make mistakes sometimes too, but that's a heck of a lot rarer than scams in MMOs.
That's like the main point...
I'd also argue that this feature is lackluster and I don't think it would have had any success at all if it wasn't for the fact that you also get a figurine.
There is an Epona Link one that instantiates Epona into breath of the wild, but it definitely doesn't do that in Mario Odyssey.
Amiibo are cool. People like them because they're cool and the in game bonuses are a fun little extra. That's very different from the idea of trading in game item NFTs with the intention of carrying over their utility to other games.
Imagine you have an NFT for, say, a gun, let's go with AK47 because of its popularity, and say it unlocks it for the current Call of Duty (whatever that is now). Why would Activision make it work with the next CoD? Is it supposed to work with Battlefield too? Is there anything stopping people at Valve from giving you a cosmetic if you validate it, if they so desire?
Still though, if you pirate you don't get the actual official figurine, there are certainly other ways to implement DRM, consumers hate DRM, and despite Nintendo's well known aggressiveness in litigating and preventing piracy, they don't seem to care about DRM on amiibos, apparently because the data is not the core value-prop.
So maybe this analogy works better than you realized.
It's true that items are unique to games. But if you want to allow some kind of trading, you will have to implement it yourself (next to programming, art, marketing, etc.). Linking this to crypto-tokens could have the benefit that you outsource the trading part. Your players "own" their items through crypto tokens, and can trade them on crypto exchanges.
You can implement it yourself in a centralised way of course. But the question is if you want to spend the resources on that.
Adding crypto assets seems way more programmer work than doing in game trading, which you would want anyway as a player.
It's a huge undertaking that would need to be custom done for each game's data it interacts with. And indie games are less likely to conform to standards than others.
They'd still need to do the work to implement every single item you are talking about. No indie would even want to do that. Nobody goes indie to work on compatibility drudge-work. Maybe if they are trying to jump on get-rich-quick financialization trend, but not if they want to actually work on their art.
That's not a terrible idea. Crossovers between games. Good gimmick.
And a lot of what you're talking about is culturally constructed, it doesn't have to be that way.
There's a couple points: low- vs high-trust, and distributed vs centralized. Blockchains have in turn two mechanisms to match: proof-of-work to handle low-trust environments, and public cryptographic ledgers to handle distributed work. In this case, games are high-trust, centralized services. There is a single controller that authoritatively owns the current game state. So this does not seem a good match for blockchain technology.
If you're not in a low-trust environment, you don't need proof-of-X. You just a public cryptographic ledger written to by a set of trusted keys. Any party can extend the blockchain by just creating and signing the next block. (Would need some contention resolution for simultaneous write attempts -- could be as simple as whoever got the lower signature hash wins.)
Yes. But apart from some specific edge cases (cryptocurrencies, specific name registries where the ledger is actually the store-of-value) how would that even work?
For an NFT to somehow be a proof-of-ownership it has to provide the owner of the token with some value. Access to some material, for example, like you mention. But where dooes NFTs come in? The provider of the service or product would need to agree to honor the NFT! And by that, magically, it's just like any gift card or rebate code!
There is a massive divide between on the one hand a tiny number of systems where the ledger is central (E.g. a cryptocurrency) because the users have already agreed that the value is stored on the ledger.
But why would a seller of hot dogs or concert tickets agree to that? And more importantly, how is it ever guaranteed? It can't be! So it's just a gift card!
What am I missing?
There are a few existing solutions to this. Movies Anywhere[0] consolidates your video purchases across 8 vendors[1]. It mostly works ok. The problem is that I still have to trust those vendors, and this industry consortia, to manage the property rights for me. I can't prove that I own a particular movie outside of that ecosystem. I want to download the movie and transcode it for personal use, and prove that I legally own the right to that movie file outside of their system. If I own a copy of the movie, I should be able to take that copy of the movie anywhere.
Music is similar. Remember a few years ago when a bunch of music services added "upload your offline library and we'll make it available on the cloud" services? That was basically using the files on your computer (ostensibly obtained by ripping a physical CD you bought at a store) as a DRM key to unlock new features within the platform. Personally, I got burned by this when Google Music got shut down and took my uploaded music with it (backups, yes). It would make a lot more sense to have a wallet of licenses that I could present to any of these services.
Finally, the BIG thing with interoperability is freedom of exchange. I want to be able to sell my digital stuff to somebody else. Or lend it to them. Or present it to a new vendor / media player / device.
MOST importantly, I want to use the media myself wherever and for whatever I want, without worrying that I'm somehow breaking the law. I want to make mashups. I want to self-host. I want to dump everything in a new hosted service and see how it works. And I want to do all that knowing that it's all above board and the creator's are compensated fairly for their work. The current system works for Disney. I'm much more interested in the artisan digital economy.
NFTs do not deliver on this vision today. Additional technology is needed. Content-addressed, distributed storage like IPFS would be helpful. We might even need opinionated regulation to get the big players on board. Just look at the difference between electronic bank transfers in Europe and the state of US electronic medical records to see what I'm talking about.
[0] https://moviesanywhere.com/welcome
[1] AppleTV/iTunes, Amazon Prime Video, Fandango/Vudu, Google Play/YouTube, Microsoft Movies & TV, Xfinity, Verizon and DirectTV
I suggest you read "How Virtual Worlds work" by Raph: https://www.playableworlds.com/news/riffs-by-raph:-how-virtu...
All 5 parts (more focused on the metaverse topic than NFT, but applicable to both) show exactly why interoperability is a pipe dream by non-game developers and has zero basis in reality. Not just because game developers don't want decentralization but because even simple stuff is hard, and even if you could solve the technical aspects you can't solve the game design aspects of it.
A while ago Ninja (top earning game streamer) mentioned he sees Fortnite becoming the Ready Player One universe, something I'd seen myself as they're by far the best positioned to do so.
For the most part assets in the Unreal store have to be modified (some slightly, some heavily) to work in another game. You don't get it for free because decisions are made for each game. You can't just download a helmet from the unreal store and it just magically sits on your character's head and works with all animations, because there's no clear idea of what a "head" is and how it should work.
There's no way a helmet from the unreal store can provide working stats for your game because health, food, armor, etc.. all vary in fine detail from one game to another.
So no, go read the link I pointed. Even what seems simple is extremely hard to do for interoperability, even if developers wanted it.
Assets in the UE store are meant to give *developers* an easy integration path, it's not designed to be a trivial integration path without development involvement.
The problems of centralized control:
The game dev can decide that your skin should not be in the game for any reason - now you have a broken link
The game dev can suddenly make 1000 more of your limited series skin - now the value has deflated
The game dev can shut down the game permanently - what is your NFT worth now?
This is combined with typical blockchain issues, like if you get scammed, or somebody hacks your account and transfers out your items, there are no backsies - no support person can help you.
its just a URL. an expensive one.
Recently cryptobros are obsessed with backporting scarcity into the "creative economy", but NFTs don't provide any primitive to do that. Its immensley amusing to see the same people who were railing against DRM in the Zune era, are now saying how brilliant NFTs are. All the while advocating for DRM but with cool glasses.
Why wouldn't a company just try to do something like steam marketplace?
Convince me that the "decentralised web" isn't just selling something and you might start to convince the average person.
Thinking of it in terms of utility vs ownership is useful because ownership is a social/regulatory concept.
The problem with utility is that that utility is still bound to the seller/market. Can I use it as a decoration in my Meta VR home if it was bought outside Meta's marketplace? Does the utility actually transfer with sale?
As such, it looks like a purchase receipt of a DRM-protected good in a single centralized ecosystem, regardless if it that receipt is represented in a third party or decentralized system.
We already do all of those things you listed just fine with databases. All NFTs would add are transaction fees and massive power wastage.
Edit: I should have added my own explanation as it's not as obvious to everyone else what an NFT is. If we continue the analogy with paper, then a NFT is a piece of paper with a unique identifier that cannot be copied. If you have that piece of paper you know that A) No one can have the same piece of paper without having that actual paper and B) no one can fool someone else they have that same paper (based on the ID). NFTs have nothing to do with URLs (although some NFTs do have URLs inside of them), the main point is to have something with a unique ID that is unique within that specific blockchain.
(To be fair, a better analogy would involve OP setting fire to a rainforest somewhere as part of the process.)
> If we continue the analogy with paper, then a NFT is a piece of paper with a unique identifier that cannot be copied. If you have that piece of paper you know that A) No one can have the same piece of paper without having that actual paper and B) no one can fool someone else they have that same paper (based on the ID).
This is where the entire argument falls apart trivially. The problem is that NFTs are just random pieces of paper containing a pointer. They're not guaranteed to be the only pointer, the content on them can be copied, they're not actually scarce resources, and everyone can (and does) fool everyone else about whether or not they have the same paper and/or the same pointer.
Additionally with NFTs, the pointer is often to some random centralized resource holder/single server in the 'centralized fiat' world of trust, and quite frequently that turns out to be a $5 VPS running apache that someone stops paying the bill for.
Notarize it, and the analogy is back on track.
The person who owns the URL on the paper can change the contents of that URL. Legally, the paper may be a gift, but I'm now the proud owner of a piece of paper.
I can similarly own a map to the Mona Lisa. Everyone in the world may even agree and attest to that fact! I don't own the Mona Lisa as a result. The Louvre can move it, take it off display, burn down, or do any number of other things.
NFTs have already gone dark in this fashion. https://twitter.com/CheckMyNFT/status/1369802069729812483
Hell, Jack "sold" his first Tweet for nearly $3M as an NFT. You don't own it. You can't delete it, you can't do anything with it. Jack could delete it! Twitter could delete it! Twitter could make that URL host a page that says "NFTs are dumb". You own the NFT itself.
https://www.cnbc.com/2021/03/22/jack-dorsey-sells-his-first-...
> According to “Valuables,” the tweet itself will “continue to live on Twitter,” but the winning bidder would own the NFT, “signed and verified by the creator,” like a virtual autograph.
This is untrue in practice. In theory an NFT could have no url associated with it. In reality that’s how NFTs were envisioned and how they are actually implemented.
> the entire thing is based around uniqueness within blockchains, so important to highlight when you try to explain what NFTs are.
That’s right. You have to mention the blockchain so that people turn off their critical thinking. Because if you describe an NFT without techy-sounding buzzwords, people will rightly say “that sounds stupid”.
There was a scam scheme on eBay that if you did not read the item description correctly you would be surprised to discover that you paid $2000 for a picture of the laptop, instead of the laptop itself. NFTs are similar, except the element of surprise is missing. People still buy them, because the word "blockchain" causes their brains to shut down.
(if they do - they do it outside blockchain, what makes blockchain part quite pointless, beyond Ponzi part)
Ownership, no. That's a legal concept.
https://www.theverge.com/2021/12/30/22860010/bored-ape-yacht...
> A pair of non-fungible token projects are testing the boundary between plagiarism and parody. Digital marketplace OpenSea has banned the PHAYC and Phunky Ape Yacht Club (or PAYC) collections, both of which are based on the same gimmick: selling NFTs with mirrored but otherwise identical versions of high-priced Bored Ape Yacht Club avatars. Now the dueling projects are selling their apes while dodging bans from other marketplaces, becoming the latest example of how the NFT world handles copied art.
The only thing that determines the real Bored Ape Yacht Club is an off-chain belief that it's the legitimate one.
Hell, they can't even agree on which one is the real fake.
> Somewhat ironically, PAYC and PHAYC have since fought on Twitter over which one is the authentic Bored Ape Yacht Club ripoff, with PAYC’s founder referring to PHAYC as a “cash grab fraud project.” PHAYC charged people to mint its apes, and CoinDesk reports that it took in around 500 ETH (or around $1.8 million) in sales. By contrast, it says PAYC earned around 60 ETH (or roughly $225,000) from its paid sales.
https://opensea.io/assets/0xbc4ca0eda7647a8ab7c2061c2e118a18...
https://nftrade.com/assets/eth/0x176e0fe17314def59f0f06e976e...
Imagine you have zero off-chain knowledge. Which one of these is the real one?
You know Bored Ape Yacht Club and Phunky Ape Yacht Club exist. How do you know which one owns the copyright to the images? Which one's the original artist, and which one's the fraud?
Loosely similarly, if I want to communicate with someone securely they first have to communicate to me their public key but once I have it I can always verify that a message comes from them and send them messages back.
The person who put a JPEG on the blockchain may not own that JPEG. As evidenced by the existence of the Phunky Ape Yacht Club copies.
A list of transactions after that point doesn't demonstrate ownership if you can't demonstrate ownership by the minter.
So yeah, NFTs are like the parent comment explains. Plus that ledger that has no actual meaning.
Edit: I'm not underestimating that giant ledger's technical solution for verifying the piece of paper. All I'm saying is that it doesn't fucking matter.
But again, "it doesn't fucking matter" so no need to reply me, in fact, if you don't care you probably shouldn't, because replying would signal you do actually care.
The technical mechanism of 'Blockchain' might be a novel artifact of the definition of an NFT - but it does not matter.
You're talking about the 'type of paper the deed to the house was written on'.
We don't care about the 'technology used to make the deed' - we care about the implications, i.e. ownership of what, how, when etc..
An NFT is indirectly implied to be 'ownership' of something, but in reality, it's simply 'ownership of the NFT' itself really.
Any legal or popular control over the 'digital content' has nothing to do with NFTs, it's just 'by implication' and has no real social or legal basis.
As such, the 'piece of paper' is a decent analogy.
"It's a record, that references something; you own the record itself, but it means absolutely nothing beyond that".
If you want to think you're cool from owning that, that's cool, or not, or whatever.
It's a good analogy.
You seem to have missed what the analogy is: The piece of paper is the blockchain record, the thing that can be exchanged with other people, not the art or whatever at the end of it (hence why a URL on the paper was mentioned).
It's a great explanation for non-technical people.
Anyone with a basic understanding of NFTs will immediately see that you don't understand what you're talking about if you use that explanation, as NFTs have nothing to do with URLs, art or whatever. It's simply a currency with the total supply being 1. Nothing less, nothing more.
Confusing that with the whole "NFT Art" space is just doing everyone a disservice, as there are people who actually understand NFTs, and are against them, but based on their actual capabilities, not some fake thing you've made it.
Yes, exactly like that unique scrap of paper, of which there is only 1 in existence. The fact that OP wrote an URL on it is not important, it could have been a sticker, or a coffee mug stain, or even nothing at all. The scrap of paper is guaranteed to be unique since you can never rip out the same piece of paper again, the fringes would be all different
I find it a good analogy
a) they have a serial number making each unique b) they are purposefully designed to make it easy to identify forgeries
I can possess all the bored ape JPEGs. So can anyone else in the world who can right-click or screenshot or download a .zip of them.
Not legally, they aren't. I can take someone else's photo, put it up on OpenSea as a NFT, and it'll go through. I didn't own it. You don't own it. The original photographer still holds every bit of legal ownership, regardless of our possession of JPEG copies of it.
> a nonexclusive, worldwide, royalty free, fully paid up, transferable, sublicensable, perpetual, irrevocable license to copy, display, upload, perform, distribute, store, modify and otherwise use your User Content for any Y Combinator-related purpose in any form, medium or technology now known or later developed
What a particular platform does when it sees that relationship is up to them. If no platform does anything with that data then your NFT does exactly nothing.
According to who?
Not according to the government. "Owning" an NFT doesn't give you any kind of reproduction or copyright rights.
Too bad for NFTs that "possession" is a legal problem, not a technological-one. If a court and government doesn't recognise that cryptographic verification, you're out of luck.
You know, like titles.
Most NFTs are like a title to a house. Like a title to a house, you can: 1. Prove you own it; 2. Sell it to someone.
Unlike the title to a house: 1. The party certifying your ownership is not the government, but the consensus rules of a blockchain; 2. The thing you own is not physical, but digital in nature; 3. Your ownership does not prevent anyone from copying the file itself for their own uses.
Regarding your point that the object you own might not be consistent: because of the cost relative of storing data on a blockchain, the actual digital thing you own isn't usually stored on the blockchain, but a hash of that file (e.g. [1]). Unless hashing is broken, this is cryptographic proof that the object does remain consistent.
[1] https://github.com/larvalabs/cryptopunks/blob/master/contrac...
Edit: perhaps the notion of an entry ticket to a concert would have been a better analogy than a title to a house.
I'll agree that the analogy wasn't perfect though - I added an edit for another analogy (still as imperfect as it may be).
NFTs are like a title to a house that you wrote with a crayon.
There is no legal grounds for ownership, its just bunch of people claiming they own something and some other saying they agree.
You can convince whole china + india that you are king of england, but goodluck with actually sitting on the english throne.
A house drawn with a crayon can be considered an artwork or may have sentimental value.
You also have clear ownership of that artwork that you can defend in court.
You will also not loose "ownership" the moment the business that certifies it goes out of business or looses their database to ransomware.
They are the opposite of a title to a house.
The most important function of the 'Title To the House' is that you own the house.
That's the whole point of the title.
An NFT is a homeless person selling you a 'certificate' that gives you 'ownership' of the 'Brooklyn Bridge'.
* Live there
* Remodel it
* Landscape it
* Rent it out
* Etc.
What, beyond selling it, can I do with my new NFT? What does it even mean to own it, if my right to copy is no greater or less than anyone else's?
Basically, imagine a certificate you have on your computer, except it's publicly known, then imagine use cases based on that.
We have that?
Which is to say that I think the problem is less that NFTs are inherently worthless and more that the crypto community desperately needs to reclaim the brand from the speculators, if there's even anyone else left.
For all the cool applications that there might be for blockchain, the only ones that seem to gain traction are the ones that involve highly speculative investment machines. NFTs have been no different, and it's this tendency that makes many people very uncomfortable with anything involving crypto.
The discussion is art NFTs being worthless (or not). Coming in and saying “yeah, but not all NFTs are about art” it’s not helpful. If you think that art NFTs are stupid but the underlying tech has promise, then say that. Don’t defend “NFTs” because that looks like you’re defending the value of the current ones actually being discussed.
Engaging in a semantic argument just muddies the whole issue and looks like you’re defending something you are not.
If you own an NFT, you get no practical real world benefits.
The debate reminds me of when Napster looked, to many, like it would end the sales of pre-recorded music, since music can be copied identically for free. Obviously such predictions turned out to be wrong.
I think they would have turned out to be right if there was no such thing as copyright law. But there is. People were prosecuted, and over time the prosecutions made a difference. They helped it make sense to invest money in creating well-designed, easy-to-use streaming services. And in the end, for most people, it was more convenient and risk-free to get music from such services than to pirate it. It was worth the cost.
Over time, if people spend real money on NFTs, the legal system will evolve to better protect people's purchases. For now, if two people claim to be the creator of a given artwork which is the subject of an NFT, and create two NFTs, only one of them will have the actual copyright. That should provide a basis for legal action.
As I said, I'm not sure cross-game NFTs will ever get past the hype stage. But I have been to a museum where truly beautiful NFT art was on display. I haven't bought any art in many years but I can certainly imagine that my next art purchase could be that kind of NFT. By purchasing it, I am helping the creator in "1000 True Fans"[1] manner, and I am, in the creator's view, which is the only one with any legitimacy when it comes to digital art, the "owner". (Even if I am the second or third purchaser of an NFT, the fact that the original purchaser knew he could sell it to someone like me is part of why he purchased it, so I have helped create the environment where that original purchase could happen.)
While it's true that people can make copies that are identical, people can also make copies of the Mona Lisa that can't be distinguished by anyone but specialists. To the normal person, they would appear to be identical. It isn't what they look like that matters. It's the legitimacy: which is the legitimate Leonardo Da Vinci? It's the one he personally made (and/or was made in his studio by other people under his direction). It has nothing to do with how it looks to the average person.
To one degree or another, these issues of legitimacy and helping the artist will have an affect and give value to NFTs of real art.
I'd also be willing to bet that there will be a long-term market for "collectibles" for the same reason there is for baseball cards. If someone were to make an identical copy of an original Mickey Mantle baseball card, it would have no value. Only the original does, and only because the purchasers believes it is the original, and therefore legitimate, card. The mechanism for NFT legitimacy is different, but there is no reason to assume that that mechanism will not create persistent value over time. It is unclear now how much value it will create. But it would be wrong to just dismiss it at this early stage.
[1] https://kk.org/thetechnium/1000-true-fans/; see also https://future.a16z.com/1000-true-fans-try-100/
You cannot do this with an NFT unless the server that the NFT is hosted on supports it (and has awareness of the blockchain). Then it becomes centralized to that server. You couldn't do it with IPFS.
To the detractors: can you explain what an NFT is without saying blockchain or distributed ledger? An NFT doesn't need those to be an NFT.
1. The paper has an authenticated watermark which cannot he forged by any known technology
2. The paper can teleport a shadow copy of itself anywhere in the world: it can be inspected by practically anyone in the world, without the shadow copy being traded as the real thing
The Bored Ape Yacht Club is an example of this -- you "own" an ape. What that means is that you have the ability to access a restricted section of the website, that only ape owners can access. This membership is transferable without the consent or interaction with the issuer.
HOWEVER -- this membership is not irrevocable. The hash that you "own" is listed on their website as a substring of the concatenated hashes of all apes, which is in turn hashed to make a master hash. That hash can be changed at any time, as can the associated access to the restricted area. New apes can be issued that grant access; old apes can have their access revoked at will.
If you sell your ape to the Supreme Leader of Iran, then the government can force the BAYC to revoke the ape, and they can reissue another one to replace it. I can make my own website that accepts only apes with mustaches into my site's private area.
So really the only thing you get is that the tokens can be traded on third party services.
Except that they are, right? You just described a scenario where a token can be revoked and replaced. This is by any sane definition a substitute.
I suppose you could argue that they cannot be divided or combined, and in that sense you are correct that they are not really usable currency.
But I honestly fail to see how NFTs are actually non-fungible. If an indefinite number of equivalent tokens can be minted, what does it matter if each one is technically unique?
They are strong evidence of a huge surplus of wealth in certain pockets of society.
Why do so many here seem to be so proud of their lack of understanding of the value of NFTs?
If you have an NFT, you get to do things others cannot. That's the value right there. At the very least, holding an NFT gives you the ability to transfer it to someone else and make them the holder. Anyone can confirm that you did in fact transfer it and made the other person the holder.
In addition, you potentially get access to other benefits, such as acceptance of some alternate meaning in the NFT social circle as well as potential benefits in software written that respects the NFT.
What seems to have taken off most is that the NFT social circle will accept ownership of some linked item within the NFTs data. They see the NFT record as a register of provenance that they're willing to recognize.
Do NFTs signal legal ownership? I imagine we're going to find out that it probably depends. But even where they don't, they certainly signify something akin to ownership or possession. And that ownership of scarce goods is precisely something that is valued by certain communities, especially the art trade community.
That you can mint your own NFT with the same data, or that a link in an NFT stops working don't really change the nature of the kind of ownership. What NFTs offer sort of mimics the 'realness' of a piece of art. I can make a picture of the Mona Lisa too, but no one will respect that picture as the real Mona Lisa. While you might lose out on the pretty physical object, you gain in cryptographic provability and potential software integration
> Why do so many here seem to be so proud of their lack of understanding of the value of NFTs?
I think most people are proud of their very concrete understanding of the value of NFTs -- which is zero to anyone not trying to make money on them.
That's the definition of property, yes, but with many real NFTs, aside from transferring the NFT, there’s not much you get the exclusive right to do.
> At the very least, holding an NFT gives you the ability to transfer it to someone else and make them the holder.
And with many concrete NFTs, that's also the very most they give you.
> Do NFTs signal legal ownership? I imagine we're going to find out that it probably depends.
As if it were a mystery how legal ownership was determined. It's very clear that:
(1) It is possible to construct and use NFTs in a way where they would be at least compelling evidence of legal ownership of certain rights, and
(2) Most NFTs in existence don't even begin to try to do this.
> I can make a picture of the Mona Lisa too, but no one will respect that picture as the real Mona Lisa.
Yes, and you can make an NFT that points to a URL that points to a low-effort drawing of an ape, and outside of a small cult no one will equate the NFT with the original artwork (or, for that matter, care much about the original artwork.)
Are you saying if you wanted to sell me Hacker News, there would be a record that dan_mctree sold HN to criddell? I always thought it was just from one mostly anonymous wallet to another mostly anonymous wallet.
We have codified our lack of understanding into a digital token and attached it to an entry in a crypto ledger such that no one else can claim ownership of said lack until we transfer it to them. Thus we have created something not just prideworthy but also scarce and valuable.
It may not have any material objective truth or spiritual meaning but it has a perceptive effect on the world.
I appreciate the honesty but shudder a little at the implications. But I suppose it's one of the ways the world works. It's what we think has value that matters, that makes matter.
But looking at more concrete ways of value: technical merit, anesthetics, practical uses... It's falling short. So people call it for what it is - all hype, nothing else .
At least with crypto coins you can actually send it to people in a decentralized manner - that's valuable! Too bad it's slow, expensive and bad for the environment.
Five of my friends agreeing to share a dirt bike is a social contract after all.
We can also see that many blockchain projects actually rely on more mundane social contracts like our legal system and governments with actual terms and conditions, registered companies and the like.
If you think NFTs are going to radically alter social contracts around ownership on a wider scale I've got a lovely plot on the moon to sell you.
In reality, at the moment a government had authority over those under it.
So perhaps this idea of social contracts reveal both the aim (destroying of society, hype and illusion to create communities) and the weakness (government, monopoly of violence, status quo)
As far as enforcement of property right, the "distributed" model is well understood and typically leads to a much worse situations than the centralized version.
A significant potential and likely harm is enough to consider preemptively regulating.
Some of these blockchain applications are essentially proofs of concept waiting for a legal framework to support them. But until that framework exists, it doesn't make much sense to use the applications for anything that involves real value.
I.e. when my photographer took photos at my wedding I signed a contract that I "own" those photos and all those rights. I can move then, alter them, back them up, sell them to getty, or whatever.
If I draw a piece of art, even digitally I own the copyright. I sell it to someone and now they own it and inherit all those rights...
Is NFT just simply creating a "Block Chain" for this? and if so... is it even needed? What value do I gain from using a NFT over you know a signed PDF that would actually be backed up in court if it came to it?
Is the vision that there is some hot market place for art and other assets that are traded so frequently that we need a live 24/7 market and exchange for them?
Sort of. You can and people have sold digital art (note this is not the same as owning the copyright) with contracts before, but NFTs make it accessible in a way that inspired a much larger group of people to participate (and yes, speculate).
Where things get a bit complicated is that the NFT just grants you ownership of the NFT itself and nothing else. The interpretation of what the NFT represents happens completely outside of the system.
The NFT is thus not a replacement for a contract, but a way to move that contract into a digital marketplace.
For a practical example, take the difference between DVDs and buying a streaming movie on Amazon. If Amazon would sell digital movies in the form of NFTs, people could buy them. If they want to watch the movie, they show Amazon that they have ownership of the NFT and Amazon lets them stream it. When they are bored with it, they can sell the NFT to somebody else and then the new owner can show that NFT to Amazon to proof ownership and watch a stream of it.
Now in reality, this isn't how NFTs are used (yet?). The way NFTs are used right now is really more like trading-cards. Little novelty things that people might see value in, pay for to support the creator or just do money laundering with or whatever. Most NFTs do not give you access to anything, as whatever they are associated with is already in the public anyway.
The NFT does not represent copyright or ownership of the item it points to, but it has the technical capabilities to do so when the right legal paper work is attached to the NFT.
I still don't really understand the logic of all of that, but I understand how it on paper would work. It'd kinda be like when you get a coupon for a free object from the store. Store fulfills the order and sends cost up to manufacture.
Another reason would be that game developers and movie studies start to sell media on their own. So the store would just be a service to download your games from, not the only source of your games. If all the stores stop carrying the media and the studio went out of business, archive.org or similar could take over, as the NFT proofs ownership and you don't have to wait 90 years until copyright expires. Right now we have the situation that some games are already impossible to get legally, as no store caries them and used sales of digital goods are impossible.
Finally, it wouldn't be Amazon starting this, they already have their market dominance and no need to improve the service, it would be the newly arriving competition that would start doing this. Amazon would then have to follow suit to not fall behind. Somebody like Epic might be big enough to get this going and they don't seem to be fundamentally opposed to NFTs.
This is of course all just wishful thinking, but we really need a better way deal with copyright in the digital world. Having media just get lost for 90 years due to there being no way to buy used really isn't acceptable.
On the other hand we already have "copyright without enforcement" for recorded music, via file sharing.
Disclosure: I have 20 patents.
It's still worth at least chatting with a patent lawyer (which I'm not) to make sure what you think is sufficient as a defensive publication, actually is.
Some people seem to think that, perhaps misled by words like "trustless" that are applied very narrowly to blockchain technology.
But the reality is there's almost nothing about blockchain that helps with these trust issues. If I order a physical product and pay in advance with crypto, I have no recourse except a legal one if the seller doesn't deliver. You can set up escrow systems but then you need to trust the escrow provider, and you still need to somehow deal with hard to verify claims like "I didn't receive my package."
That's just one example. In almost every area in which blockchain is "an experiment in what can be accomplished without laws and enforcement," you'll find the actual situation is that it's a learning exercise for those who don't understand why laws and enforcement are needed - or, a way to avoid laws and enforcement for those engaging in illegal activities.
> A decentralized patent system without enforcement was previously something we could only imagine, but now we can try it out.
How? Put your invention on a blockchain and anyone can copy it without consequence. The primary purpose of patents is lost without enforcement.
I thought the social contract is what people do. :) Is it there if it's disregarded?
Or rather what is the social contract supposed to be around NFTs?
When someone inevitably hacks the shitty solidity code and steals your stuff you don't get to cry to twitter or the police
At the end of the day every thing that is truly "enforced" is ultimately enforced by violence.
I can promise that if patents where enforced only by social contract they would be meaningless. Larger corporations do not care about their social relations, but do care if you can have the legal authority to punish them for infringement.
You can write your contract on a napkin and if someone is willing to hurt someone else (materially, physically or otherwise) for violating that, that contract will be enforced.
This is just one of the many cases where the block chain, while interesting technology, has very few uses because there are very few cases were we have a problem with the media the contract is written in rather than the overall enforcement of the contract.
Perhaps they seek to hype it up to become the operators of the monopoly of violence in this frontier?
It isn't a huge market, but every little bit helps.
The crash will be biblical, obviously.
At least with commodity speculation, you potentially have some overpriced goods, here you literally have some nothing.
I really like the efficiency and utility of cryptocurrency but I suspect it will all be set back decades, there will likely be efforts to outright ban/outlaw it after the crash.
You don't know that and you especially don't know when. So please don't use words like "obviously" for things that aren't obvious at all.
What's not obvious to you? If you pick up a unique stone off the street with an art printed on it and value that at 50K USD (remember anybody can pickup a stone and it's not difficult to put art on a stone). And then you have a group of people trading that at 50K isn't it obvious the value will go to 0$ when their interest dries up?
Didn't you just describe art?
[1] - it was revealed to me in a dream
The Million Dollar Homepage is still up. Coincidentally, I just clicked on one of the banners there, and it opened to some website advertising some crypto token.
So, in a way, NFTs are just the latest instance of the same phenomenon.
It's weird how technologists build things without ever researching the philosophical concepts understood by humans, not just machines and algorithms.
That's the real dystopia: when technology is not understood by humans, it becomes useless. The success of computing was about making computers usable by non programmer. I guess the new trend is programmers trying to scam non-programmers.
IF there is a mechanism for someone (or someones) to certify changing or reissuing a token in case of the death of the holder (the passphrase dies with him but the land continues to exist) THEN that same mechanism can be used or abused by the authority to do other transfers and reissues.
The analogy I have been using with my artist friend (who is interested in their use for selling digital art) is a global bulletin board.
I can't fucking wait for the cryptocurrency/NFT scene to come crashing down. Not because I want to see people hurt, but because that should (hopefully?) shut these people up for a generation.
NFT gif collections are obviously speculative money/crypto-laundering garbage, but there is a real use hiding in there somewhere.
How can I trust an NFT? I don't know if the person minting it was the true owner, or just someone uploading stolen content. I don't know what the URL used to point to or if the content has changed. It's basically useless without something external verifying it.
It's like having a notary that can notarize NEW things in a way that you won't tell every new notary how to notarize it. I think that's kind of cool
Was anybody else around for CryptoCelebs back in 2017/2018? It was literally the same thing. You’d buy a million dollar NFT of Zuckerberg and hope somebody else would buy it from you for two million. They called them “hot potato” games back then.
You are not paying for the jpeg, you are paying for the (digital) signature of jpeg's author, or some other famous person. For example, a picture of sunflowers bearing my signature is worth zero, but if it were signed by someone with the name van gogh, it's worth millions. However, the signature of the latter can be forged, and has been forged many times successfully. It's very expensive to verify authenticity of a physical signature. That's the problem the digital signature on a blockchain solves. The NFT site verifies the famous person's identity, and appends an unforgeable timestamp.
There are a finite number of famous people, so the resulting digitally signed item is scarce. That's where it's monetary value comes from.
You are married. Your spouse is cheating on you right in front of you with multiple people. But you have the marriage certificate.
A lot of these critiques betray discomfort with abstraction.
What does it mean to own a digital item? I think that a minimal definition should include a unique access to it/or its capabilities: people who own the item are the only ones who can access it. Clearly, the current system does not allow this (everyone can access a picture sold as an NFT). Moreover, it is not clear whether such a system can be built for digital items.
In fact, it seems to me, that a system that transfers the ownership of digital items can only work if the items cannot be copied; if I buy a digital item, copy it, then sell it, I still own it after selling it, which means I did not transfer it.
This brings the question, what are the properties of items that cannot be copied (or are hard to be copied)? Complex systems could be such examples. For example, neural networks where inferring the network is extremely hard to be done from input and output. Assume that the item is a neural network that can generate a voice of an artificial character, or an interactive 3d model of an avatar. If, the system gives me exclusive access to the network, I would be able to use it to generate the voice or the 3d model of my avatar in a metaverse, however, I would not have access to the code that generates this data, only to the results of this simulation.
TL;DR A digital ownership system (like NFT) is only meaningful for items that cannot be copied. These can only be complex systems where the ownership scheme gives access to the output of the system and not its totality (think voice generation system)
That said, is this guy even correct about having no recourse to enforce your ownership? If I buy a NFT from a guy in Germany don’t I have the same recourse as if I bought a Rembrandt from a guy in Germany? Sure if it’s $100 good luck getting any movement or if it’s from a guy in Iran also good luck getting any recourse but if it’s from a guy in Georgia (the US state) don’t I have the same small claims court infrastructure as if I bought a used PlayStation from him? Same goes for that German guy, if it’s above some threshold there is also certainly some kind of reciprocal treaty in place for me to engage with the local German court/police infrastructure to seek compensation.
The NFT is a link to something, and buying the NFT means I get the ownership of the NFT. But I've no idea what this actually means in the end, which rights do you get by that? I paid someone $100 and got a link back, everything else is completely unclear. I've no idea how a court would be able to fill in all the blanks here.
But what if they no longer own the domain and it's now owned by an opportunistic squatter? The domain wasn't part of what you bought so the legality of forcing the squatter to provide you the domain isn't quite so clear cut. You still of course own the ledger entry asserting that your payed for the url but you have no legal recourse to ensure that the url stays up.
That's like saying "I'm anti-vax and feel good every time someone vaccinated gets COVID".
They're just a simple use of smart contracts, which are basically functions that don't live on a server. I can choose to deploy something onto Cloudflare Workers or on a chain.
Most code I'm still deploying on CF! But there's a few functions - like signing functions that bind ownership of a piece of submitted genome sequence data - that I want to live on-chain, bc if it's off-chain, I (or someone else) could more easily become a bad actor, by deploying bad code.
Every argument against it has been heard. We get it, you don't like blockchain. You don't like expensive inflated art. You think the art has no artistic value. I actually don't care about the artistic value.
But this isn't even about the "Boring Apes" bullshit. So what if someone buys an "URL" to the picture of a monkey? Really, who cares? Well. Apparently a lot of people.
I disagree that NFTs are "useless". The "Boring Ape" whatever may be a dumb (but popular) implementation of NFT technology. But NFTs are not useless. NFTs are a way for people to record data on the blockchain and claim their ownership.
If what you're worried about is dumb people buying things that actually have no inherent value, I have some bad news for you.
I don't even hold NFTs. I think their (current) implementation gives me nothing of value. But that doesn't mean they are useless.
It's like saying IRC is useless because you can't post pictures directly or something like that.
Technology is technology. Maybe more or less efficient but technology is not inherently useless. What we do with it is what matters and I agree NFTs aren't bringing real value at this time.
And it’s entirely reasonable that people would be worried about gullible people buying worthless things. We call these scams and they are bad for society in general. I also worry about old ladies being conned into unnecessary roof repairs and I worry about dumb people falling prey to email scams and I worry about all sorts of other con artist activity because it’s bad stuff and harmful to society.
> An NFT is like being the Foursquare Mayor of a JPEG
When the average person conceives of just how useless they are, they might start to see the ridiculous inefficiencies of our intellectual property system.
Well, If a baseball player signs a cap of yours, then that cap suddenly has a value, however there is no way to say that you "own" a signature/cap pair. If it hangs on your wall, then you own it. But I can go buy the same cap, copy the player's signature and hang that fake autographed cap on my wall.
NFT is pretty much the same thing, imho.
This is also why value of such things tends to go up after the player dies. It’s no longer possible to make similar works so the scarcity is locked. Again, not true with an NFT.
That doesn't necessarily make it worth much, but the utility of it is great.
Want to make a declaration, and be able to prove you said X on Y date? Just create a transaction on the blockchain with your message and you have millions of nodes committing it to a public ledger.
The current NFT craze seems more like a simple money grab, but I still hope the technology finds a way to survive and become mainstream.
But what we have here is an overblown reaction to a working proof of concept of a valuable idea. NFT’s as I understand is just a digital sign of ownership. The twitter author suggests this is useless because “you don’t really own a gun in a shooting game” (paraphrasing here) but downplaying digital ownership of things people find value in is downright silly. If people find something to have value, it does, and that’s that. Being able to transfer digital signatures of ownership for digital assets is a good way of trading that value without much third party intervention (in theory).
For example one idea I can see working if implemented properly is digital ownership of games (some of the GME hype seems to be based on this). Transferring ownership for games used to be owning the CD and having a serial code. Moving proof of ownership to an immutable ledger seems like a great way to ensure only one copy belongs to one person, and opens a digital good’s ability to be bought and sold like a physical good.
Or perhaps a way of tokenizing real estate cheaply and securely. Or tokenizing digital brand good from artists. All with less takeaway from a middle man (hopefully).
I find the whole scene fascinating, and although I’m not invested in anything because I think the proof of concept is overblown and the value attributed will dwindle as people realize that the use cases of NFT’s are much much broader than just art, I find the technology to be a promising use case for blockchain in the real world. The entire scene still feels like it’s in its infant stages and it’s putting a lot of value on memey things (I guess that’s just for the times call for) but I think the value proposition of NFT’s could potentially be massive. Time will tell.
The masses however can not read out a word to its fullest letter like "cryptocurrency" they stop at "crypt" oh, and say "crypto". These are the people in the "crypto market" now to buy "coins" and "tokens" to get rich because "they believe in it" (but because theyve been told and seen someone made x1000 buying a token and selling it later to someone else) They are like flat earthers and evolution-deniers and "covid is ebola black bubonic plague vaxx everyone 110%" people.
These people can not pick between 1000 coins which one is real innovation in consensus algorithms or whatever, and which one is a scam, like BitConnect or IOTA.
These people know this, so they do the next best thing which is hunt for coins based on logos and overall marketing looks of the coin. This was not enough because the cryptoh projects used fancy words, its easier to just pick on logos, and even easier than logos with a project and website is to trade logos marked as NFTs.
Surely it's at least possible that accessing the actual asset behind the URL is authenticated by the same public key that verifies your "ownership"? And indeed for the rest of the concept of ownership of the asset to be taken seriously - i.e. I the buyer can tell the hoster "I have made a local copy, or just plain feel like burning stuff, delete your copy please". Or "please move the asset to this hosting service instead".
Obviously that still has the same copying issues that the RIAA and MPAA and whoever else have failed to deal with so you probably aren't going to do any better. But, at least try?
Oh, look, another upcoming crypto-thingy. Let's chuck some of my luck-money at it to see if it makes more!
Annoyingly, some of them will be right.
Talking about who 'owns' the jpeg isn't the big deal, it's content that matters.
That the image is at a URL which is fixed is a 'bad technical issue' that might even be fixable in some way in the future.
But you buy make an NFT of Mickey Mouse, and literally it would be illegal to show it anyone publicly.
However, NFTs are notarized, instantly transferrable, and trackable pieces of paper.
s/instantly/fast -> NFT
The ubiquity and stability are the value.
Other than that, theoretically, sure. They are no different. But that difference makes all the difference.
You can't attack the very concept of NFT. It's identical in concept to fiat currency. It has no inherent value, but it can't be easily forged. The only technical difference is NFTs are even more resistant to forgery than minted money.
TL;DR NFTs that point to centralized mutable databases like s3 are a bad idea, but people are working on immutable data storage technologies like IPFS.
If the asset hosting is both immutable then you're guaranteed to always get the thing that you bought from the url your NFT points too. By being "distributed" I think the idea is the immutability is more guaranteed since no one person will be able to control the database.
You are not answering the question posed.
What do you think you are "getting"? Sure, the pointer will always be the same, and the target will always be the same, and you will always have bought that pointer from some other wallet.
Now what? Can I make other pointers to the same target? Can I make a first pointer to a target I did not create? Can I duplicate a target to a new URI and make a pointer to that and sell? Who enforces my ownership rights?
The value of contracts are the enforcability of them, not the properties of the paper. It can be a CNC cut piece of aluminum or a napkin, the contents and the signatures are what's relevant.
To connect this to main issues with NFTs (currently at least):
* A wallet ID will never change, but I could lose my wallet to someone else, thus the immutability of the signage does not guarantee the immutable connection to a person.
* NFTs (afaik) contain a tokenID, tokenURI, baseURI. I guess that can be read as "wallet X signs over this URI which contains an image of the Mona Lisa to wallet Y". Which is entirely different from explicitly stating "wallet X signs over all rights to the Mona Lisa to wallet Y".
At some junction in this chain (as far as I know as an NFT skeptic, to put it mildly), you (want to) pay for ownership of something non-fungible, be it meatspace or digital. So sure, that thing at the IPFS URI might never change, but I can still copy it, or it might not have originated there, or it's some representation of a real world item, where the representation of course can be reproduced.
You've added another layer of immutability, but I have yet to see where that's relevant to anyone who understands what they would be buying, as there are always more layers.
The dark thing about NFTs IMO is that they only seem like they would work in a "world" where everything was locked down and rights-protected to the detriment of the user experience. In other words, all those "layers" where digital ownership could get fuzzy were removed by operating on some aggressive platform or protocol, like a Fortnite style Metaverse without copy + paste, local file storage, or self-hosting.
I really wish IPFS would stop flirting with NFTs. I rather like the technology and it doesn't really have anything to do with NFTs but I'm afraid there will be a stigma attached to it when this thing finally explodes.
One thing I haven't seen anyone mention is that even the thing referenced by the ipfs url must by bit for bit identical. There's no notion of semantic ownership where you can own an image of the Mona Lisa and we can all agree that slightly different versions are still pictures of the Mona Lisa. I can flip one bit and sell that as another NFT. I can even make those changes in the image meta-data so the actual image is bit for bit identical. Also IPFS does not provide unique id's. An image can have multiple IPFS id's. The uniqueness constraint goes the other way, and IPFS id references one and only one unique resource.
>> It records a crytocurrency transaction and appends arbitrary data to the transaction.
Seems contradictory. They do nothing...except this thing that they do. Seems like just another "old man yelling at the clouds" style thread to cause controversy and generate engagement without saying anything remotely new or interesting.
> It records a crytocurrency transaction and appends arbitrary data to the transaction. That's it.
> None of those functions are inherent to the NFT. They all rely on external infrastructure, which exists independent of the NFT. If you're wondering what role the NFT does play, then, the answer is nothing-- it parted a fool from his Monopoly money. That's it.
Any and every blockchain supports that thing. The objection seems to be that what NFTs "add" are an unenforced and unenforceable agreement. There's no new technical (or legal!) feature.
This makes them seem more like a (poor) proof of concept than anything else.
This person is thinking far too small. NFTs are not only about art, apes. etc. Any non fungible asset or piece of data can be represented as an NFT (not exclusively for trading / speculation).
"It might, speculatively, become as good as the existing thing accepted by society and most crucially the legal system" isn't a great selling point.
I guess that's exactly their point: We have this. What the hell are NFTs supposed to bring to the game?
It really doesn't. Ownership is a jurisdiction-dependent, item-dependent, legal concept.
In the US, your bored ape JPEG will become public domain either 70 years after the creator dies, or after 95 years if they put together a LLC or something to sell them.
You can wave the NFT around all you like at that point, but you no longer own the artwork, at least where the US is concerned.
You're skipping something important: ownership of what exactly?
But to your new point: Even if it might be enforceable (which would completely undermine the point of having an NFT on a blockchain in the first place as you would rely on the same current system you try to replace anyways), the very much nature of having ownership stored in an NFT would mean that this ownership in many scenarios could of course not be enforced by the legal system. If you get your private key stolen you have lost that ownership and there is no way to restore it. So to your question: no it would not be enforcable.
Further, there are more benefits to using a blockchain than proof of ownership. You can tokenize your new non fungible assets, transfer them permissionlessly, use them as bearer credentials, etc.
Not trying to be offensive here, but you and others in this thread are thinking way too small about the potential usecases of NFTs. They are more than just pictures of apes.
They sign a tx and give it back or you get compensated in another manner.
https://ipfs.io/ipfs/QmdNvqCbd7qYvtyFJdd3zoJC84cvyCiSxYDfsiY...
This IPFS record gives the Makerspace gateway address for the artwork so you can view the image the NFT supposedly refers to:
https://ipfsgateway.makersplace.com/ipfs/QmNopeEan1r728EGpAY...
These are all just references, they don't represent the image itself. If Makerspace goes away so does that copy of the image, and the NFT becomes a reference to nothing. The NFT doesn't even include a hash of the image, so Makerspace could replace the image with another one and nobody would be able to tell. What image did you see when you opened the URL? Are you sure it's the same one I saw? How would you know?
All you own is some bits on a blockchain containing a URL to someone else's website that has no relationship or obligation to you. A lot of NFTs refer to Cloudfront URLs. Do you think Cloudfront gives a crap about your NFT?
No it can't. In particular any physical non-fungible asset can't be represented by an NFT in a way that is useful. This is because there is no mechanism within NFTs or the blockchain to enforce that the owner of the NFT must also be the owner of the physical asset.