Non-Fungible Tokens - creating scarcity and value in a digital ecosystem?

What is there not to like about new technology or system that allow for wonderfully shady and useless practices to flourish.

There is sometimes a big difference between the promise of a technology/system and its real life implementations. I.e. bitcoin is literally just making the world warmer, pure waste of energy. The concept is really cool, but the reality is not. How happy aren't criminals that now can use the bitcoin without any real interference from various department of justice.

Do we really need more fake-art systems that is there solely to drive "tax write-offs". Now, granted there is a lot of stuff that is "waste of energy" and "crap", one can argue that sports is stupid, arts, etc... I am all for folding-economy in which the actual "waste product" is a boon to society in the form of computational power for important projects. However, now we have shortage of graphics cards, and the makers are even gonna start doing "mining cards" (even whole laptops are being bought just for access to the graphics cards), there are places with shortage of electricity that still have bitcoin farms...

So what will happen, is Trump now gonna sell his banned twitter-screenshots, or grant them to a museum for a sweet tax write-off... For 5% fee I can value your NFT really high.
 
We joke here, but this makes me not trust the entire cryptocurrency space. It just seems like at any point, someone can turn the light switch off and your holding value would be forever changed. Too few actually know how to create and manipulate this stuff.
 
ahalpert said:
What's the difference?
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Proof of Work: In order to keep the blockchain in sync a pool of computing resources validate each block. They are rewarded with crypto. Since the syncing of the blockchain is an easy task the computing resources are forced to expend energy in the form of finding a solution to a difficult math problem. The first to find the solution gets the reward. The computing resources are mining energy for crypto in effect.

Proof of Stake: In order to keep the blockchain in sync a pool of computing resources validate each block. They hold a significant amount of crypto which they stake as a guarantee that their calculations are honest. No extra energy needs to be expended.
 
Bassman2003 said:
We joke here, but this makes me not trust the entire cryptocurrency space. It just seems like at any point, someone can turn the light switch off and your holding value would be forever changed. Too few actually know how to create and manipulate this stuff.
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It is akin to the proliferation of computing. Once the domain of geeks and nerds, now everyone is stroking the computer they keep in their pocket. There are many useful use cases for crypto, smart contracts, and NFTs. Someone in Switzerland was trying to send me a bank wire for my 8x10 Sinar. He gave up after 3 attempts. He could have sent BTC or ETH in 15 minutes. NFTs are a great way to track and validate ownership of both physical and digital assets. A digital asset like a photograph has a unique signature. That signature can be recorded along with the conveyance of rights or ownership. Validation is then easy. Add the blockchain reference in the image metadata and you can then prove that your use of the image (or video, audio, etc.) is legal.
 
Bassman2003 said:
We joke here, but this makes me not trust the entire cryptocurrency space. It just seems like at any point, someone can turn the light switch off and your holding value would be forever changed. Too few actually know how to create and manipulate this stuff.
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I'm not sure if that's true about a switch being thrown and changing the value of your holdings. (Although governments may try to do that since cryptocurrencies obviously compete with their fiat currencies and are beyond their control.)

But isn't this just like the value of gold? Gold has little inherent value (except as a use for electrical contacts and in chemistry, etc.) But its real value comes from the fact that other people value it and the supply is limited. And it's not like everyone is going to suddenly decide overnight that it's worthless and they also don't want to wear it in jewelry.

The value of bitcoin and NFTs is the same, right? Other people want/value it, and you can prove that you own it. And like gold, I think that equation is very stable in the long-term.

That's why someone just paid $69 million for an NFT of Beeple's massive 5000-work JPEG. There were like 353 bids on that artwork and multiple bidders bidding above $50 million.

And even fiat currencies have no inherent value. Last I heard, they were using Zimbabwe dollars as toilet paper
 
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True about currencies, but gold is a physical asset that you have mine out of the ground to get. The reason why I say flip a switch is that what if 'all of the sudden' it was announced that more Bitcoin could be produced? Do you think the world would show restraint and not digitally replicate more? Would you trust it? Would you not trust it? Software design is built around rule breaking and while I trust the blockchain technology, I don't trust the (few) humans who know how to work this stuff. Probably my ignorance but big money tends to bring mischief.
 
Bassman2003 said:
True about currencies, but gold is a physical asset that you have mine out of the ground to get. The reason why I say flip a switch is that what if 'all of the sudden' it was announced that more Bitcoin could be produced? Do you think the world would show restraint and not digitally replicate more? Would you trust it? Would you not trust it? Software design is built around rule breaking and while I trust the blockchain technology, I don't trust the (few) humans who know how to work this stuff. Probably my ignorance but big money tends to bring mischief.
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I had similar misgivings but I've viewed enough discussion on the topic to accept it. In some ways Bitcoin is more reliable because it isn't controlled by people per say, there is a limited and fixed amount, there is so much money in the system that those players have a vested interest protecting and maintaining the rules, and it's decentralized so there is no one at the top to corrupt. Gold for example the supply is unknown and not fixed. Let's say someone found a huge deposit. Fiat currency government are free to print as much money as they like without your approval. If you feel more comfortable putting your investments in gold, no one is putting a gun to your head to invest in Bitcoin.
 
From Bloomberg opinion:

Is it crazy to pay $69.3 million for a digital artwork that is itself a composite of the artist’s other major artworks? More specifically, is it crazy to pay that much merely for the right to claim you own the original copy of a collection of pixels that can be reproduced by anyone?

The more I think about it, the more I think the answer is no — an emphatic no. This purchase is not only sane but also bold and brilliant.

Some background: The work in question is “Everydays: The First 5000 Days,” by a U.S. artist who calls himself Beeple. And the original copy is inscribed on the blockchain, an example of what is called a non-fungible token, or NFT.

NFTs stand a reasonable chance of being an entirely new art form, and this may be the beginning of their long, noble and (yes) controversial history. The buyer of “Everydays,” an investor who goes by the name Metakovan, may well be remembered as the first patron of digital artists. That is a legacy you cannot buy for any sum in most other walks of life. You can become a kind of Medici of the blockchain.

Such a role is not for everybody. But this $69.3 million will probably not meaningfully detract from the private consumption of Metakovan, founder of a cryptocurrency fund called Metapurse, which invests in NFTs. No doubt he will still be able to buy a yacht and the world’s finest sushi.

Maybe NFTs will not endure, which is a risk for anyone playing a pioneering role in a new genre. That is why the price was not $200 million or more. In any case, this is a world in which Marcel Duchamp’s urinal sculpture still is exhibited in major museums, regarded by many critics as a masterpiece of the 20th century, and it sold at auction for $1.6 million in 2002. Canvases painted a single color, and other forms of abstract and conceptual art, remain a major part of recent art history and can sell for tens of millions.

The point is not to argue over what qualifies as “art.” It is simply that it is a mistake to assume that NFTs will fail in the art world.

Keep in mind that as the value of bitcoin and other crypto assets rises, more of the world’s billionaires will trace their wealth to crypto. It is unlikely that they are all looking to buy Rembrandts and Picassos.

Does it seem absurd that the original copy is so valuable? Well, this is hardly new. A first edition of Jane Austen is worth much more than a third edition. 1 Meanwhile, a forged copy of a major artist, no matter how skillful or indistinguishable from the original (ever see a forged Malevich?), is almost entirely worthless.

Or consider the purchase of NFTs as a purely financial investment. In many nations works of art can be donated to a museum for a significant tax break. Such donations often bundle prized works with lesser-valued works — but appraised at relatively high values and thus involving significant tax benefits. Another common element behind major purchases of artwork is that buying art can be a way of moving assets from one place to another, if only for reasons of privacy or portfolio management.

With his purchase, Metakovan has now generated significant publicity for NFT artworks and boosted their value. His portfolio of NFTs is now probably worth much more, and in net terms he may well be wealthier than the day before he bought “Everydays.” He is also now known as an especially important collector of NFT art. Other artists and sellers may offer him their best works, hoping to be affiliated with a prestigious collection. He will be at the center of an information network about valuable NFTs. How is that for clever?

The second buyer in line for “Everydays,” the cryptocurrency creator Justin Sun, was offering $60 million. Maybe both he and Metakovan are crazy. Alternatively, if the internet really is changing everything, why should the art world be immune? Maybe the crazy ones are those who expect the future to look just like the past.
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https://www.bloomberg.com/opinion/a...-craze-actually-does-make-sense?sref=X9N3NABa
 
FrameFarmMedia said:
My guess is NFT's will be like most of the fine art world and be propped up as an outlet for money laundering.
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Could be. Thus far it seems like a flex. The 2 Indian buyers of the $69 million Beeple said they were making an anti-racist statement by outbidding everyone else and adding a "splash of mahogany" to the palette of art collectors. Then you had Saudi royalty buying the last Da Vinci available for $500 million. Bragging rights. But sure, lots of laundering too.
 
ha, Jack Harlow might be wearing some lifts in those boots standing next to a 6'3" PD. Or maybe it's just the camera angle.
 
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