NFTs legit or mania?

I’m personally at the stage where it seems like such obvious silliness that I feel like I must be missing something, and so I avoid expressing this opinion anywhere that I might be held accountable for it at some point in the future. But I still suspect that I’m right, naturally.

Definitely interested to hear arguments to the contrary though.

People have been doing stuff like this for a long time - trading cards, the kid who was selling pixels on a web page (https://en.wikipedia.org/wiki/The_Million_Dollar_Homepage), astronauts were taking items in their personal kits with the intent to resell them later for high value etc.

I suppose that we'll see things like these get more weaponised as people look for easy ways to make money. I'm not interested in participating.

Commodity fetishism, what an example!

I expect NFTs to be a trend. It's much easier to fetishize a physical commodity than a digital one. What you're paying for is the imagined blessing imbued by the creator and access to the content (which can be leaked).

If you understand how NFTs work and appreciate the art, you might imbue the NFT with the magic blessing of its creator, and then translate the feeling over to the rendering. There's a gap here.

That magic is going to fade quickly because any rendering of the content (easily leaked, copied) is hardly related to the fact that there's only one of the NFT. Let alone if you're not constantly displaying it to remind yourself.

I could see NFTs as a value store / speculative investment, as a more honest version of the upper-crust art market. But what you're paying for is essentially feelings and leaky exclusion of the content.

It is a scam, as a rule if it is "X but on a blockchain" it's a pump and dump scam. "Art ownership but on the blockchain" will make a handful of people very rich, at the cost of everyone else who follows the pump and dump.

Here is a thought experiment. There's a neutral party in Switzerland that will mark you as the owner of a digital item in their ledgers kept in a Swiss vault. you can buy and sell ownership as long as you call up the Swiss 'Meme ownership broker', but that's it. Does that seem silly? Doing it on the blockchain doesn't make it less silly, if anything it makes it sillier since there is a lot of pollution in order to have everyone run the Swiss Register.

It's not mania. It's a vision for competition, control, restriction, & ownership. It's the value system of limited natural resources, imposed on a much more open place where bits are cheap, where copying is basically free, where vast amounts of computational capabilities are everywhere.

It's not going to go away. This camp of control & authority & power will find enough adherents to make that which is without value have value. They will recruit enough suckers to buy in, spread this new religion. Society will think it cares about this dark, against-the-point menace. We will almost certainly decide these things have value, and fight & squabble & "invest" in these things. Alas. L. Ron Hubbard created a religion based on aliens & purity, & these folks are asking for faith in ownership & scarcity.

We will have to keep hearing about these dark disciples for decades.

Just like everything else in the crypto space, it is both.

This stuff isn't going to die out completely and the exact way that people interact with it is going to develop over the next years.

On the other hand it is very possible that current prices are a mania although there is certainly some possibility, that in the long term, current prices will prove to be good buys.

Most of the uses I've seen so far seem like nonsense to me, though I could imagine a known and popular fine artist creating some digital art along side physical works as a way to create a more affordable entry point to their fans, much in the way that prints are already a more affordable entry point than paintings.

I think in such a fine art case there needs to be some good ways to display such NFTs though.

I think it's both. IMO we are in a mania and this will ballon before it comes back to reality. After that it will just become "normal" and perhaps a de facto standard for "digital ownership". The applications are broad, and I'm not sure of the lasting value of individual "collectible" NFTs, but the world is on the cusp of embracing what it means to "own" a non tangible good, and that's really interesting.

Full disclosure: I do sell art as NFTs on one of the curated platforms, and I do get to benefit from the current "mania", but I'm not one of the big name artists, to me the whole NFT thing as it pertains to art is more like patreon. It's a way for folks to support artists they like and to have a (non physical) piece that they can show for it at the end of the day.

They're both legit and mania. Yes, you can cryptographically own a token that represents the first tweet. Is it worth $2.5M? Not really. Some rich kid is just showing off and wants to make news. You could say that the value comes from the stupidity of it. Art is not very easy to understand or value objectively.

NFTs may have real applications in enabling markets for intellectual property like copyrights, patents, and what not. For example, it would be possible to automatically stream money to one or many NFT copyright holders from a decentralized Spotify. It is also possible to tie NFT in smart contracts, so that the owner is able to call special functions or change the state in the contract. For example, if an ad spot on a website is controlled by a NFT, the NFT owner would be able to change the ad.

All depends on the specific incentive models. If an NFT holder aims to increase speculative value, they turn into vocal champions of the work. That drives a great deal of the cryptocurrency space to date - there's no particular reason why it will fail for art.

And this was previously done in a very exclusive way, in elite venues, but now it's possible to throw open the doors and make it like eBay - without even needing the seller ratings.

So, you are not interested in learning new methods to launder money? How quaint.

Mania for now but long term it will bring scarcity to the digital realm something that's important to fully develop the digital economy. Right now digital has been very profitable for a relatively few since it takes lots of money to develop a product but scarcity will let many more people make a living.

A simple example are artists. Artists have been mostly locked out of making a good living with their digital works but NFTs will fix that.

We will also start to see new forms of products that aren't profitable now since there is no way to cover the costs to develop them but with NFTs there is now a way to cover the costs.

I see the book market changing. Established authors will be able to sell their books and not have to go through publishing houses. They can sell them to the public and now the public will be able to resell the book and gain some of the money back and the original author can get some money too.

The future is very bright, as they say. There's finally a way to monetize cyberspace for the everyman.

Regardless of the premise, anything that so needlessly worsens the climate emergency by wantonly wasting energy isn’t future proof.

Long-term, I think it's legit. A few big-name artists and other popular figures (athletes, actors, etc.) will take advantage, and use it as another income source. It's pretty convenient to immediately get a large payday by selling a unique asset (think of an autographed copy), while also being able to mass distribute and sell it at scale. For example, most people don't know that rookie cards for NBA players can go for well over a million dollars. Same idea here, except it is hosted online and cryptographically proven.

In the short-term, definite mania. Relatively unknown artists are getting ridiculous amounts of money, several magnitudes more than they get on the open market with a private commission, because the supply of artists that are currently active in this market is dwarfed by the number of rich crypto speculators that are throwing money around, trying to make a profit.

I recall a few different attempts to connect vehicle-title-like rights to physical artwork using the bitcoin blockchain. One of them was being worked on by a partner at a hedge fund that invested in Gliph.

I also remember some startups attempting to assign music licensing using possession of some secret connected to a public ledger.

I had a family member refer a colleague who taught continuing education courses for insurance agents ask for information so he could speak to the potential future of insurance contracts being done on-chain.

These are all examples from years ago, and included some form of the key characteristics of NFTs as described in the article: non-interoperable, indivisible, indestructible, verifiable.

NFTSs seem put an emphasis on the items they secure being purely digital.

I don't see NFTs as a new idea but possibly consolidation of pre-existing ideas into winning standards, (ERC-721 and ERC-1155 potentially), and perhaps generalized buzz around bitcoin and crypto.

Consolidation to a standard, endorsement from perceived sources of authority and a way for new people to still "get rich" in crypto might elevate this to something that goes the distance.

But I'd expect a lot of folks to be burned in the meantime, "investing" stimulus money on things that go to zero.

Anecdotally, when I was evaluating Clubhouse, one of the major detractors of the service was how much emphasis the communities put on scammy get-rich in real estate or other seedy business ideas. There were a lot of groups on NFTs and that was a few weeks ago.

I'm most interested in how digital assets created on the fly on someone's phone can be quickly secured to allow fluidity in the transfer of rights.

People are capturing more and more important events first hand. However validating authenticity, ownership and authority to license that content seems kinda messy right now.

I suspect NFTs could play a role in standardizing assertion of rights over content, it doesn't have to be deliberately created but rather by chance.

A more fluid market for opportunity-based "stringer" content is teased at in Neil Stephenson's "gargoyles" of Snow Crash.

I don't know if NFTs will be the vehicle for this but something like them will be, and whatever that system is will probably consume these more shiny "assets" appearing so far.

If you look at it from the point of view of an engineer, it appears to be mania: it doesn’t provide DRM despite implying it does (to some extent), and it’s unclear to what extent it actually encodes and stores the content.

However, if you don’t look at it from that point of view, then clearly it’s filling a previously unserved niche (though that may end if users find it violates their expectations). In other words, the need for it appears to be real.

The DRM issue could be addressed on the client side - if enough client applications (e.g. games) enforce the implied DRM, then that may be enough to satisfy this expectation on the user side.

> NFTs legit or mania?

So you are comparing it to Canal Mania in 1793?

I think yes, there will be NFT's sold far to high for investment purposes right now, but others that are profitable, it will be an on going business / art form.

I personally think $2.5m for the first tweet in a mature market would be embarrassing. Are you allowed to destroy the first tweet, if you are getting true control then yes I think it might be worth $2.5m. Else you are not actually buying the first tweet, unlike art created only as NFTs. So that has a embarrassing side, you're a rich person who doesn't even truly own it.

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

it is mania, but so are a lot of collectinf hobbies. NFTs are attractive to those who value physical minimalism but still value a sense of ownership of something.

identity is tied with ownership because it allows one to say they either created it (authorship) or they have the possession of it (ability to transfer / sell/ destroy) - NFTs are an extension of the human desire for identity.

they suffer from the false scarcity effect, that even with their distributed nature, rely on a central authority (the same as those certificates included in collectors items) - it's a matter of valuing the platform AND the NFT itself. that is a flaw imo.

I think we will see something of a hybrid. NFTs that have real world utility and physical practicality. even for games. we need to have FUN. not just scarcity.

these are not going to be great but they will last. most will be worth nothing and will make money for the platforms and some prolific or already existing artists.....

not the game changer yet.

It is built to be mania!

People don't create a collectible market without hoping for some sort of bubble.

I’m guessing mania, since a day after I first saw the article about them in HN, “normal” people were talking about them to me.

Can it be used for DRM protection?