Are NFTs Dumb or Smart

[clearbluesky15 1936]

A month ago I was talking with someone asking about NFTs who was looking for a more intuitive sense of what they are.

The short summary is they are typically 'assigned pointers brokered by a smart contract typically on the Etherium transaction ledger.'

In practice with the most common examples in the press, you're buying an official pointer to a work that you can then transfer... and some theory why if another person made an AFT of the artwork, how that might cause them legal trouble (though no precedent yet).

This was a great explanation that gave a nice, intuitive explanation, with graphics: https://youtu.be/IZaTd0hDtkI 

• 00:00 -12:00: Background on blockchain
• 12:00 - 20:00 Discussing the concept of NFTs of hard and why that could have value.
• 22:19 - 24:15: Discussion with Lawyer on legal basis.

 

There are 3 people on this board, that I think would especially enjoy this: the provider I discussed this with, a provider I know follows technical topics closely, and a client that often starts technical threads. I wonder if any of them will respond :).

 

-cbs

[Greenteal 41578]

         This is best described as a speculative market in the crypto world. If smart/profitable or not will depend on your knowledge of the market and your ability to sell those before the "bubble" eventually burst.

          We seen this before with comic books, sport cards, vintage toys, Beanie Babies, vintage watches and currently with vintage video games and used cars. Often fueled by misleading headlines of questionable transactions where the buyers, sellers, appraisers and auction houses worked together to inflate the value of certain items. It creates a temporary spike in prices where very few actually see a return on their investment.

           Not saying it's impossible to make money out of it. But without inside information, it's more a question of luck than actual investment skills.

          

[clearbluesky15 1936]

1 hour ago, Greenteal said:

 a speculative market in the crypto world

Agreed. At least in those earlier cases, you had something tangible.

Having one's name in the blockchain as the designated pointer to a picture posted on the web... less so, the analogy in the video was a "signed copy" of art by the artist (or a signed copy of a celebrity by that celebrity). I loved the piece about the legalities of making your own NFT of someone else's art / work. Mechanically you could... there's no precedent where someone has been pulled into court... but likely not a good idea.

BTW: Clickable form for the above link for those wondering... https://youtu.be/IZaTd0hDtkI

[Greenteal 41578]

3 minutes ago, clearbluesky15 said:

Agreed. At least in those earlier cases, you had something tangible.

   Tangible or not, a market needs a certain amount of transactions to stay viable. When people stop buying and everyone tries to sell, the bubble burst.

[Janebondage 2177]

 

It’s interesting, Art and intellectual property taking on all new forms. 
As for me I am still working  to figure out how to transfer data with iTunes. So …..🤯

[clearbluesky15 1936]

On 4/28/2022 at 3:25 PM, Greenteal said:

 Tangible or not, a market needs a certain amount of transactions to stay viable. When people stop buying and everyone tries to sell, the bubble burst.

I agree completely. The only reason I brought up tangibility is at least in the case of physical art one can console one's self that one gets to retain it regardless of what the artist or middlemen do. I have paintings for example, that I do not own the copyright for, and may or not have the resale value of what I paid... but I like to look at them and can put them where I want, or I can sell them and I don't have to get permission of the artist.

With an NFT, one owns an official "receipt" on a blockchain that points to a textfile that points to a location with  contents. Terms and conditions vary on the platform (often done with 'click through', and there is no guarantee the platform (e.g. NBA hotshots, or Bored Ape Yacht Club) will stay running... so the rug can get pulled out from under you... then you have nothing, and no recourse, since NFTs rarely confer copyright. In some cases, the works can not likely be copyrighted (computer-generated art for example).

At least having my art and comics... I get to keep the art/comics 🙂 even if I don't own the copyright.

 

Again agreed that bubbles can form around any perception of value (your point)... regardless of basis / market... sometimes even when the bubble bursts... its nice to have something left over (the thing itself). That latter piece is my addition.

 

[Greenteal 41578]

1 hour ago, clearbluesky15 said:

I agree completely. The only reason I brought up tangibility is at least in the case of physical art one can console one's self that one gets to retain it regardless of what the artist or middlemen do. I have paintings for example, that I do not own the copyright for, and may or not have the resale value of what I paid... but I really like to look at them and can put them where I want, or I can sell them and I don't have to get permission of the artist.

   To be clear, I'm not against the concept. If done with discipline as a form of virtual collection and not intended as investments, I can see the appeal.

   But for people getting into this, the pressure of influencers disguised as financial advisers can push them in expensive mistakes and unrealistic expectations.

    Many got into collecting after seeing shows like "Storage Wars", "Pawn Stars" and "Antiques Roadshow" without understanding the theatrics and administrative costs associated with appraisals and auctions.

    NFT's are a different market, but can also create misleading expectations. Better make it a hobby, than a retirement plan.