NFT always felt ridiculous to me, but I though I understood the mechanism: "it's like baseball cards but in the blockchain".
This week I learned it's not.
NFT are Non Fungible Tokens, which means tokens that can't be divided, unlike crypto currencies like Bitcoin that can be divided in Satoshis. So you exchange the totality of it, or not. Basically it's a unique number in the blockchain you change ownership by applying cryptographic signatures during a transaction. Most of the time it's an ethereum smart contract address + a token id.
But wait, where are the pics ? The gifs ? The videos ?
I mean, opensea.io does allow you to mint (the term for magically turning a media into an official NFT backed by the blockchain) up to 100MB of content.
So where is it? Not in the blockchain, obviously, it's already fat enough with tiny transaction data.
Well, it's just stored in the centralized platforms like opensea, rarible, etc.
Basically, the NFT is not even that piece of art, baseball card or whatever, it's just the number linked to the proprietary, centralized, privately own trading platform that hosts the content.
The platform disappears, or bans you, or changes policy, or is blocked, or whatever, and your NFT is back to being a bare-bone blockchain contract number and a token id.
It's even more bullshit that I though! You don't even have control on whatever you make believe to virtually own. It's madness.
But you know what, the week I spent in this weird universe was also so much fun. There is an atmosphere of creative WTF, a mix of scams, community bonding, money laundering and genuine experimentation all bathed in some frenetic craziness that reminds me of the early days of the internet.
Non-fungible doesn't mean something can't be divided, it means a specific one just can't be substituted for another one.
An example: If I trade oil, one barrel of oil with a certain spec[1] is fungible with another barrel of oil with the same spec. If I sell you some oil you don't care which specific barrel you get as long as it's the same kind of thing. Likewise if you borrow 10 dollars from me you can pay me back with any combination of notes up to the value of 10 dollars, you don't have to give me back the specific bills I gave you.
On the other hand, things like art are not fungible. If I loan a Van Gogh to a gallery I very much want the same piece to be sent back to me after the exhibition is done. It's not ok for them to send me something else. Even if it's "sunflowers" (since Van Gogh painted a few of those and they are quite similar), I want the actual one I loaned to be sent back to me.
Normal bitcoins or ETH are fungible whereas NFTs are non-fungible. The specific one you have matters usually because it represents a digital proof of ownership of some specific resource (a bored ape or whatever).
[1] The spec for oil types standardises particular grades and then people trade a standard barrel size (called a bbl which is short for "blue barrel" because they used to be painted blue). "Brent" and "WTI" are different grades. A barrel of brent is fungible with another barrel of brent but not with a barrel of WTI because that's a different grade.
This answer confused me at first, because I initially thought you were trying to say non-fungible assets can be divided. At least in the case of non-fungible Ethereum tokens, it's the case that they both each can't be substituted for another one and they can't be divided, right?
And in the case of ERC-1155 semi-fungible tokens (SFTs), you can substitute them for others of the same type but they still each can't be divided. They're whole, irreducible units.
For both NFTs and SFTs, I think the non-divisibility is an important component to understanding what they are. There's no "smaller denomination" of each asset in the way that Ethereum can be divided arbitrarily until you reach the minimum "wei" unit.
You're right that non-divisibility isn't a sufficient condition to be non-fungible (as with SFTs), but the way I interpreted your first sentence made it seem like it was an orthogonal condition rather than a necessary and central one. (At least for cryptocurrency assets.)
Just one thing - you can always write a separate contract which subdivides an otherwise indivisible asset on the blockchain.
For example, with NFTs, you could make a DAO that pools together capital to purchase an NFT and can trade their share of ownership of the NFT on the open market.
Divisability is often related to fungibility in that the ability to divide a resource is a way to create fungibility (e.g. the sea of oil is split into barrels)
Oh do I have a scam for you! So, no, obviously you can't divide an NFT, but what you can do is create a new fungible token (or smart contract not sure about the exact details) that represents partial ownership of the NFT. So you can issue 1000 of these fungible tokens that represent partial ownership of the NFT.
The whole thing feels like some kind of postmodernist performance art about property and ownership.
Actually, come to think of it, maybe that's a great idea. If people ask questions about NFTs, they might start asking more questions about intellectual property as well, and ultimately about property rights in general. In a sense, NFT is the ultimate absentee property - it's impossible to use or occupy. It's a title to itself.
I'm slightly afraid of the asking because of what answers parties might arrive to.
Someone pushing for intellectual property maximalism might see in NFTs a technical counterpart to the legal monopoly on the ownership of digital information. Why not encode the ownership of a copy of the newest game as a NFT, and then have the console check at startup? And similarlines of thought that I don't have the imagination to consider.
I mean, that's basically just DRM, and we already have it - the blockchain adds nothing to the picture.
Well, such validation would continue working for as long as the blockchain on which the tokens are checked is still running, as opposed to when the manufacturer takes down their DRM servers. But that's added convenience to the user; the manufacturer actually loses a degree of control, so I don't see why they'd go for it?
> Imagine writing the investment memo for “20% of a picture of a dog” and being like “the most we should pay is probably about $2 million because the whole picture of the dog sold for $4 million three months ago and it can’t realistically have appreciated more than 150% since then; even if the whole picture of the dog is worth, aggressively, $10 million, this share would be worth $2 milllion.”
> One model here is that everyone on earth wants to pay $4 million for a unique picture of a dog, so if you make one unique picture of a dog and sell it for $4 million you’ll get $4 million but if you cut it into 17 billion slices each one will sell for $4 million?
Fungible doesn't mean divisable. That does not imply non-fungible means something is divisable. I gave an example of somithing fungible which isn't divisable (a barrel of oil) and one which is (dollars). In fact I also gave an example of something non-fungible which is non-divisable (Van Gogh's Sunflowers).
I'm struggling to think of something non-fungible which is divisable, but in any case I'm pretty sure NFTs are not divisable. It might be the case that non-fungible implies non-divisable but fungible things can be divisable or not.
"...which says you believe you own this receipt, and at the time of purchase, you believed that the issuer of this receipt believes in your ownership of it too".
So I do wonder whether the NFT divide (between people who get it and people who don’t) might be a generational split, related to a larger societal shift away from ‘owning things’. We’ve definitely passed ‘peak thing ownership’.
For those of us old enough to have grown up with the idea of ‘buying a book’, ‘buying a toy’, ‘buying a CD’ or ‘buying a magazine’ we have a particular mental framework for ‘owning’ stuff.
But people stopped buying those things a while ago (people stopped buying toys? Not completely, but certainly some of that spend now goes on apps right?).
So for people who have grown up in a digital-subscription world, they might just have a fundamentally different mental model of ownership - one which is more compatible with NFTs as a reasonable idea than the paradigm us old ‘thing owners’ have.
Like, consider some of the things you likely have bought recently: a ‘twelve month Netflix subscription’, a ‘Steam library game’, an ‘app’… you bought those things with no expectation you could resell them later because you don’t think of those as ‘things’. And because you haven’t yet adjusted your mental model to the reality that this is what you spend your wealth on now - ephemeral digital rights you won’t be able to pass on to your kids when you’re gone.
But if you grew up digital native and the only things you’ve ever been able to buy are non transferable digital pointers to rights to use something, maybe the idea of a transferable digital rights pointer seems like a crazy innovative new idea that changes everything?
The difference between most[1] NFTs and Netflix/Steam/Apps is with the latter, you are buying access to something. With most of these NFTs that are just a picture, owning the NFT doesn't confer any special right to you. We can all enjoy the Disaster Girl meme, you don't have to have bought the NFT. The owner of the first ever tweet cannot actually do anything with it, edit it, destroy it, put it in a private collection so only they can look at it.
The only thing buying one of these NFTs gives you is I guess "bragging rights" but I think it remains to be seen why anyone should care that you paid money for 0x3B3ee1931Dc30C1957379FAc9aba94D1C48a5405,25046.
[1] The only exception is maybe these NFTs that interact with something on the blockchain like an item or place in a videogame, in that case owning the NFT provides some sort of utility.
Yes, that's definitely the case for a lot of NFTs being minted and sold.
And if an NFT did represent the right to download and play a particular game from Steam (like, you had to present proof of ownership of an NFT to Steam to be allowed to play the game), such that I could sell that NFT outside of Steam to someone else... well, the value of that NFT is only as good as Steam's willingness to abide by the agreement it embodies, which they can unilaterally withdraw at any time, so there's little value in Steam honoring such a thing. If they wanted to permit game resale, they can do that, inside their own database, without any NFT nonsense.
So yeah, it's still a bit of a mystery if or whether this actually adds anything, but I'm just trying to put myself into the mindset of people who are excited by this and trying to figure out what excites them, rather than just assuming they're all dumb because they think buying numbers is going to change the world.
It really shows the dishonesty in crypto "innovation:" they claim "security" and "trustlessness," but it all reduces to simple human/institutional/contractual trust relationships as soon as you need to deal with anything with real-world practical value, whether that be access to games on Steam or tracking a package or whatever.
With all this fancy software and energy spent on mining, what then is the point of all that effort?
I think some of that directly connects to the (intentional) confusion in terms of "smart contracts" and old fashioned "contracts". "Smart contracts" are programs and there's a sense that they are "better" and easier to "trust" than old fashioned "contracts" because computer's enforce them ("fairly and equitably", or so proponents believe [1]) and not people and institutions.
But people don't run "smart contract software" in their own brains and at the end of the day if these things are to be meaningful to people they have to interact with people and institutions and good old fashioned "contracts". It's trying to solve sociological and political problems with code, but we don't have a real world substrate for those "programs", what we instead have millennia of institutional history and contract law and at the end of the day those still matter more than what the computer says even you personally don't trust those institutions for whatever reason.
ETA: [1] Don't forget that it's a common fallacy among tech idealists that computers are unbiased and objective "because math" rather than machines that will reflect the biases and subjective opinions of those that program them.
Yeah I agree, and that's why I'm generally skeptical of any smart contract ideas that have to interface with real life (supply chains, land registry, and so on). I think they make more sense when they are concerned with things entirely contained within the blockchain, like swapping tokens or mapping names to addresses. Frustratingly enough, it's the former type ("let's put cows on the blockchain") that seem to get the most mainstream attention.
I've passed beyond skeptical of smart contracts that try to apply to real life to a concern that much more real contract law needs to apply to smart contracts.
Ethereum is already full of fun stories where "smart" contracts did extremely dumb things because they took a programmer's word extremely literally rather than a programmer's intent.
In a world where programmers are assumed to be ordinary, fallible humans that's a ton of pressure to put on a programmer to never make a single mistake. While there's a lot of active research into trying to bring technical solutions to that human problem such as strict "formal proofs" and such of the programs being made into smart contracts, I'm increasingly of the opinion that would benefit them the most would be political and sociological solutions such as classics like "courts of appeals", "trials by jury of peers" to determine intent over literal substance, and so forth.
Those aren't "fun, technical" solutions, and would require placing trust again in institutions and people, so I absolutely have zero optimism that any smart contracts system would embrace them. I just think that they need such political structures to exist otherwise you left with merely a lowest common denominator tyranny of software bugs (no matter how formally the best contracts mathematically prove their claims/efforts).
Using a court of appeals assumes a shared widespread understanding of the topic of disagreement, often the only people with the expertise on the topic are going to be the parties involved and teaching a 3rd party can be impractical and prone to steering.
I can see smart contracts working with very low volume specialized scenarios for this reason.
Also traditional dispute resolution is expensive plenty of times where both parties would be willing to accept the risk of a bug over paying lawyer fees
The shape of trials in a court of law is built around discovering the topic of disagreement and sourcing enough expertise on the topic to get a judgement from a jury of "peers".
Whether or not that is an expensive process is orthogonal to the question: if a "smart" contract makes a mistake, how do you fix it? Right now there is just zero recourse and everybody shrugs their shoulders at it, "oh well, that's just how software bugs work, sorry about your loss". That's an awfully hard pill to swallow for the average person. Real contracts built up a lot of mechanisms to keep contracts fair and equitable by making sure that when one goes wrong there are ways to deal with it.
Right now with "smart" contracts it's a wild west of whether or not escrow accounts exist and you can maybe, optionally get people (or institutions) involved to fixed something about to go wrong or in the process of going wrong, and there's just about no way in most "smart" contracts to fix things after they've gone wrong. But critically it's a "right" in most contract law-based countries to challenge a contract in a court of law and get a human opinion from a jury of your peers, and I don't see how average citizens can trust a system where that "right" is not given as such and is an "optional" feature that they generally have no idea exists in a specific "smart" contract code (much less if that feature itself is buggy or not).
I realize (per above) that this is often a "feature" and not a "bug" in "smart" contract design today. Most of the designers don't trust institutions (and maybe not even people) and like the "freedom" of "smart" contract platforms with few regulations, few "required features", and few places for instutional/personal intercession. I just don't think that's a good situation for most people to ever trust "smart" contracts in the real world.
Pretty much every profile pic NFT now (hottest form of NFTs right now) comes with some huge list of utility and roadmap behind it (look into BAYC for a good example), if that's the sort of thing you're looking for. Also, "bragging rights" or flexing, it turns out, is a pretty huge part of not only the physical realm but also digital as well if you look at the existing digital skins market.
Skins are an interesting comparison. I feel like that falls under the utility category I mentioned, like when you buy a skin you are really buying the right to use something at a particular place and time (a cool looking gun during a match), and nobody else has the right to use it. In contrast, whenever I see the Disaster Girl meme posted somewhere on the Internet I don't see any indication of who "owns" it.
It has an owner. Its copyright belongs to the photographer who took it - Dave Roth, father of Zoë Roth, the girl in the picture. If you ever see it reproduced in a newspaper article you’ll see him credited.
The NFT Zoë Roth sold doesn’t convey any rights over that image or its use. It’s got the faint frisson of exclusivity to it - kind of like if you had a print of that photograph signed by Zoë Roth. It’s a little bit special that it’s an NFT minted by her in specific reference to the meme; and it has some additional cachet as a historical artifact of being maybe one of the first meme NFTs, so there’s that.
So sure, I can sort of see there being some value in the bragging rights of being able to say “look, I have the private key to the ethereum wallet that has the right to transfer ownership of this binary string to someone else, and look - this cryptographically secure chain of numbers shows that that very same binary string is the one Zoë Roth cryptographically signed with her own private key way back in 2021…”
Just, that’s going to be a lot to explain, for the bragging rights, I think.
Compared to pointing to a picture in a frame and saying “yeah, that’s signed by the person in the picture”.
> It has an owner. Its copyright belongs to the photographer who took it - Dave Roth, father of Zoë Roth, the girl in the picture. If you ever see it reproduced in a newspaper article you’ll see him credited.
Note that we casually may call him the owner, but having certain legal claims such as copyright is not the same thing as the legal concept of ownership.
This is relevant, because pointing to a picture on the wall saying "yeah, that is an original Disaster Girl print" is a very different social flex than saying "I am the artist of this well-known photograph". The latter doesn't really need nor benefit from an authenticated digital print on the creators wall; of course the artist can print dozens of copies and they are all authenticated.
For Dave Roth to sell the the copyright or certain license rights to the image is just such an entirely different transaction that I am not sure why NFT critics keep mixing them up.
Those are good points. The comparison to an autographed photo is actually really fair and puts it in a different light for me. But half a million bucks for an autograph from the girl in that meme? It still sets off my BS detector but I'm open to the possibility that I just don't get it.
Not really, because there is still no utility in owning the rights to an NFT.
I've only ever seen two kinds of interest expressed in NFTs.
The first is immensely wealthy people who are looking for a trendy way to flaunt their wealth, because they've exhausted all traditional options. This is what leads someone to pay $3M to "own" the first tweet.
The second is people who aren't immensely wealthy but are hoping they will become so by buying/minting an NFT and selling it for an huge profit, presumably to someone from the first group (or a sucker from the second). This makes up the majority of NFTs by volume, and is where the pyramid scheme similarities become hard to dismiss.
Haven't seen anything resembling a third kind of interest that, under scrutiny, doesn't ultimately fall into one of these two groups.
It seems to be exactly the opposite. In digital age you can consume stuff without buying anything and people care less about ownership per se, but "people who don't get it" buy stuff like NFT.
Maybe. Or maybe it's that people less used to the concept of ownership can be more easily defrauded by "as a Service" businesses and people peddling crypto alike.
> consider some of the things you likely have bought recently: a ‘twelve month Netflix subscription’, a ‘Steam library game’, an ‘app’… you bought those things with no expectation you could resell them later because you don’t think of those as ‘things’
Yes and no. The subscription is very much "a thing". Think of this like a mental jump you've made when you understood functions as first-class values - code that your program can grab and pass around. I may not be able to sell the underlying media library to which I'm granted access, but I can very much sell the access itself. Or borrow it to a friend. Or charge money for it. People are[0], in fact, trading access to subscription services like Netflix.
> if you grew up digital native and the only things you’ve ever been able to buy are non transferable digital pointers to rights to use something, maybe the idea of a transferable digital rights pointer seems like a crazy innovative new idea that changes everything?
That's... a couple decades of dystopia ahead of us. People growing today are still buying food, toys, medicine. Children develop understanding of ownership before they develop understanding of money.
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[0] - Or were, last time I checked, which was some 2-3 years ago.
NFTs are all about owning, in fact they are more about owning than almost anything on earth. The ONLY advantage you get from owning an NFT is the knowledge that you own it. Everyone, owner or not, can enjoy looking at the jpeg in the same way. That's not really true for anything else.
So, far from representing the move away from ownership, they are a distillation of the ownership concept.
I do, in fact, expect to be able to use my paid for Android app at any time in the future.
I'm not counting on updates and new features, I just want the same version I bought to work on the same version of Android it works on right now.
Obviously, that's all in my stubborn old school brain, but it doesn't stop me from hoarding .APK files and Android images.
I had a lot of great very old software on some CDs that I regularly reburned/copied until I lost them over a decade ago and I'm still pissed about that :D
> I mean, opensea.io does allow you to mint (the term for magically turning a media into an official NFT backed by the blockchain) up to 100MB of content.
So where is it? Not in the blockchain, obviously, it's already fat enough with tiny transaction data.
Well, it's just stored in the centralized platforms like opensea, rarible, etc.
You’re right that this is the way many have been created so far, but that will not be the case for long. Already people have pointed NFTs to IPFS/Filecoin which will give them much more staying power. And this can be done without using a centralized platform like opensea, check out nft.storage and metaplex (1) as starting points.
Agreed, and I hope it will become more popular. But right now, since you can't browse IFPS with firefox or chrome, and manual minting is harder than clicking a button on open sea, I wager private platforms will keep their appeal.
Maybe when decentralized service will do all the decentralized hard work for you, take your metamask, upload your content on IFPS, mint it, then let you sell it, it will take on.
I think the key here is that we've already as a society given up a lot of our ownership for the sake of convenience. Most people buy their phones through a mobile carrier, locking them in through the life of their contract. I'm not totally sure about how Google accounts work, but I'd wager that getting your Google drive data back if you're banned is difficult. Kids these days are even purchasing skins for video games with the full knowledge that if they get banned, all of those skins will be gone.
A lot of what we own these days is not "owned" in the traditional sense. Opensea is no different from purchasing a video game that you could be banned from in that both purchase prices aren't ownership, but rather a price to access a product.
Actually this is quickly becoming the standard. Once you mint an NFT on opensea, you have the option to "freeze" the metadata, which transfers the image and everything else to IPFS storage.
Don’t those still rely on the gateway for wherever you mint it on IPFS staying up? The NFT link only points to a gateway which can go down then you’re at the mercy of it being replicated across nodes right?
Correct, it still only exists as long as someone on the IPFS network wants to keep it up. Similar to bittorrent in that way. Still, in the long-term, it seems that having the actual image/video/audio/other data replicated on a decentralized network rather than hosted on a single domain makes more sense to me (but then again, I'm very bullish on the future of IPFS/Filecoin).
It'll be interesting to see because if someone is the only one to pin/replicate the IPFS object an NFT points to it seems like they have some leverage over NFT owners. Is there any way to validate the file without the ipfs object? That's one weakness I've seen pointed out in the NFT idea (beyond the obvious objections about the energy use for what looks a lot like tulips and speculation).
If you scroll down you’ll see that the assets can be hosted on decentralised networks too like IPFS.
Also, not all NFT projects are built the same. I suggest you check out Pak’s Poets project - it’s a very exciting piece of performance art built around game theory.
Disclaimer: I don’t own any NFTs but that doesn’t mean I’m not excited by what they’re doing.
Oh, I would never have believed it. Thanks for the info. Most people that I know don't even know what IPFS is. Are those human uploaded, or bot uploaded?
> the art is the token
Yes, but why isn't the token displayed in the centered of the page on most popular platforms?
Because human needs a symbol that represent that token.
For most people, the animation and the number are the same. NFT work because people share a believe about them, after all.
And all the strong believe in humanity are sustained using symbols.
There are certainly a chunk of NFTs that the media only exists on one centralized server somewhere. Someone forgets to pay the bill and poof there goes your art. You can download the image but the contract's `tokenUri` function still points to that old location.
Then the next tier up would store their media on IPFS, if you purchase the NFT you're expected to be responsible for pinning that IPFS content somewhere. That's not communicated too well though. The benefit there is if the original minter stops paying for IPFS hosting but you still have yours pinned, it's still available. I think most of the "Mint as a service" platforms will use IPFS by default.
Then there are projects that are storing the images entirely on chain. These are obviously more costly to create but don't require another service/protocol/platform.
Anyone who buys these things is getting scammed and I feel sorry for them. I have friends who regularly fall for MLMs and other scams like this, and they never seem to learn. Is there any way to get through to them?
As stupid as it is, what you describe IS exactly "baseball cards in the blockchain", because each individual card/nft can only be owned by one person at a time.
The difference with baseball cards (apart from not being physical) is that most nft projects are combinatorial, so they make 10000 different cards, constructed from combinations of a much smaller number of "traits". That way the artist only has to draw say 25 faces, 20 hats, 20 eye glasses etc.
With baseball cards you'd instead make 100 different cards, and then print 1000s of copies of each. You could do that with NFTs, but you don't. The reason for that is probably that you can't sell NFTs in sealed packages where 95% of the cards will be uninteresting. I guess you could, but again you don't.
Many of the early ISPs played shell games with ad companies. NetZero is one of the most famously documented of the 90s dot-com age promising "free internet" with ads/MLM schemes, but they were one of the pack. The few I can recall today to google on the Bings, including NetZero, surprisingly still exist and survived the dot-com implosion as more traditional ISPs, but NetZero is the most useful example to give as it still bears the scars of its early scam-like history its own brand name. I don't think they've offered actual "zero dollar" service in more than a decade, but that's where their name originated.
I recall so many fly-by-night ads and ads+MLM schemes in the early internet, a lot of which I watched in Slashdot takedowns and teardowns at the time.
The early days of online payments (paypal) maybe. Unless they're talking about usenet selling, in which case I don't remember it being 'thrilling' to get a money order in the mail.
I kinda hate NFTs: But, the analogy to a "certificate of authenticity" for "real pieces of art" or "memorabilia" is reasonable. It's not "actually the art".
the "centralized platform" blocking you is kind of immaterial. The point is that other people can see that the token matches. Though one difference from CoAs is that the "centralized platform" could remove the art. I don't know how opensea works, but one could in theory hash the digital content, drop it onto bittorrent (or whatever, use the bittorrent hash id) and lock that up with the token. Is that how opensea works?
I'm still trying to wrap my head around the NFT thing (I get the base concept, and I know originally it was thought of for digital ownership of home deeds, etc, which makes perfect sense to me, but everything that I'm seeing from it lately just seems like beanie baby collecting, like art and avatars and buying with the sole expectation of selling to a bigger sucker later).
Where are you going to immerse yourself into this universe and seeing the community and experimentation? I don't know where I'd even start with that.
I have a lot of crypto nerds as friends, they have a trading platform, and so they are on all the reddit/discord/telegram important channels.
I wouldn't know where to begin, because I just got dunked into it a few days ago when one my friends asked my help to code a platform to create vanity user pages. I had nothing to do, it came to me :)
Gotcha. I've been into cryptocurrencies for a long time, but I've been feeling like a bit of a luddite when it comes to NFTs, or like most people who call crypto a ponzi scheme (some coins pretty much are, but not all), and that probably means I'm missing something.
I know where to go to find good information about crypto, but not NFTs.
Your second last paragraph perfectly summed up my feeling about it. :p I don't want to touch it at first, since its scam/money laundering smell is very strong(and also environment impact) also I think overall thing is pretty stupid.
But after some time that I,um, "participate" in it, I can feel the lots of weird creative energy flowing in there, collectively. Not a thing we see often in today's world. It's quite rejuvenating, and crazy.
While you are right that the NFT is just an entry to the blockchain with a URI to the actual media file, the file is NOT stored on a centralized platform.
While it is possible to use a regular server to store the media file, it is certainly very bad practice and defeats the whole point of NFTs.
The media files are stored on IPFS, which is a decentralized peer-to-peer storage network. This ensures that the media file that a NFT represents, will always be available, since it is hosted by many people on the network.
> This ensures that the media file that a NFT represents, will always be available, since it is hosted by many people on the network.
I’m pretty sure this is incorrect. IPFS is not permanent storage unless you host the content yourself or pay a pining service to host it. It may be cached on many computers but those caches are finite and get cleared.
> The platform disappears, or bans you, or changes policy, or is blocked, or whatever, and your NFT is back to being a bare-bone blockchain contract number and a token id.
So what? You can obviously right click to save the JPEG, so if the platform goes down it doesn't really matter. What you're buying is ownership of the NFT of the JPEG, not the JPEG. Even if the platform goes down, you'll still be able to see the name of the piece in the metadata.
NFT's doesn't prove anything though. The art world care a lot about originals, but an NFT cannot prove that something is an original. Nothing would prevent the author from just issuing a lot of NFT's pointing to a lot of copies of the same art piece. They are even worse than that, NFT doesn't even represent the piece of art, if the service it is connected to goes down then the NFT points to nothing, you can't even prove that it at one time pointed to a specific image.
Lastly, there is no reason for a service provider to issue NFT's. Service providers earns a ton from taxing the market when people trade items, there is no reason for them to give this away by issuing NFT's. Rather every service I've seen issue NFT's did it to sell items that will never be valuable, but that NFT enthusiasts now think will be valuable thanks to the NFT.
Anyway, best case NFT's are just an untaxed market associated with a game or service content. That is the absolutely best case, in what way does that sound novel?
Edit: The untaxed part probably means that governments will shut it down if it becomes too popular. So even less reasons to invest.
>Nothing would prevent the author from just issuing a lot of NFT's pointing to a lot of copies of the same art piece
Nothing prevents an author from just issuing a lot of duplicate art and claiming they are the original copy.
Except it's fraud and people would likely figure it out over time. That's the exact same scenario as the blockchain except it's even harder for the artist to cheat as everyone can see the blockchain so when the artist makes copies and tries to sell them then everyone can easily see that they are frauds.
>you can't even prove that it at one time pointed to a specific image
Most NFTs use IPFS which uses hashes to uniquely identify files and even if the file disappears from the internet it can be recovered by anyone who still has the original file and be back online.
This week I learned it's not.
NFT are Non Fungible Tokens, which means tokens that can't be divided, unlike crypto currencies like Bitcoin that can be divided in Satoshis. So you exchange the totality of it, or not. Basically it's a unique number in the blockchain you change ownership by applying cryptographic signatures during a transaction. Most of the time it's an ethereum smart contract address + a token id.
But wait, where are the pics ? The gifs ? The videos ?
I mean, opensea.io does allow you to mint (the term for magically turning a media into an official NFT backed by the blockchain) up to 100MB of content.
So where is it? Not in the blockchain, obviously, it's already fat enough with tiny transaction data.
Well, it's just stored in the centralized platforms like opensea, rarible, etc.
Basically, the NFT is not even that piece of art, baseball card or whatever, it's just the number linked to the proprietary, centralized, privately own trading platform that hosts the content.
The platform disappears, or bans you, or changes policy, or is blocked, or whatever, and your NFT is back to being a bare-bone blockchain contract number and a token id.
It's even more bullshit that I though! You don't even have control on whatever you make believe to virtually own. It's madness.
But you know what, the week I spent in this weird universe was also so much fun. There is an atmosphere of creative WTF, a mix of scams, community bonding, money laundering and genuine experimentation all bathed in some frenetic craziness that reminds me of the early days of the internet.
Despite all that crap, I kinda like it.