fandomsecrets | [ SECRET POST #5490 ]

It has been months since this term burst onto the scene, and I'm still no closer to understanding WTF and NFT actually is. The more people explain how this message about how you own a message about something which is usually publicly available to everyone, the less sense it makes.

I've decided that NFT just means No Fucking Thanks. It is easier.

Is this one of those Crypto-currency terms?

Here's my understanding: The thing that is being owned is essentially the ID number of a bitcoin. The ID number is stored in the url of a picture (or message or whatever). The buyer, upon buying NFT, owns the bitcoin the number refers to.

...I think?

Either way, bitcoins are stupid, people who think they're actually buying the art rather than the url "token" are stupid, and anyone who thinks they're more intelligent for "understanding" crypto should learn how JC Penney credit cards work.

I don't think it's a bitcoin, it's some other kind of cryptographic token, but yeah, pretty much.

The thing that no one has ever been able to explain to me is: why should the NFT have a higher value than the underlying value of the thing that it points to? It doesn't make any sense to me so it seems like the whole thing is just pure hype and bubble.

NAYRT

From my limited understanding, the value is really only hype. It's not the inherent value of a piece (see the ugly apes thing) vs some other oiece of digital art that an artist really worked on; all that to say, it's, to a certain degree, a racket. The item has value because hype is created around it, not because it is in fact valuable in and of itself. It's a good way to launder money.

Like I'm all here for artists getting paid and what not (I'm an artist too who has a regular 9-5 lol), and there are clearly people profiting from it, but there are plenty of people with $$$ and power who are just making more. Shuffling cash around. Honestly, to me it sounds like the stock market with extra steps and abstraction. And in the end, who is deciding the value of any of these things (from the value of a particular pixelated piece to the valuation of a company -- which to some degree has tangible/intangible services/goods). And none of this is even touching the environmental nonsense that NFTs create (I haven't done much research on data mining, I'm sure that doesn't fall terribly far from that either).

Sorry for the rant.

THIS.
The value is hyped by those who beging minting (creating the algorithm attached to the media) the NFTs first and began selling them to each other to hyper inflated prices. There are a lot of stories of people passing each other's NFTs just to prove that they can sell them to a value, while in fact there is no inherent value in NFTs. It's just hyped bullshit.
The funny thing is that this practise of selling amongst a small group and thus inflating prices is written in the block chain (the "cloud" for cryptos and NFTs) so everyone has access to those datas. Everyone knows that it's money laundering and MLM schemes. It's an inflated marked full of scammers and easily scammable people who buy into the hype just to have some bragging rights on a usually awful jpeg.

Think of the more traditional art money laundering, but without the art piece itself, so there is not even the value in the material used to create the art in the first place! At least if you buy an inflated piece of art with no real artistic value, you still have something you can show as yours on your house's wall. With NFT it's just your name on the digital receipt of a stupid jpeg.

Jesus. Explaing NFTs is a nightmare. There really fucking awful and stupid. I have no faith in humanity left.

I keep thinking I don’t understand what NFTs are, but now I’m starting to suspect that I do understand what they are…and it’s really just that silly.

I hope economics professors out there are doing some interesting analysis for their students on the topic.

That's about the mood, yeah.

This is the same reason I took so long to understand them. I thought I had to be missing something other than "you pay a ton of money to be able to say with the creator's blessing that you own a thing that anyone can still look at and make copies of and essentially possess an exact copy of" and it took a YouTube video that actually said "No, you're not missing anything about that, you probably just think you are because the reality is that stupid" for me to get it.

Im waiting on an explanation of how an NFT is different/better than just owning a copyright.

With an NFT, you don't own a copyright. You own a bit of computer code that redirects to whoever does own it.

Exactly. It's more similar to a digital receipt and whoever "owns" the NFT has their ID on the receipt. They don't really own the media itself so it's not a copyright issue.
It's just bragging rights for crypto bros and an excuse for money laundering

Yep.

What I don't get is I had someone say the other day that they found it nuts that so many people had "superstitious" beliefs about NFTs causing environmental harm, when actually NFTs and crypto are a great way to shake up the financial market.

Meanwhile a couple days ago on Twitter there was a video being passed around of some rich guy bragging about his new crypto farm, where he had like hundreds of processors running together. Which presumably he could get his hands on despite the chip shortage because he was already rich. And then he could use that to make himself rich in a different way.

I am not seeing how these are actually likely to add any sort of financial benefit. The people who already have real money will be the ones who can invest in it and make more money in a virtual format, and the rest of us will still be fighting for income that mega-corporations and landlords will accept to pay the freaking bills.

I think people are just in denial and don't want to admit that financial gain is often, and in the case of NFT always, to the detriment of someone/something else. People are in search of a easy way to get rich because we live in a moment of finalcial instability and it will only get worse from now on.
As you point out, only the already rich people can afford the investment to build a crypto farm and thus become even richer. Us poor (and often digitally ignorant) people are left to eat the dust. The income inequality and inflation will become worse and worse while the crypto bros will keep telling everyone how easy it is to gain money with ugly monkey jpegs while actively contribuiting to energetic and eviromental crisis.

Have you heard about Kazakhstan? That's what crypto is ALREADY doing. With NFTs it will become even more pervasive.
I'm sick of this.

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Sorry if this starts off seeming condescending, but I don't want to assume knowledge.

Fungible:
The first thing to know is what fungibility is. Basically if one thing is identical to another. If I have two five dollar bills and you have a ten, we can trade. There's a difference, but nothing has changed. That's fungibility. I have a bucket of chicken from KFC, you have the same sized bucket from KFC, we trade. Technically the chicken in the buckets are different, but nothing has really changed.

Non-Fungible:
If something is unique. Say I have the Mona Lisa, and you have Starry Night. They may be worth the same amount of money, but they are not the same. If we trade, we have completely different experiences. These are non-fungible items. Even the prints of the Mona Lisa they sell in the gift shop is not the same as the actual Mona Lisa. Even if Leonardo had created two other Mona Lisa's that we find in the basement of the Louve, they're not THE Mona Lisa.

So, when you get to computers, everything is basically fungible. If a digital artist makes a meme, they can then send a copy to a friend, delete their original, have the friend send it back, and nothing has changed. It is as if they never deleted it in the first place. NFTs are an attempt to change that. By generating a new block in the block chain, they imbed their ownership of some digital thing to be stored in the block. They can then register selling this digital item in the block as well, so that now there is a "receipt" proving the new ownership. This also registers into the block how much a digital item is "worth". If I create a digital item and then "sell" it to myself for $100K, it will be recorded as being "worth" that amount in the block chain. I can then sell it at a "discount" for $50K, and because the block chain references that it was "sold to" me for $100K, and whoever is stupid enough to do it can buy it at the "discount".

Here's the thing: doing this will not stop anyone from just right clicking on the meme and saving it. It does not make the meme exclusive to the "owner". I, as a random netitzen don't want the "receipt" proving ownership, I just want the meme. (NFT fans would call me a "dirty right clicker").

Basically all of this is done in the HOPES that someday, their "registered digital ownership" will a) be respected and b) be worth money. It's basically investment gambling. In the meantime, resource usage in generating blocks to buy and sell these NFTs have used an ENTIRE COUNTRY'S carbon allowance. They are literally burning the planet on the off chance that one day they might get rich.

This is a perfect and easily comprehensible explaination. Thank you!

What would it mean to have their registered digital ownership "respected," especially in such a way that is worth money? It sounds like if I own the copyright to an image (whether I made the image, bought the copyright, or inherited the rights) and I sell T-shirts and posters and stuff, anyone who owns the NFT with the image attached to it can't do shit about what I do with the image and doesn't get a cut of the money.

Exactly. They think that having That. Specific. Digital. File. is special. I saw recently that an e-sports gamer was selling the skin he used in a video game as an NFT. As "his skin". It's just a digital copy, like all digital things are. Anyone can play with that skin. It's one of the set provided in the game, not something exclusive to him. They want people to acknowledge that they have a "special" one that is worth more than any other thing that is exactly like it. They're trying to make fungible things non-fungible, with no mechanism of how to enforce that.

Basically, they think that someday, having that "special" digital skin that in all ways is the same that everyone else has, will have the same value that having a physical copy of the game signed by the player would have. Something that actually is non-fungible.

Long story short and very simplified, an NFT is kinda like an electronic receipt.

If FS minted NFTs (call it series 1) and you bought #3, you'd get a receipt saying you bought position #3 of FS series 1. That position is in theory "yours." And uh... that's it! There might be an image associated with it but you don't own that image or the copyright to that image, and you can't claim or use that image as yours anywhere. The image is meaningless and just fluff decoration.

All the NFT is, is a receipt that you bought item #3 of FS series 1. Or "position #whatever of RandomThing series 123." Whatever that is. If that item or position in the series is attached to some other promise made by the minter, then that's your claim to whatever promise was made by the minters (which may or may not come to fruition, lots of these are scams that take money do not intend to fulfill whatever it is at all), but the NFT itself is just the receipt part, which cannot be duplicated (i.e. is non-fungible) but can be traded around (which is where the hype and money comes in).

Like when you go to a food court and they're like ok your order is #523 and you get a little receipt ticket that says #523-for-this-food-court. Except it's electronic, secured by the blockchain so nobody else in the world can forge your particular ticket, and sometimes there's a picture of an ugly AI-generated monkey on it. Seems straightforward enough, right?

NFT scams and scammers basically do that then hype up the value of the food court, advertise the food as way better than it really is, and artificially stuff bodies into chairs to make it look like everyone totally wants a seat, then turns around and sells you their food tickets for 100x the price cause now it's supposedly in demand. Your ticket #523 suddenly has value because people wanna get in! So you can sell your place in line (or position on the series) to someone else - hyping and reselling then cashing out before the crash is more or less how most NFT-bros make money (or lose it, if they don't jump ship fast enough).

Then when everyone realizes wait, this whole thing is kinda shit, the food is bad and nobody in the back is even cooking anything, and the price collapses, everybody leaves, and all the last ones out have got is a pile of worthless receipts that are totally promising them food that no one ever delivers, most of the time.

The receipts, however, are still doing their job! They're proving (non-fungibly!) that someone or something bought a position for something. But whether that position has value or not, or will continue to have value or not, is not anything inherent to the NFT itself.

Boomer-era NFTs: name a star, buy a plot on Mars, deviantart adoptables where only one lucky buyer gets to "own" the rainbow sparkledog in series #478576 out of #597689896 by one out of a billion artists...

There are some supposedly legit use cases of NFTs, e.g. Axie Infinity that uses NFTs as IDs linked to unique monsters in their game, but what gives those NFTs value is that they link to and can be used in an actual existing game, not the NFT itself. If the game were to close down, all you've got left is the token that once represented a monster. And going back to the Deviantart sparkledog, maybe "owning" that adoptable once let you participate in RP or contests or games as that sparkledog. But the value was in what you could do and access with the certificate (or what you could trade it for), not in the certificate itself, and the artist would still hold copyright and ownership of the actual artwork.

Final note: NFTs and crypto are not the same thing and technically aren't even directly related! Lots of NFTs are bought with crypto, and both are on and make use of the blockchain, but crypto is a currency and NFTs are well, receipts.

Thank you, Case! You explained it way better that my usual "bragging rights to useless digital shit".
I forget that people don't know that NFTs and cryptos are two very different things that just share the blockchain. Thanks for pointing it out!

The legit uses of the NFTs are there and as a technology the blockchain is very fastinating and full of promises, but that marked is over saturated with scammers now and I just want it all to collapse as soon as possible.

da- that was a great explanation, cheers!

They're pokemon cards in a world where anyone can make a pokemon card, but certain companies have assigned serial numbers to certain cards (all different series from each other even if the numbers overlap, and any company can do this), and you can pay to attach yourself to a certain serial number indelibly in a way that is nigh immutable. Problem is that the serial number you bought really only matters to people who care about pokemon cards serial numbers from the company you brought it from. If that company achieves world domination, you're probably in luck though!

This explaination is very cute and incredibly accurate.

I might add: if the company fail or Heaven forbid, the website attached to the NFTs goes down, there it goes your Pokémon card serial number. So good luck betting on the right Pokémon cards!

DA
And why are all the advertisers touting the availiability of a Blue eyes White Dragon?

Sorry. Misfire or something.

I got confused.

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