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When you know the technical details of what NFTs are you realise that the way most people talk about them is completely wrong!
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00:00 Intro - NFTs aren't want people say they are
01:05 Cryptocurrency explained
02:55 What non-fungible means
05:41 The Ethereum blockchain makes NFTs possible
06:55 NFTs are made on the Ethereum blockchain
07:11 NFTs as tickets for an event - a hypothetical real world use case
09:31 Buying NFTs without trust
11:17 What NFT art actually is
19:16 Maybe NFTs aren't stupid
20:50 LegalEagle tells me not to do something stupid
24:15 NFT collectables - CryptoPunks
25:05 Support digital artists by buying their NFTs
27:26 Sponsor message
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Hi
Mint the first comment as an NFT
@@sasdagreat8052 i was first
Thank you. This is probably the only video that properly explains what NFTs are without shilling anything or without nonsensical arguments. The only thing that you ignored is the energy-wasting issue of the blockchain.
I use Arch btw...
Thank you for telling us NFTs are stupid without telling us NFTs are stupid.
Yeah this video is really good at showing the absolute best case of NFTs, and making the viewer realize that that's still useless and stupid.
Overhyped might be a kinder way of putting it. They might possibly have niche uses, but at the moment they are just being used in pyramid schemes because they are the current trendy buzzword.
This is correct. Fundamentally it makes no sense outside of very specific cases and definitely not always a good thing in the consumer space. To be exact the argument is that NFT collectibles are stupid, and just speculative things. NFTs by themselves when actually given a real purpose (a core replacement for database identity entries due to the immutable nature), have specific legitimate uses that help protect the integrity of an information system. NFTs should never have been used to overhype collectibles at all.
Looks like a lot of people still didn't get the point... Go back to 07:11 where Steve gives an example of NFTs as tickets for an event, you could even use NFTs to substitute real estate registration offices
@@israelRaizer why would you though when there are cheaper / easier / more environmentally friendly alternatives that already exist? What extra benefit does it really give you?
25:06 Just one thing to note, there are other ways to support artists you like buying full resolution files of their work, becoming a patron, buying prints or merchandise and paying for commissions (which is when the artist creates an original piece at your request).
1000% this. If you want a collectable of something, there's less egregious ways to do it then to buy a spot on a scam registry.
exactly - giving them straightup business is way more valuable to them than engaging in speculative cryptocrap
These are all so much better for the artist as they won't be burdened with minting costs
All without supporting an inherently wasteful transaction service.
That brought me to a question that was never answered by anyone that i asked : where is the value for the artist or the customer if there's a third party involved in the transaction ? Not at all comparing with an authentication expert or a Reseller type of thing no, literally someone taking money from both part just to print the recipe, where is the added value compared to a comission (wich will always be my way to go, if possible in cash) ?
The best description for NFT is buying a voided copy of someone else's grocery receipt. Your receipt says "milk", but you can't exchange it for milk or use it to get milk or claim that it IS milk, you just have a piece of paper that says "milk".
... Milk
That's a very helpful and funny description -- thank you!
But carrying that example a bit further suppose there exists a matter duplicator that can create an exact duplicate of the milk just by using the transaction number on the receipt. The only thing you don't get from the duplicate is bragging rights for having the original. Without the matter duplicator (i.e., NFT), only the original purchaser can drink the milk. With digital art NFTs the matter duplicator is a simple file copy command. Was bragging rights worth $69 million? Apparently not as last I heard it has already lost 90% of its cost.
Sooner or later someone is going to scoop some poop off a sidewalk with a piece of cardboard and sell it as an NFT. (Newly Found Turd) 🤣
It isn't a voided receipt, it's the same receipt. If the grocery shop were to accept that receipt and give you a carton of milk every time you presented it, then it would have some value. Obviously no sane person is going to do that with real cartons of milk... but in the digital world, creating a copy has no cost, so someone could accept that receipt everytime, to, for example, show a photo of a carton of milk next to your name. Or some avatar image, or a hat in a game, or anything else that they have control over, and you can only access by showing that receipt. Then it's not just a voided receipt for a photo, but an actual ticket for the use of that photo on someone's service, and that can have actual value. It all depends on who is going to accept that ticket for what.
You can tell that a lot of research went into this video. This is one of the best explanations of what NFTs are, what is a blockchain, and how smart contracts work. Great job.
I tottaly agree, I haven't seen a video that has explained it as well as this one
I didn't actually think I would come out of this being convinced that NFTs are even more stupid than I thought they were...
Never thought I would be even more convinced NFT is stupid and a scam.
Kind of makes you wonder how much Steve got paid to shill this shit.
@@mattm226 I...what? This Steve? The one who just tore open NFTs and explained why they are stupid?
@@mattm226 i also wonder how are you so dense
@@mattm226 found the gullible crypto bro.
The explanation of NFTs I came up with is: Person is standing at a table, on the table are a few polaroid photos. Each photo is set inside a shoebox with no lid. "Hi, would you like to buy an NFT of this polaroid photo of Picasso's The Charnel House?" "Oh, okay. So I now own The Charnel House?" "No." "Okay, so I own the polaroid photo?" "No." "What will I own?" "You'll own a post-it note that says that _this_ shoebox is your shoebox. The shoebox will stay on this table forever. Inside this shoebox is a polaroid photo of The Charnel House." "Uh, okay. So I can take the shoebox with me?" "No, it stays here, but you can come look at it any time." "Hrm, well, I can put a lid on the shoebox, and you'll only take the lid off when I show you this post-it note, then, right?" "No, the shoebox lid is always open." "So anyone could come by and take a photo of the polaroid in the shoebox with their cameraphone?" "Yes, but they aren't supposed to do that." "Now, wait a minute, I just realized, you said only that the _shoebox_ is my shoebox. What about the polaroid photo of The Charnel House inside?" "Oh, the photo is managed by Sam over there. Sam says the polaroid won't be moved, but you just have to take Sam's word for it." "So Sam could remove the Mona Lisa polaroid and just leave nothing in the shoebox? Or replace it with a polaroid of a pile of dog poop?" "I mean, technically, yeah. But Sam said they'll leave The Charnel House polaroid there. And your post it note says that the shoebox is yours!" "But I can choose to publicly display this polaroid of The Charnel House. should I choose, right? Or sell T-shirts with a photo of the polaroid on it?" "No, The Charnel House is still under copyright, you'd need to get permission from the Picasso estate to display or sell merchandise with it on it." "But this is the only shoebox with this polaroid in it, right?" "No, I'm pretty sure Bob over there has another shoebox with a polaroid of The Charnel House in it."
Interesting explanation regardless of who thought of it.
this is true
@@AG-zv9jo well said
Well, you got some of the most important points wrong: the polaroid of The Charnel House can't be in two shoeboxes if the NFT is ERC721 (that means the token has only 1 copy). There is an another standard called ERC1155 - Multi Token standard, but that's not an NFT by definition. The second thing you got wrong is that someone can change the contents of the shoebox. The IPFS network generates a *uniqe* hash for each file it has. When you upload something to the IPFS network, it gives you a hash. If you put something else on the network, the hash would be different. So, the NFT refers to specific hash on the IPFS, contents of which can't be deleted or modified. If there's a polaroid of The Charnel House in the shoebox, that polaroid will stay there until the end of times (okay, not the end of times, rather the end of Internet)
This is 100% correct.
The comparison to trading cards is a interesting. Its true that some products do have long lasting collectible value and NFTs are in theory no different. But those collectibles first began as products people simply wanted to own, not in the hope of selling to someone else. Trading cards in the 90s had a boom driven entirely by speculation, comic books had a similar phenomenon at the same time. In both cases the market came to be dominated by people buying in the expectation of profiting by selling it later to another buyer. Both markets collapsed after a few years and settled back down to markets of consumers buying the product because they actually want it, with a smaller secondary market of trading. That's the issue with NFTs, how many people actually want an AI clipart image of a monkey, and if they do is it actually worth $500,000 to them? Or is it bought just for speculation? I mean, we all know its the latter, and then how can anyone expect that speculation to carry on forever, with the price always going up?
The comparsions to trading cards is bullshit. Its the description of a training card, but the real card is stored in a safe thats not under your control
This was well presented. It's funny that everyone uses tickets sales for an event as the one example of NFTs being useful. Indeed, they don't HAVE to be stupid. They could be the unforgeable third-party verification mechanism we need for some things. For digital art, however it's flatly ridiculous. You're buying nothing, you own nothing, except for the ability to pass the hot potato off to someone more stupid than yourself.
Unfortunately, NFTS can't be useful for anything but scamming. If you wanted to use NFTs for normal everyday commerce this would fail for two unavoidable reasons. First, In order to buy them, you need to buy into the wildly volatile ethereum market, which is by design far too volatile for normal everyday commerce. Second, the physical resources required for the transactions to enter onto the register are both far too slow and far too expensive for normal commerce items. This means they cannot be used for normal things like "buying a coffee" or "buying a ticket" because the transaction can take minutes or poentially hours under strong contention, which is too long for most commerce tasks. It also means that the act of buying itself costs more than any small value item. It also means that the resources of the market are potentially exhaustable by normal market forces or bad actors, so buying and selling becomes an unreliable act.
@@jsrodman Excellent points - with all that, I don't see it mainstreaming. Unless you had a "stablecoin" but the attempts at that I'm aware of have failed, too. It's seeming more and more like a "solution" in search of a problem Or a technology in search of a useful application
@@jdraven0890 the point isn't to work for any practical use, but just to provide a vector for crypto bros to cash out. It was always a scam, as is the larger crypto scam it supports
@@jsrodman it's certainly seeming like that. A few earnest ppl are struggling to figure out a legitimate use, while the vast majority are promoting it on the basis of FOMO.
@@jdraven0890 ask yourself. What is the purpose of a decentralized market? The obvious properrty is no oversight. If its not obvious that this means scams, then i don't know what to tell you. No amount of technology fetishism can wish away bad actors. This was built by bad actors.
As a programmer, when I saw smart contracts for the first time, I said "Oh... God. What have we done?" Do you know how easy it would be for someone to maliciously OR unintentionally create a smart contract that doesn't do what it looks like it does? A simple overlooked bug could wipe away millions, billions, or trillions of dollars in under a second. Whether you think NFTs are stupid or not, they ARE NOT a safe place to hold your money.
This is my exact problem with NFTs. Its like you put a one of a kind painting from a famous artist on your front porch. Its gonna get stolen. Whats more is they make it so that NFTs are impossible to edit. So if someone hacks into it once, nobody can fix it. So its like that painting gets stolen, you contact the police and they say the person definitely owned that painting before selling it, and there's nothing they can do.
According to Folding ideas / Dan Olsen (and the news) this does, in fact, happen. Quite often. He said something like: each smart contract bug effectively comes with a built-in bug bounty that goes to the first person who finds and figures out how to exploit the bug.
I find it funny that the popularity of Nfts and the dunning kruger effect are basically the same line. Those who think they know everything love nfts since they can't see anything going wrong. Those who actually know that "they don't know everything" dispise nfts since they know enough to see how everything will go wrong.
thats your POV, let people take risks and maybe one day it'll be safe to use and we all benefit from it
There are people researching this using formal methods and dependently types languages to embed proofs in smart contracts. This means you can prove that if your code type checks then it does what you want it to do. It unfortunately has the problem of making the smart contracts much more complicated and thus harder for non-super technical people to read.
For a system built around not needing trust, an awful lot of trust seems to be involved. Trusting marketplaces, trusting that content related to an NFT will be ported to future platforms, trust that the one minting the NFT is the one deserving credit for whatever their NFT links to... They might as well use centralized systems instead of trust; way less inefficient.
Trust and centralization are orthogonal.
These people tend to be opposed to central authorities until they need a cop (ie when someone else steals their monkeys…)
folding ideas actually talked about that in his video, too. there's nothing guaranteeing that the link that is associated with the NFT will still point to a copy of the artwork originally associated with it. someone nefarious, or a webhosting company going bankrupt or even just a bug, or whatever else may happen, could all render that nft useless in regards to authentification of art pieces. As steve said, the art piece itself isnt directly hosted on the blockchain, only linked by proxy, and there are tons of ways that link could be broken.
@@philcorrigan5641 What these people are against is central authorities having a lot of power. Cops are not a central authority but a human. The question is how independent they think. If they just follow orders and a central authority can order whatever they want bad things happen.
@@rfldss89 Actually, with IPFS there _is_ such a guarantee -- the numbers and letters in the URL are a hash of the file, so you can load that with IPFS and verify that the hash matches the file content, and you'll know you still have the original file, without needing to trust anyone. Additionally, it's hard to delete items from IPFS, and it's not hosted centrally so there's no one to go bankrupt. Everyone collectively hosting an IPFS node would need to go bankrupt, and that's just exceedingly unlikely.
I wish you had been a professor at my uni! You have a beautifully concise, easily understood explanation for the topics you discuss. Thank you for the education sir!
Wow the whole thing is so much clearer now. Thanks Steve. As far as whether NFTs are smart or dumb, they are what they are. Something is worth what someone will pay for it. If you drop $69 million on an NFT then you had better hope that someone else is willing to pay at least that much for it if you try to sell it. If the best offer you ever get is $5 then you payed $69 million for something that's only worth 5 bucks. I'm guessing some people are buying these for tax evasion or money laundering purposes, just like they do famous art works
In fact, they function identically to "high art". Which is to say they're for money laundering. Put a bunch of money into an object, claim it has that value, then have someone else buy it. Boom. Money laundered.
And this is my personal objection to NFTs as they're currently traded; you're buying what is essentially a digital certificate of authority that ties to but grants no rights over a digital file somewhere on the Net, with the expectation that you will be able to sell it in the future to someone who will pay more to buy it from you than you spent to buy it. And _they_ would be purchasing it with the expectation that, like you, they will be able to sell it in the future at a higher price to someone else, and so on, until someone who has paid some (hopefully not exorbitant) price for that NFT discovers that there's no one willing to buy it more than a tiny fraction of what the last buyer spent, so all this achieves is a chain of shuffling money to an optimist from a bigger optimist, until it collapses under its own weight.
I would have liked to see the apparent paradox regarding centralisation be discussed in the video. What I'm talking about is the fact that blockchain is inherently supposed to be a decentralised/trustless technology, but the way blockchain is actually used (at least for NFT’s), it has become centralised and does rely on trust. What if the images are taken down? The NFT doesn't mean as much now. What if OpenSea goes down? That's going to make a lot of apps stop working. Most people won't be interacting with the blockchain directly, just as people don't host their own websites on their own servers - they rely on companies to do the hard work for them. This might be more of a problem with “Web3” than NFT’s specifically, but I still think the argument stands.
I think, there is always so much hype around new technologies, that people forget KISS (Keep It Simple Stupid), you shouldn't use more complicated technologies, if you don't need to.
another big issue in this area is forks in the transaction history. already with ethereum and bitcoin there are major forks based on disputed transactions, and of course the forks with the higher value crypto are the forks that the rich people agreed with. so there is already a central authority with the ability to control the foundational aspect of a cryptocurrency, and they are accountable to no one essentially.
@@Aras14 I completely agree with you. And especially if those newer technologies hurt the planet when there's absolutely no need to use them.
Websites are just good looking front ends interacting with smart contracts, everything you can do on OpenSea you can do directly through their smart contracts as displayed when Steve used etherscan. You're always interacting directly with the blockchain, opensea just makes the user experience better. (which means that even if openseas servers crashed for good no apps would ever break because of it)
I would only ever publish NFTs like this on a permanent and immutable storage system like arDrive. Using standard URLs or even IPFS is liable to just vanish at some point when people stop paying for storage or pinning
This may be an impressively stupid question, but here it goes: if the blockchain ledger keeps a record of every transaction, doesn't it eventually get too big and unwieldy?
yeah, it slows down over time
From some quick googling, the Bitcoin Blockchain was 253gb total in April of 2020 and was created in 2009. There are ways to keep the full set of info of where everything is that were 5gbs in April of 2020. The Ethereum blockchain appears to have been designed to avoid size problems by having something called "sharding"
Yes. That's one of the technical problems that makes popular chains slow and expensive to use. Enthusiasts insist that the problem could theoretically be (partially) fixed, but the people with the power to actually fix it don't want to because they make more money this way.
A simple question, but not a stupid one. And impressively enough, one that Etherium doesn't have an answer for, for the time being.
@@kcrtxbw.4349 just wait until ethereum 2.0
9:00 and if you lose your personal key for whatever reason - you're back where you would be if you had lost your physical ticket to the event.
Nice intro to NFTs. It left me with the question - what happens if the artist forgets to pay the hosting fee to the site with the picture and the page with the art quits displaying?
Pretty much, yes. However, most NFTs are hosted on the IPFS, which works as a P2P hosting, so as long as "someone" is hosting a copy, it's still available for everyone. Right now, there are some large interests behind offering free "backup" space for NFTs on IPFS, but it would be wisest for anyone buying an NFT to also keep a copy of it, and of the target image or whatever asset, on their own IPFS client, or to pay for some redundant IPFS hosting. Something that anyone can do, but it would be mostly in the NFT's owner's interest to also do themselves.
One aspect you didn't cover, which I find particularly concerning, is that you are given no control/access to where that URL points. You may buy an NFT that points to an image on geocities, but if the owner of that server deletes the image/gets hacked/or stops paying their bills, your link will point to a 404 page, or worse. It feels more like buying a receipt to me. That receipt will have the address of the shop on it, but the shop can up and move. If the jpeg was actually on the blockchain, that would be different. Sure that would be more expensive, but at least there's something to it then other than a hope and a promise. Your initial idea of selling tickets with escrow contracts is the best actual use for blockchain tech that I've ever heard of, so I doubt we'll ever see it in action :/ I'm still firmly in the "NFTs aren't just stupid, but also irresponsible, and more often than not, a scam." camp.
I own nfts, and an NFT literally has an image attached through the blockchain. You don't have to worry about it pointing to a website. the entire image is on the blockchain. it is near impossible to screw with an nft as well, you will need to change the update authority, which only the creator of the nft has access to. As long as the update authority is intact it can't be changed, so the image will be forever the same even if the creator were to leave or abandon, you still have the nft. My projects I buy are well developed and doxed (give out their real identification), you don't have to worry about the owner changing the nft or the owner leaving the project, because they're gonna be caught with fraud if they give out their identity then go and steal money from people who buy your nft. Now I'm gonna say this also, that if someone doesn't tell you who they are, why would you even interact in their script even if it looks good and give them money in exchange for the nft. I see nfts could become big as a ticket system, authentication system, and reservation system. I also see it good for sports events, gambling, and lifestyle/merch. I'm sorry if my comment is long and confusing, that's usually how mine are, I buy nfts because they may go somewhere they may not but it's definitely a technology thats overlooked and laughed at that definitely can do some good if it gets more development and research.
NFTs are indeed neat. Not for me, KZhead advertising, but still neat.
@@slowdrifters5149 lul so you didn't watch the video. Good luck with your ummm 'investment'
In the case when the URL is an IPFS address then it can't be forged, since IPFS addresses are cryptographic hashes. The file can still be lost to time of course, but inauthentic files can't take its place without being obvious forgeries.
Expanding on the existing answer about IPFS links not being forgable, you can also host that IPFS file yourself, so you don't rely on others and others can always access it via you
The issue with the trading card analogy is that the link on the NFT can be broken at any time for any number of reasons. Yes, your line in the ledger still exists, but the content it was pointing to isn't guaranteed to last. If I buy a trading card, there isn't any risk of me pulling it out some day and having the artwork on it suddenly change to "404 not found".
It's worth recognising that storing on-chain is a technology which is emerging, and is compatible with a variety of blockchains. The situation with links now only really exists because people are really impatient and wanted to start working with the technology before it was even ready.
And as a side note, NFTs usedfor non-art like access passes and such, will 'work forever' already, as they store their information on chain inside the token metadata, regardless of the functionality of a link. But in this case it's besides the point really as that token will probably outlast it's usecase and everything else
I don’t understand why they don’t put a digital signature of the jpg on the blockchain (to be fair, for all I know maybe they do now). Then you can put the jpg anywhere, and the signature can be used to verify it’s the jpg referenced on the nft. It makes me wonder if crypto people understand crypto.
@@scaredyfish they actually do that with ipfs, it is a hash of the image and that is stored on the blockchain.
@@joeshmoe4207 It may be obvious, but I feel it's worth pointing out that the image itself cannot be reconstructed from the hash. It really is just a signature, the image is way too big to store on the blockchain. If the image URL goes away, the hash won't help.
The better analogy with Patrick Stewards picture would be that he'd put a stamp on a separate piece of paper that says "I approve that Steve Mould has printed a picture of me". That's much less unique than a signature on the picture itself.
I've just watched the legal eagle video and yours, and I have to say, excellent collab. I feel like you sat down with some creators and split up the subjects, which is awesome. So much better than all those "there's another creator in my vid here". thank you and props!
I was arguing with my friends for a long time that NFTs is the dumbest idea I've known that people believe in. Now that I know this video exists, I'll just point them here.
Show them the folding ideas video as well, for a deeper look!
the technology itself is not dumb, its interesting, and may have some potential uses in the future. the problem is that PEOPLE are dumb, and they like to turn everything cool into a way to make easy money. right now NFTs don't really fix any problem that makes it worth the trouble, at most it give marginal advantages in niche cases. but as long as it has such a huge carbon footprint, is EXTREMELY unsafe, and is just a tool for people to play with a unregulated speculative market, it won't be any good.
Mint an NFT pointing to this video and sell it to them
Forget NFTs, I wanna sell people my farts for 100k each. They are all unique and one of a kind.
@@danilooliveira6580 Not sure about the carbon footprint remark, but otherwise completely spot on. Any new technology goes through a period of novelty, or even hyper-novelty, where we really aren't sure what the thing is or how it should be used. Electricity, automobiles, computers, nuclear fission. NFTs and block chain are no different in that it'll just take time to work out what the actual utility of it all is.
Given how big the current market is for autographs and collectibles, I'm pretty sure this is mostly a bubble. Some will survive, but people will want physical objects and stuff that actually feels nice to "own" rather than something they think someone else will buy thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else thinking they can sell it to someone else
on the contrary, for the very reason you gave, the shear size of the collectables market, NFT collectables will retain a market among people who find fulfillment in collecting NFTs. just as they do staps, coins, or unusually shaped chips. ther eis no accounting for taste, and soemone somewhere will find value in owning nearly anything. the really interesting application is in things like digital assets, game components and stuff. i deal with a lot of on choin games that use NFTs as a stand in for cards for variosonline card like playing games. things like fortnight skins could be NFTs as easily as anything else. but even more useful is to start using NFTs as steve envisioned, as access tokens for any number of things, concert tickets, gym memberships, security passes. the list is litteraly endless. NFT artwork is just the first wisespread usecase. as people get past the novelty of the idea and it gains traction i expect the market to crash (its certainally a bubble) but it will always retain some value, likley a lot, but NFT use cases will explode.
It's Bored Apes all the way down
@@jondepinet Beanie Babies. I think it will still exist, but I doubt they will retain anywhere close to the current prices.
Solid idea.. its just i only see people selling stupid images they call "art".. which lack the value of the art itself (just like how stupid modern art is)
@@jondepinet The problem is, using NFTs as access tokens is about equally dumb because we could do that that way easier and way more secure by just storing a list of who has access to something on some sort of central server. As we've seen these last few days, the blockchain is very easy to exploit if you can find a way to give yourself a supermajority. I guess that's not so much a problem as a feature. The same thing as why we're all shipping food grown next to us abroad even though we're eating some other country's version of it. someone makes money off of the convolution.
I finally have a basic understanding of the whole cryptocurrency and NFT brouhaha now. Thank you so much for breaking it down so anyone can understand. Especially important for consultants such as myself when questions from clients such as this topic arise :)
Simply the best and most accurate explain of the subject matter. Well done!
So when you buy an NFT, you are buying nothing. Got it.
Not true, you're buying bragging rights to a receipt that no one will care to ask you for!
@@Waffle4569 Of course, I did'nt think of the obvious.
@@Dave-rd6sp Yes, I forgot about that bit, fair enough. However, if someone pays any amount for a picture or a piece of music that anyone can see/listen to then it's pointless. Who the hell wastes millions on that ? (they deserve to loose all their money.)
And when you put your money in a bank, it is now nothing
@@frankowalker4662 I can go to the internet and download games without paying for them. Does that mean games are pointless? Of course not. I agree NFTs are so far bad and have no use in the real world yet, but your comparison is not that great. And don't pirate games, a lot have heart and love put into them and are real works of art, paying a bit to enjoy is the minimum!
When you brought up "You can't refuse someone sending cryptocurrency to you", I thought you'd eventually bring up the malicious smart contract NFTs that can get sent to you with no control, and if you delete them, they steal all the stuff in your wallet.
Nothing is being "sent" to you. Its like saying that Chuck E Cheese is "sending" you tokens when they put a number next to your name in their database. Its their own ledger and nothing prevents them from doing that on excel or even a napkin. What you are saying is you should be able to show up and demand they change your balance on their database. Although I agree with you that this is not explained anywhere. This ledger could have malicious code that might mislead you into believing you are "deleting" what has been "sent" to you. To finish the analogy, that Chuck E Cheese is instead a mob hangout and they rob what you brought with you
Oh that's clever. And also, who the hell allowed a system of implementation where positive confirmation of transfer out is required before taking action. Idiotic.
Actually, this has already happened. There are many people that got sent an NFT that hack their NFT artwork browser to delete or move their stuff away. Much of the time they are aware of it, but now they need to live with the known virus in their wallet and they cannot send it away because the contract that they received says so.
so 2 things 1) always check what you're interacting with before you interact with it. 2) malicious crap existing in your wallet doesn't hurt you or your wallet. It's like email; don't interact with random spam crapmail & it being sent to you (which you also can't refuse unless you know the email first & then block it which doesn't prevent them from creating more spam accounts) doesn't hurt you or your email.
They aren’t “stored” in your wallet, your wallet address is stored in those contracts as an owner. It’s the wallet frontend (M****ask , etc) fault for showing you those sus contracts have your wallet in it it. Op***ea already does this and won’t show you sus contracts that day you’re an owner
I loved hearing all of the information from the lawyer. Very informative. Thanks for all of this. Wait, how was I not subscribed?? I've been watching and referencing your videos for years!! Well, I am now.
Even after listening to the "Maybe NFTs aren't stupid" segment, I still think that NFTs are stupid. (Specifically, I'm talking about NFTs in the artwork context as discussed in the video. They might not be stupid for some other use cases.)
"They might be" LMAO
I agree in the sence that there should be more then just a peice of digital artwork with an nft, there needs to be something that you can get access to any other way then getting the nft
the biggest problem with copycat nfts is that the decentralized nature of crypto chains, means you can mint these things with no personal data on the line, making it very hard for anything to be served or to be legally prosecuted. the best you can do is a takedown notice to where the image itself is hosted but if thats your own website its very hard
well see the thing is, for something to be sold, someone has to buy it - just like how we learned how to ignore spam mail, I think it makes sense if we collectively learned to ignore and not to fall for copycat scams :|
funny thing is chain *can* be altered by people who hold power over the chain and people with lots of money
open internet makes intellectual property unenforceable, you either have to censor the entire internet or abandon intellectual property
If it's your own website just break the URL
@@telotawa that's true for data, but not processes. Think of patents. Those are an intellectual property that describes how an invention is constructed. The very nature of patents is that they are publicly shared, but you have the legal right to prevent anyone else from effecting that process for commercial means.
8:40 This is my preferred explanation for asymmetric cryptology that seems to clear it up for most people. Hopefully this helps at least someone. If i go to the store and buy a pack of 4 locks for luggage, they all use the same key to open. Now I keep the key, but i mail these 4 locks out to a friend. The friend has 4 boxes and puts a secret note into each box and secures those boxes using the locks I sent them. They mail the locked boxes to me. No matter who touches one of my boxes or intercepts a box during transit, or steals a box from my front porch, only I have the key to all of those locked boxes and thus only I can read the secret notes. The public key is the locks, the private key is the physical key, and the secret note is whatever data you're encrypting in this analogy.
Well...they'd have to be a little better quality than luggage locks if you really expect them to be secure, but I get you. I guess I watch too much Lock Picking Lawyer, lol.
Kinda... It's more like there's an infinite number of your locks for anyone to take for free. Theres an opposite (essential) function of PKI: the 'locks' work in the reverse way too. You can lock a message inside a special compartment in the luggage(with your key, not your friend's lock) that anyone can open and read with free public keys, but only the secret key owner (you) could have put it there so it proves it was not tampered with en route (authenticity), and you can't later claim that you didn't put it there (non repudiation).
Basically NFT is does not contain the artwork but a token that contains an address/link to the artwork. You don't own the artwork you own the specific token that contain the link to the artwork. The artist can probably create another token that contains link to their artwork. Like a an authorgraph, they can make it as much as they want. (Correct me if I'm wrong)
I think one key component of the, "Are NFTs stupid?" question is not just, "Is the concept of digital ownership stupid?" but, "Is the NFT implementation stupid?" Imagine if a private tech company started up specifically to manage token->owner mappings. Their mapping is publicly available, so anyone can verify that they indeed own the listed token, but it's privately managed. Wouldn't all of the benefits of NFTs still apply? How does a public, decentralized ledger truly help anyone in the long run? If DeviantArt started supporting a purchasable, publicly-posted artwork->owner mapping ledger, wouldn't that be way better than the Etherium blockchain? Like Dan Olsen said, NFTs are a problem created to justify cryptocurrencies. The concept of digital ownership isn't stupid, but, while NFTs have provided us with insight that there is a need / desire for this form of digital ownership (and I believe that insight will outlast NFTs), the implementation is so convoluted that NFTs are far from an ideal solution to the problem.
you have it backwards. digital ownership is what people think is stupid. nft is a reasonable enough technical implementation.
@@joshieecs yet not perfect, so let's just look forward for what will be created next
Public availability means ownership that persists. For example, a videogame publisher could grant licenses as NFTs which could then be transferrable AND could grant access to multiple platforms (e.g PC vs console) AND that license would be provably yours even if the publisher or all the original platforms went out of business. And it could be done without expensive legal agreements between different platform holders. A new platform could simply reference the Blockchain and know that a given user could be freely distributed that title due to their provable ownership.
@@joshieecs Not for something as simple as digital ownership. What benefit does decentralization offer over a centralized “ownership” authority, much less all the inefficiencies and risks created by having to work on a cryptographic blockchain? As well, I didn’t say people aren’t mocking digital ownership. I just said that the concept of digital ownership isn’t stupid, at least no more than collectables in general, like Steve said. There’s a market for anything, and that NFTs have uncovered a new market is actually impressive… even if that market could be much better serviced by something else.
@@DanKaschel The blockchain isn’t any more permanent than any other publicly-distributed read-only ledger. As opposed to requiring every ownership management authority to agree on the ownership providence, I would agree there’s value in there only being THE Etherium blockchain as THE single authority to manage ownership… except Etherium isn’t the only blockchain… it isn’t even the only Etherium blockchain. From a technical standpoint, the examples you show are still things that could better (more quickly, cheaply, easily, and safely) be managed by a central authority. The only reason they aren’t (to a certain extent, they actually are, though) is because there hasn’t been a desire for them. The examples you show are examples of NFTs being a solution looking for a problem.
So the fact that the NFT's we hear about are some sort of artwork means nothing. The NFT can point to anything, even nothing at all. This 'pointer-to-nothing' can then be sold and bought, for whichever amount of money (real or imaginary). So all those schemes for laundering money by pretending to sell something for some money and pretending to buy it back for a different amount have suddenly got legit?
As legit as you can get in the crypto space. Watch the Folding Ideas video, its long, but its an eye opener !
It's finance economy going hyperbolic. We already have houses, products, the future existence of a product, the right to buying the future existence of a product... etc. being bought and sold simply to be resold again and again for profit, so going from there to the ultimate level of abstraction, buying and selling literal nothingness, while still another step, doesn't sound too removed from the rest of the financial sysyem and just worrks to show, in my opinion, how ludicrous this has all become
That's "art" in a nutshell. Why does three lines and a circle cost $3 million? Because that's how much dirty money needed to be laundered.
You could. Although laundering money on a PUBLIC ledger is a very bad idea. It's way easier to get caught, since anyone can follow your tracks.
All money is imaginary
I see Steve as becoming a mad scientists in his latter years. He has the hair, the curiosity, eccentricity, and intelligence to make the impossible happen. If you feel a tap on the shoulder and see no one, it is Steve pranking you with his cloaking device. He had to shed the clothes, so be happy it works. Seriously though, I really appreciate Steve's hard work putting the videos together...I always learn something and never get sleepy watching them.
So it's a signed version of their digital artwork (or the token is the signature of that artwork, I guess )... that's the best explanation I've heard of NFT!
Yes, but the signature is an arbitrary number and it's not in the picture. When you hold your precious 'signed' picture, is exactly the same as before.
NFTs are a solution looking for a problem. Every NFT implementation I've seen so far has been either stupid or a scam. Can they potentially be used for something good? maybe, but usually there's a non NFT alternative already working there where the NFT is completely superfluous. Can NFTs replace microtransactions? Sure, but its just moving the database to a blockchain instead of the developer's database. Can they become tickets? sure but you still have to trust the issuer that the event exists and you will be let in. Can NFTs be used in smartcontracts? sure, but if you have an issue you can't appeal to anyone except a court and that's essentially the same as regular contracts. It's all crypto bros looking for the next big crypto bucks, so they invent solutions to problems that dont' exist.
It's also worth noting that it's a 12 year old solution looking for a problem. The technology is clunky and slow, and gets slower the more you use it. Almost all block chain activity actually ends up being done by seperate brokers that don't use block chain because it's THAT BAD for actually using.
The "problem" NFTs solve is an insufficient amount of fraud and money laundering. And they are a MARVELOUS solution to that problem.
> Sure, but it's just moving the database to a blockchain instead of the developers database. Exactly, thank you, let's all agree to stop there and move on and let people decide where they want to store their own stuff and what they think is more reliable 🤷
I think the issue is that the systems that already 'work' don't work everywhere, they just work in the West so we've decided that crypto tech is unnecessary - we're able to have greater trust in institutions/government than much of the rest of the world, but being able to change who you have to trust, or to eliminate the need for trust in certain parts of a transaction is beneficial in those parts of the world where the idea of trusting the government is a joke. The only project I've seen so far that uses NFTs, that can't be done using traditional finance routes, is called Empowa. They're building affordable green housing in Mozambique. I can't speak for them as I don't work for them, but they claim that NFTs have basically greased the wheels of their business and allowed it to function in a way that traditional Mozambican finance couldn't have allowed.
I think that the eventual use of NFTs will be boring and trivial. The practical part of NFTs are not in investments or getting rich but more in their core use of verifying the uniqueness of a record. One solution that comes to mind is in replacing Notaries. There are many important documents that I have to take to a special person so that they can stamp it, in order for the person that receives it to be assured that this document is authentic. It could be something like a deed, or contract, or birth certificate, but before I can use this or send it in. I need to drive to a person and pay them so that they can authenticate this document. If this document was issued on a government blockchain as a non fungible token, it would completely remove the need for each copy of this document to be stamped. The blockchain would verify that this document is unique, authentic, issued by the correct authority and assigned to me and only me. Imagine a situation where we as a society don't have to worry about forged documents any more. Changing a single character on a document would not work since the block chain would prevent such a situation from being verified. Of course there are other possible issues with how practical something like this might be at scale, and the logistics of a country or government having a blockchain and the issues between local and state government having different blockchains, etc. My overall point is that there are some valid use cases and they might not be exciting or even tied in with monetary value like they are currently. Last time I used a notary, me and another person had to sign a document. I needed to coordinate with this other person that lives across the city to meet at a specific location so that a third person with a stamp could be present to verify the we were who we claimed to be and witness us sign the document in front of them. With a digital and secure version of this, like and NFT, me and this other person could use our mobile phones to do the same and only pay a few cents. I could have saved a whole morning and the notary fee and done the same while sitting on the toilet.
I've seen a few explanations of NFTs that make the analogy to naming a star. You use to be able to send money to a company that would give you the right to name a star some place in the galaxy. The company would record the name, and the person that named the star in a ledger, and then send you a certificate stating that this star was named by you. Do you own the star itself? NO! You could never own a star. BUT according to this company you PAID to name that star. But some other company could have had someone else to pay for that star. But the bigger issue is this: What happens when that company shuts down? Do you still have a star you named? Not really that ledger is gone... You really haven't gained anything but a piece of paper.
So the secret is to name a star in a Blockchain, got it /s
This is *so* close but misses a really big point: MILLIONS of people are supporting your Star Company. They have an ongoing and strong interest in making sure the Star Company continues into the future indefinitely and that it keeps perfect records of every star ever named. That's very different than the actual star-naming companies that have no incentive to keep perfect records, to never give duplicate names and can go out of business relatively easily. If longevity matters, blockchains have an edge.
@@x--. Since most humans don't live more than 70years on average, NFTS are literally useless.
@@x--. there's one more thing he's missing with the analogy: star-naming companies never spent millions of tons of CO2 to do their shit, while we are on the edge of a Climatic Abyss
@@samus88 Respectfully, this argument goes over my head. What's 70 years got to do with anything?
We need more people like you and the way you spread knowledge and science.
But is this a seroius number phone ?
To sum up in a couple of words, the main purpose of NFTs is to "build scarcity", since mankind has always (over)appreciated and fallen for anything rare, even if practically useless.
especially money
@@gb2983as in US dollar? But dollar isn’t scarce. It does have 5000 nuclear bombs and 12 aircraft carrier task forces supporting it. Much more work and maintenance in lives and stories.
It's important that it was brought up that the type of law that NFTs are concerned with is contractual law because the reality is that a LOT of these contracts are written in a way that immediately voids them. Contractual law is probably already the most tenuous type of law we have. It is not upheld on an international scale or even a national scale in many countries. It's really difficult to claim that a contract has been signed by use of a so called "smart contract" because even if it is verified to have happened it may have skipped vital procedures in order to be a valid contract. Also, most countries have a hierarchical structure of law meaning that if a contract can be shown to have a conflict with a higher legal power it can be voided on those grounds too. For example... If you buy artwork that is part of a laundering scandal even if your contract is legit it can be voided. Let's say that all of the criminal actions and behaviours of major Blockchain facilitators are exposed (which to be clear is definitely happening)... Well that could be grounds for any national government to no longer recognise the contracts within the entire chain. You would then be dependent on a unanimous agreement of Blockchain users to recognise it as valid in spite of it having no legal efficacy. This has already happened to people who have paid for contracts that aren't binding and find that there contract has been resold on a disputed split of the chain. So yeah.... Not safe.
I can see one scenario where it doesn't end up highly regulated and that's if industry money can pull off what pyramid schemes did in the 70s and 80s. One highly active magnate [DeVos] got the ear of a few presidents, and pyramid schemes got to rebrand as MLMs and thrive on lax enforcement for decades. Maybe I'm just pessimistic but at least in the U.S., we wouldn't even necessarily know we were electing politicians getting crypto money. Regulatory capture is a real possibility with any industry making a lot of money and facing possible regulations. Just to be clear this is not a positive statement about crypto's future viability, it's a negative statement about its potential to harm to democracy.
@@NovemberXXVII I think the best way to describe NFT is to compare it to the Antique show. If you take an object to the Antique Show and the expert recognises it as the same object that once belonged to say Winston Churchill or Napoleon then suddenly that ordinary object will have a greater value, It is the story behind the ownership that makes it valuable to someone but maybe not to everybody. With NFT you can tell a story of not only who created it but then who owned it along the way. Say if you bought a spoon that once was proved to have been owned by some movie star or your own great, great, grandfather then suddenly it has a value that is not comparable to other spoons to you or to a wider public. It is like having an origin story. For example, some artists gain or lose value throughout history. Sometimes they become trendy but later go out of fashion or get lost but their ownership is stored inside a database. So a copy of it, no matter how perfect can't be flogged as the original.
@@ExiledGypsy with the exception that in this case you don't even own the spoon now. The spoon the token links to can be removed at any time...
@@Engy_Wuck Well anyone can just throw their wealth in the sea as well. But I don't think people often do that, do you? The idea is to keep the NFT as proof of linking the ownership and the object as a way of managing your possessions. But if you don't care you can always melt the spoon and sell it as scrap or sell it to an idiot who won't insist on the transfer of the token and there is no other proof of transfer of ownership. In which case you can still claim ownership sometimes in the future. Then you could ask for the object back, dissolve the token or transfer it to whoever possesses it. It all depends if you want to create an origin story for something. Now a person like the executor of a will or a museum could do that if the thinking is that spoon could have added value if associated with the ownership. In case of doubt when you are buying something the answer to the question: Is there an NFT token associated with this as part of any kind of transfer of ownership. I hope that is clear.
Ah, easy money for both the owner of the spoon and the famous person then. "Hey, take ownership of this token that points to this spoon for a couple years. Thank you, now we can sell the spoon along with the token to some schmuck, because apparently this was your spoon once". Of course, it would require two assholes and some time to pull off instead of one asshole and no time (which is the already existing case of someone going and telling you "this spoon was owned by Queen Elizabeth, wanna buy it?"), but I guess the added benefit of having an apparent proof is worth the requirement of extra assholes to be in on a longer term scam, depending of course on how much money you can milk out of said proof. NFT tech doesn't really solve much, at least not in an way that's definitive enough to justify the added costs (in my opinion at least). In the end it's just another way of organizing the same data we already deal with.
NFTs are an excellent way to manufacture capital losses to offset actual capital gains and avoid taxes.
Yeah, like the wife of a former president has EVER done that!
This video is the best explanation I have seen for what nfts are. I think its still early in the game for nfts and think they will have a good future.
Essential for them to work is the 'Greater Fool Theory' which might not be much of a theory but reality.
If you want to support an artist, you can just give them the money, whether by making a commission, supporting them on Patreon/Fanbox/etc., or simply by donating to PayPal or wherever they accept donations. NFTs provide no additional benefits here.
Yep. The furries have had this problem solved for years
even got drawback in unnecessary energy consumption
@@borkborkfoxxo279 commissioned art has been a phenomena for centuries p.s. don't car for your childish joke or furries
I don't think you understand. Wouldn't you want a signature from your favorite artist? That's the value of an NFT
@@sphereron no not really
The notion of digital scarcity is asinine. NFTs feel like a backend to help inforce that notion.
Capitalism: We need scarcity to enforce class division and unequal distribution of resources Digital goods: *lack the concept of scarcity* Capitalism: Well that just won't do. I have something for this
@@saeedrazavi4428 Well put.
Thank you! Some day we have to realise that digital good creation cannot be adequately and sensibly supported by capitalism.
I guess digital scarcity is not really happening because every day there is anew type of token released, diluting the scarcity of all previous tokens.
@@saeedrazavi4428 It's not capitalism, it's consumerism. Also there is plenty of other things that can be used to enforce class division why would they need to rely on scarcity alone? Hell you only need to look at the continual class difference between the nouveau riche (who are overwhelmingly inarguably wealthier) and old money. In other words: You can't buy class.
I have a question regarding the trading cards comparison. If the company that produces the trading cards goes bust, then the trading card most likely still has value. Perhaps they even increase in value. But, what happens if the website that hosts the artwork of an NFT no longer works? Doesn't that mean a person who owns that NFT simply has a sort of receipt with a URL on it that no longer works?
That is a really good point and I never thought about that. I think you would still be good because when you get an nft it would be noted in blockchain. I think you could still prove that you have the nft and your the current owner without the website working.
Thnx this actually helped me understand NFT's better. 👍❤
Once an NFT of a piece of art is sold... What's to stop the artist making another NFT that has a different location on the internet, but represents the same artwork? Surely that would devalue the first NFT?
Or the buyer making a copy, then selling either the original or one of their copies.
Yes, but such is the nature of artificially attributed value. If something does not have intrinsic value due to what it is (i.e. it can be consumed in some way), that value is always subject to flux and can be easily manipulated under the right circumstances. It's not as easy, but an artist can paint a second copy of an original work as well. Will that devalue the original or increase its value because it's considered the original? It could go either way and is basically a matter of convincing more people one way or the other. The value is arbitrary to begin with, so increasing and decreasing that value is also arbitrary and is depending on public perception. Crypto and NFTs are no different and fiat currency is not far off either. Hell, when gold was used as the standard it was still basically an arbitrary value, but now we actually USE gold so it has an actual use and therefore intrinsic value beyond status symbol.
Nothing physically stops them. I suppose the first NFT will probably have higher value if people like the idea of it being the first one. It's a bit like artists that sell limited edition prints - nothing physically stops them selling more copies later.
It’s like saying making prints devalues the original artwork
@@MonkeyJedi99 They don't even have to buy it, just download the image and make an NFT of it, but then it won't be THE nft made by the artist, it's just another NFT of the same image.
A simpler way to think of an NFT is that it's a receipt. It's a fully traceable receipt, but all the receipt actually says is "I own this receipt". It might also have a picture of a cat or a link to a tweet on it, but that is basically irrelevant. BTW, I am currently selling an NFT of Steve Mould's wedding ring if anyone is interested. And an NFT of the abstract concept of stupid.
I'll take ten of those please.
Owning an NFT is like having a receipt which says: "In you enter the Louvre, go down the stair under the pyramid, take the stairs to the second floor, take the corridor on the left, walk until the room 17B, enter the room, the fifth painting on the right wall is yours". But you cannot take your painting home, everybody can go to the Louvre to see it and take pictures of it an reproduce these pictures indefinitely
@@francescoghizzo That's exactly it. You get the equivalent of a ticket that says "some artwork, somewhere".
@@francescoghizzo In addition, the Louvre could decide to sell that painting, or simply put it in storage, and it would no longer be where the token says it is. Even if the Louvre sold you the NFT. In the same way, the digital artist could remove the JPG from the IPFS. This may be unethical, but I don’t think it would be illegal. (I am not a lawyer!) You still have the NFT token, but now it points to nothing. What is its value then????
@@Eric14492 Exactly!
And now that the bubble collapsed, we know that the true value was in finding out who had too much money along the way.
Thank you for making me understand that nfts could be the way to organize deals people have between each other. I feel i understand niw what makes some people crazy about blockchain and nft smartcontracts. ) Don't getting obsessed, but seeing lots of ways to utilize this tech.
One thing that you didn't really touch on are the implications of what owning just a particular URL to a file on a server actually means Unlike a trading card in your possession which puts the onus on you to keep it safe, if that server goes down or someone with access alters the data on it, you can be left with nothing, or worse (here's a nice virus to hack your etherium wallet) And the question remains, what is the thing that is actually valuable; a line in a ledger that says you have a link to some work of art, or the very art itself? What's more valuable, a trading card, or a line in a ledger saying you know the address as to where the card currently is?
so research the nft before buying & ensure they are storing it either on-chain directly (SVG are just text, this is easy, for example) or on permanent, immutable storage so it can't just go down viruses can't do anything unless you run them. so here's an obligatory reminder for anyone reading this: DO NOT interact with anything you aren't sure about. better safe than sorry. value is subjective, most of the time.
Most urls associated with nfts are permanent and immutable
instead of buying the NFT of your friend's artwork, why not just commission them or pay them directly for the art? buy a print? you can support your friend and buy art that is meaningful to you without having to "wait for nfts to become carbon neutral"
Just imagine paying your favorite comics author for the original drawing of a strip and receiving an actual piece of paper with the original drawing of that strip. What a bizarre concept! Naah, let's buy a line in a database stating that you've blown fake money to reach a public URL on the internet •_•
Thanks, this video explains NFT better than any article!
24:45 It's almost a valid point, but Trading cards have value for actual reasons. As far as I'm aware, all trading cards except those representing pro athletes are part of a card game. i.e. a game that can be played using those cards. What determines the value of these cards is two general factors, -their rarity (artificially introduced) -their power (how good is the card) Even many 'rare' cards aren't valuable because they're simply not good in the game so aren't sought after. One of the most valuable playable trading card is the Black Lotus from MTG, which is an old card from a finite set of limited cards. It's also an extremely powerful card, being powerful enough to just be outright banned in all formats (although, most of what enforces its extreme value is the meme and the high cost of the boxes that contain them). Football/baseball etc. cards are valuable because of rarity and the fact the cards represent a player in an isolated moment of history. The most valuable ones are famous players from past or extremely limited cards, (a player who didn't want to be on a cigarette card, but had already been printed a few times). NFT "Collectables" are simply permutations from a set of random attributes, they're not 'rare', they're not historic and can't be used to improve your play. So their "value" is entirely speculative, not reinforced.
He was showing baseball cards tho
@@mattmmilli8287 Did you read the whole comment or just the first 3 lines?
I’ve been half-heartedly trying to understand NFTs for a while now, thanks Steve for making this video! Feel like I finally know enough to know I don’t need to know about it!
Don't worry mate. It'll come for you in a few years. Once the marketplaces get cleaned-up and more protections are put in place. Reputable businesses like having strong transaction ledgers, protects them and their businesses.
@@x--. Why should anyone put so much effort in protecting that stuff, if they could just digitally sign the art and sell that signatures? It would be much easier and technically give the same or even better proof. The only thing you could not do with that so easily is speculating. And that's actually what NFTs are today. Objects for speculation, because the byers don't have an interest in the artist. They speculate that some time later someone will pay them more. That's the reason they bought it in the first place. But why should someone do that? There isn't really a point in it besides supporting the artist. But the NFT doesn't really have a value. Just the hope that someone is stupid enough to pay more later.
@@Duconi First, I think you're absolutely right about the ongoing speculation. Second, did you watch the video? I think he made a pretty good argument for what the value of NFTs could be, even if it's pure speculation at the moment. Third, digital signatures grant you what I would call providence but not publicly provable ownership of the token. The "thing" preventing someone from selling the same token over and over again is that eventually they get exposed on the blockchain. Nothing like that would apply to digital signatures on an image file. I could copy that image, strip out the digital signature and there's no public record. The blockchain establishes a public provable record of the ledger, what happened. And just to be clear, I don't use any blockchains or crypto. I'm not in favor of it and even less in favor of it with the huge power consumption being expended to amass the currency these speculators want when it becomes more mainstream but I think I have a pretty good grip on the tech.
I think you should get a bit more information. This was a relatively neutral, but overall positive take on NFTs. He only mentions a lot of the negatives in passing, and misses mentioning a few negatives altogether. Id recommend looking into it a little further before you can really say you dont need to know more. Look at some extremely negative takes, look at crypto bro takes, and come to a conclusion thats somewhere in the middle.
@@Yipper64 As I'm not planning on "investing" in any of this stuff in the near future I'm busy just trying to stay afloat but I see your point. I think crypto bros are hype queens I wouldn't trust more than I could throw them. I will say most of the negative takes I've seen pretty clearly don't understand the technology, that makes it hard to listen to any of their opinion beyond some obvious criticism (environmental costs of mining). If you have links to any sophisticated critiques where the author actually understands the technology I'd be curious.
NFTs are good for 2 things - scamming and money laundering.
Yes, they are!
0:02 Short answer - Yes. Longer answer - Undoubtedly, yes.
I can't believe that that expensive NFT points to some fricking ipfs gateway (that might shut down at any point) instead of the actual ipfs path. FFS how rotten can this nonsense even get!?
Its probably a tax evasion scam so it doesnt have to point to anything.
Noticed that too. This link will be invalid in few years probably.
I agree somewhat, but it looked the ipfs URL was mentioned within the HTTPS URL - so if the HTTPS server is down you could re-interpret it as pointer to the IPFS url that uses some idosyncratic syntax that might require custom parsing.
@@superfluidity Too bad the NFT holder doesn't own control of the domain the URL points to...
@@MegaNardman I guess his argument was that the gateway URL still contains the real Hash that is used on the IPFS network, so one could just interpret that dead URL in a different way and it would still work.
Are pyramid schemes stupid?
Only for the people who aren’t at the top.
@@pmsteamrailroadingso only for most of the people involved xD
They aren't It's a clever scam scheme
Bitcoin, the largest Ponzi Scheme in the world.
I’m so glad this is the first comment I see
I find the analogy with baseball cards and signed celebrity photographs very very good. I do believe that there is a small part of people who like this kind of stuff and that;s amazing. It also reminds me of movie props (as in, easy to get a light saber toy, but the original one is somehow more valuable) or sneaker collectors. But they have very limited practical application and are definitely not anywhere near as practical or good as the current communitie is trying to convince everyone they are.
the best explanation i heard is that NFT is like a map to the treasure in were you dont own the treasure or the map. You just writ your name on the back on the map.
@@scasny Not even that. Writing your name on the back of the map would give some new and unique quality to the map. You just write you name to a sperate piece of paper that everyone assures everyone else will always be with the map despite the fact that anyone can get an exact, down to the molecule, copy of the map at any time.
I'm no expert, but from what I understand... Buying a NFT of a picture is just buying a line of text where is written a web link. The digital image pointed by the link is stored on a server and usually the owner of the NFT has no control over it... so what will happen when the server stops working? when the image will no longer be accessible? If we keep the analogy of the baseball card, it's like having a card where the picture will certainly disappear over time (who would want such a card?).
@celumil It's called "link rot" and it very much is, yet another, problem with NFTs and the like.
Thank you for creating this video spreading education for blockchain technology. It will exponentially advance us once it begins to get deeply engrained into our everyday financial live.
Actually the wedding ring example is very useful. You value your wedding ring more than any other ring. But to anyone else who has no emotional attachment to that ring, this is just yet another piece of metal that could eventually be melted to make a new one. What is non fungible to you is completely fungible to me. Non fungibility is highly subjective.
Not to a court. Watch Legal Eagle's coop video on this. There's a link in the description of this vid.
@@LabGecko I've watched his video. But I'm talking here about the signification of the term non fungible itself, which doesn't have any legal definition. And I agree with Legal Eagle that all the discourse about NFTs replacing legal contract is a huge bullshit. NFTs don't have any binding effect if they are not backed by an official contract that clearly defines what the NFT represents and what rights and duties are associated with the "possession" of the NFT. All the talk about blockchain technologies revolves around removing the need to trust other people. This is completely delusional. Our entire society is built on trusting millions of other people with behaving mainly in a normal way. When you're a kid you trust your parents to feed and shelter you. You trust your professors with teaching you things. You trust any food seller with not poisoning the food they sell to you. You trust the architect and builders with making a solid home. Etc. Without trust society simply doesn't exist at all.
@@christianbarnay2499 If you're saying the term "non-fungible" _in the context of blockchain NFTs_ doesn't have any legal definition, then I agree. My comment was pointing out that if you try to take any of this to court, you must necessarily use the *court's* definition of non-fungible, and that has a specific definition that Legal Eagle showed in his vid. (edited to fix malformed italics)
kzhead.info/sun/pr6Tm9eIgXqclJs/bejne.html any of y’all like mustard? LMAO
no, fungibility is not subjective at all. fungibility means that one item is equally tradable with any other items of the same kind and owning one is not more or less valuable that the others. example: physical currency is fungible, one dollar bill is equally tradable to another. or one quarter is equally tradable with another. and one euro coin is equally tradable with another. that is fungibility. non-fungibility means that items are not fungible. the definition is quite objective, unless i'm missing something.
Hilarious that "Escrow" sounds exactly like the french word "escroc" which stands for "scammer"
Heh, there's a trust issue on the other side: you trust that you'll be given the seat. Computers can't guarantee it.
Thank you for creating this video spreading education for blockchain technology. It will exponentially advance us once it begins to get deeply engrained into our everyday financial lives.
I've watched many videos talking about NFT's and this is the only one that made it simple enough that I feel like I actually 100% understand how they work, and what an actual non fungible token refers to. I still think they're stupid though lol.
I have two, very similar questions/concerns: 9:27 - So a concert ticket can be lost or stolen, and an NFT cannot. But the private key can be (although it can't reasonably be counterfeited). This just seems like moving the problem one layer up. 11:05 - So you can buy an NFT with a cryptocurrency without trust, but how can you buy a cryptocurrency without trust? Again, this seems like the problem has just been moved one layer up.
actually an nft also can be stolen due to their implementation being programmable - so its possible to build malware into one that when interacted with (for example to get rid of it) will transfer things out of that wallet
I'm still convinced NFT art is a scam that buyers are hoping the majority of people agree that their NFT art has the outrageous value they bought the NFT for lol Like normal insanely expensive artwork...it is reserved for the ultra rich and wealthy to help transfer wealth, store large sums of money, diversify, or tax reasons. Physical art is much harder to copy though.
*While* buring far more energy than should be necessary for something like that
That's not that different as stock market. The point is that exchanging NFTs is not to be confused as exchanging ownership of the art (you only buy or sell something related to a piece of art, and though the art is not original, the NFT is). Where NFTs are stupid is exactly the same reasons why stock market is stupid and may collapse, with the main difference being that stock market directly relates to production and follows outside rules, where NFTs are self-dependant and only work if people think it does.
Tax reasons, mostly. Just like "NFT art" is entierly for tax reasons and money laundering. NFTs are the scam everyone was worried cryptocoins were going to be.
Right now it's completely stupid. Rampant speculation, people hopping on "NFT mints" as soon as they come out just to flip them like hot potatoes. Just go on Twitter or some NFT site and look at the "art", it's all cookie cutter stuff... Countless Monkeys, countless animal caricatures, countless pixel art, and combinations of all 3. None of this stuff will be wanted in a few years time, and they're all being bought up like they will be. $2000 or more equivalent for an 8 bit penguin with sunglasses or a cat with a hoodie? Really? Yes... but it's not going to last....
A big difference is that stocks are a digital token in a way, BACKED by a PHYSICAL asset...the company. NFT art, on the other hand, I can copy/paste/save for my personal use and viewing, or even making additional copies to distribute/sell illegally.
21:38 I was genuinely distracted by how fantastic the quality of LegalEagle's footage is. Like, wow. That's one crisp image and beautiful lighting. I thought we were jumping to a clever sponsor or something, my goodness.
So, best case scenario, what you'd "own" in the beeple example is a pointer to a location on a file server? However, file servers are rotated and replaced as physical objects. Also, URLs are not real objects and change often. If the server suddenly had a glitch and the file had to be replaced, you would then own a pointer to a counterfeit file. Also, if the server farm went bankrupt, you only really own the pointer to that file at one point in time and some finite-but-unknown period thereafter. The original file may no longer exist, and your pointer would be as useful as a deed to land on the island of Atlantis.
No, it's the ability to buy and transfer digital media and ownership. You can even own part of something. In the case of digital art, you can buy the usage rights to a piece, and then if you find someone online selling copies of it you could prove ownership and have that website remove the copies being sold, and can even take the person to court proving your ownship of the digital art and have them hand over all the proceeds of them selling the forgeries. It also means more than one person can own something by each having a smaller part. In future if the value of that artwork increases and everyone who owns it agrees to sell it, the proceeds of the sale get split between the owners. Equally if everyone EXCEPT you wants to sell their part, they can do so. It doesn't have to be digital art either. An actual painting's ownership rights can be put on the blockchain, so if someone or many people want to buy or sell their rights to a piece, they don't have to go to a 3rd party like an auction house and pay commission on the sale, they just sell their part on the blockchain and it's done. In the auction house all you're doing is buying a certificate of ownership and it doesn't actually do anything to the piece, just confirms who owns it. NFTs do this without the need for an auction house. Think of things as well like property rights. Currently if you want to sell your home you have to go to a centralised land registry and have to pay to update the records, have to pay a legal rep to draw up all the paperwork for everyone to sign, and then have to put the property in escrow while everyone waits for the payments to be transferred and confirmed. NFT's allow this to happen without the land registry, and without a lawyer. You just set up a smart contract which automatically transfers the ownership of the house to you the second the crypto hits that wallet at the agreed price - It's thrustless and doesn't need a land registry or a lawyer or even a bank. It's all done in seconds, is final, and can't be reversed. Think of any instance where you need a 3rd party to confirm ownership. NFT's remove the need for 3rd parties. A good example is what BTC did for money. You don't need a bank or 3rd party to give you a bank statement and prove you have a bank balance, and you don't need banks and card providers to transfer BTC from you to a 3rd party.
You still seem to have a bit of confusion around ownership, particularly in your ticketing example. You don't own the ticket (or the NFT), *your private key does*. Whoever has your private key owns the ticket. If you lose access to that (say, you get hacked), it's just as gone as a physical ticket or normal emailed ticket would be. The transaction on the blockchain doesn't record who you are, only which private key you happened to use for the transaction! Of course you could make the smart contract require some sort of identity information. Say, a name and state ID number (driver's license, passport, etc). Then you'd have a trustless link to a trusted central identity validation system, so you could say you own it... but you've lost the benefits of trustlessness since you're depending on the central database to link the NFT to the identity.
27:20. “You are buying an NFT that points to the location of the artwork on the open internet”. No. You are buying an NFT that points to a location on the open internet - a location that is owned and can be altered freely by someone else and not by you. There is nothing to stop them from changing what is at that location. Or shutting it down. There is no record on the block chain of what that location contains. And there are better ways to give artists your money if you want to support them.
If the location use ipfs, then you cannot change it. At best you can delete it, but at least the owner itself should keep a copy.
Imagine the shitshow that would happen if someone replaced rich mans funny monkey jpg with literally illegal content. or a picture of poop, which would have less shock value but would at least be funny instead of horrifying.
Awesome video. I totally appreciate it, and after one year and a half I would love to hear from you an update on the topic.
Nice video! Just a comment that can save the trouble of reinventing the wheel: the sciences that deal with the question of value are economics (for societies primarily based on money exchange), and, in more general terms, anthropology. I notice this tendency on a lot of natural science channels to disregard social sciences knowledge when dealing with a social sciences topic. I do not think you have to bow to tradition or authoritative wisdom, but you might want to consider this before going solo, hehehe. Anyway, love your content, my man! Greetings from Brazil! ❤
I actually was under the impression that the entire jpeg file was on the ledger. The fact that it's not seems even more stupid to me. It doesn't solve the problem of the file being publicly accessible; the pointer tells you exactly where to go to find it. And it introduces the new problem that you're relying on an external server to keep existing and hosting the file.
IPFS is a decentralized storage network
@@browolf the ipfs adress gives a file that points to a http ipfs gateway instead. If the gateway goes down you can't access it directly, you need to copy the ipfs URI from the http URL
They can be but usually aren't because it is too expensive to do so in most cases
On-chain storage is a developing technology, only reason we have the whole links situation is because people were too impatient to get started with it, that they didn't let it mature
IPFS is like bit torrent, it requires people to seed the file. You can do this yourself, or someone could have an old copy and randomly decide to re-host it later, and it would have the same address/hash. But if there's nobody hosting the file at the time you want to download it, you're not getting it.
I'm a musician and NFTs were made of my music without my permission by somebody I don't know, for sale on the internet. It was a very stressful experience to get them taken down. If you're gonna buy an NFT - which I do not and will never support - make sure it was minted by the person whose art it is. Also though, f*** NFTs and what they do to the environment
You experienced one of the main, most criticized problems with the very idea of NFTs: near impossible to tell if it's legit. All the cryptography can't do it.
Better yet, never buy one. Also, don't answer that Nigerian prince emailing you.
On your last point, yes, absolutely. We already waste of a lot of energy on Visa, Chase, Mastercard, and all the other credit card providers. Building a system that requires the waste of a lot of energy on computing power is not inherently better (although, now I really want to know what the comparison would be). On the first part, that really sucks and until marketplaces build in protections against that sort of theft they are going to generate a lot of well-deserved hate.
@@x--. The problem with coming up a way to verify the legitimacy of people minting NFTs is that it is *literally impossible* to do without trusting a source outside of the blockchain, which completely defeats the whole point of using a blockchain (which is specifically to be self contained and to not trust *anything* outside of it). Effectively the best that could be done is to make an outside server with a database and link to it from the blockchain, which is essentially pointless
@@x--. Before credit cards, how exactly do you think money was moved around? The cost of printing physical money, along with transportation and guarding it, greatly exceeds the cost of moving it digitally.
You cannot send BTC to another wallet without the destination address AND network protocol. Also, the distributed ledger is parked on 'nodes' or computers that have copies of the ledgers (blockchain). There are lite, full and miner nodes. Miner nodes are computers that 'mint' new coins (hashing BTC block, 1MB in size) and validate them (proof of work). A miner competes to create a new block by taking all of the network’s new and unconfirmed transactions, as well as information from the previous block (i.e., its 'block header'), and hash them using the SHA-256 algorithm. You are referring to 'smart contracts' which are part of the ETH blockchain. A smart contract can be used to define a 'token' like DeFi and stablecoin tokens. And NFTs. Other blockchains that have smart contracts are Fantom, Hyperledger, NEO and NEM.
Great video, awesome collab on the legal aspects.
There are already nfts of other peoples artwork without their permission. Some have been removed but most artists this happens to hate it.
20:10 that right there. if an artist wants to make an NFT of their art, fine, but if someone else makes an NFT of art that isn't theirs, which is overwhelmingly the case, then NFTs become a problem. cool tech, misused horribly
as with all technology, it has the ability to be used in a good or a bad way, and that doesn't make it inherently bad.
@@Derokorian Sure, like leaded gasoline.
@@Derokorian The big problem though is that NFT's are being sold as a solution to this problem while it's happening in plain sight for everyone to see. If all of the "bad" things NFT's are supposed to fix still happen, then what's the point of it when there are arguably better, more mature solutions already in use and available?
@@DarthBiomech Out of literally every single technology ever made by humans that you could use as an example, you went with *leaded gasoline* ? Like, I _guess_ , but... All you can do is burn it....and it releases so much lead...
Hello, thanks for the video. Your lawyer friend Devin looks like a character out of a cartoon. Extremely visually awesome. Loved it :D
Exactly the same. :D Some 3D animated movie by Pixar. :D
Thank you for posting this. Now all I have to do is watch it a couple hundred more times before I get it.
I watched like 15 videos about what are NFTs, and couldn't get it the way I did from your video. Everyone has those weird explanations from which you can't really tell what exactly NFTs are... but your video gets it 100% explained! Thank you!
"Are NFTs stupid?" Yes, yes they are
I recently wrote a peer reviewed journal article called "When the NFT Hype Settles, What Is Left beyond Profile Pictures? A Critical Review on the Impact of Blockchain Technologies in the Art Market"
I feel like I finally get what NFT's are! Thank you! And... I want no part of it! seems pointless to me to waste money on a digital "Collectible", of an internet address!
So digital art NFTs are cryptographically enforced bragging rights ... great.
Man, if you say that like that of course ir would sound stupid.
@@michaelmcdoesntexist1459 that’s cause it is stupid, it holds 0 tangible real world value. If you got money like that. Buy houses and rent them out to create cash flow and real world assets
@@chrislacascia4547 I'm not denying it XD. But, ya know, even enforced bragging right have a value. Our current society is build on that. That's why autographs, expensive cloth, etc have some value. Yes, is stupid. But we already spend a lot of money on stupid things. My problem with crypto is that some jerks try to convice everyone that is the new big thing instead of another "stupid thing". But the people who get robbed by believe that shit kind of deserve it.
At least clothing and autographs have some physical value as an item. NFTs are actually nothing. Their only value is in scamming someone else out of their money with it.
@@TheGeekRex game skins, gachas, and pornography have the same physical value. And people still spend on them. If you know what you're buying (digital bragging rights) you can spend your money on whatever the fuck you want. And if you buy NFT arts without the proper understanding of what you are actually buying, then you're a moron who deserves to be scammed
I like that you mentioned smart contracts. These are incredibly hard to write well, and pretty much impossible to change once on the blockchain. There is a recent case of millions of dollars worth of crypto essentially being lost forever because of a bug in a smart contract.
What happens if an angry ex-boyfriend or girlfriend created revenge porn as an NFT then gives it to your wallet As far as I can see that is there for eternity, or your national security number, your bank account details, lies about you, truths about you - anything. It can never be deleted.
@@piccalillipit9211 dude, that's like, the whole Internet. You don't need crypto for someone to tell lies about you.
@@Andrew-jh2bn - NO - but you can get a court order to have it removed. That is not possible with the blcok chain.
@@yt_user892 - I work with victims of narcissistic abuse - narcissists' speciality is massively vindictive revenge campaigns. They will simply LOVE this - it will destroy millions of lives will this...
I've been wondering if there's any possible use to NFTs and this video did a pretty good job of helping me understand them better. The way most people talk about them is either circular ("non-fungible means it can't be funged") or the objections are just unrepresentative ("look, I just screenshotted your NFT LOLURDUMB"). The bit about arcade tickets really made it so much more clear. I've come to the conclusion that they're still pretty dumb but there may be some use for them in the future. It's just that, for now, we are stuck with people engaging in the trade and sale of trading cards for obscene amounts of money.
thing is nft uses are all done better by other methods. nfts are not hosted on the blockchain. what is hosted is a hyperlink. this hyperlink can go dead or the contents altered if the storing server goes offline or is hacked. nft images of says monkeys could be replaced with child porn if the server owner decides to or if the server is hacked. also there are fabricated nfts that when sent to people allow the user on the end to steal nfts from the person who got the fabricated nft
I feel like a lot of blockchain is trying to enforce things using cryptology and maths which society tries to enforce using overly complicated legal systems that often boil down to "even if everything burns to the ground, at least we should theoretically know who to blame for it". Though these often end up going against each other as each one doesn't know how to deal with the other and all hell breaks loose regardless.
TLDR: blockchain and NFTs HAVE utility that needs some work, but the current marketplace is instead built around confidence scams. Blockchain is hardly immune to that, though. It has checks for a few processes, but the rest of it is wide open to human error and malicious conduct. Squid coin was intentionally coded so that buyers could never cash out. The DAO, one of the first big smart-contract-based organizations, had a code vulnerability that was exploited to transfer out a third of the ethereum that had been stored in it; most users would have to just swallow that kind of loss, but the DAO was a project of the ethereum creators and other big names, so they forked the entire "indestructible" blockchain to make that mistake vanish. It's a matter of time before contacts are created that contradict each other or that get stuck in perpetual loops with no human interaction to hit the breaks or that commit some crime like money laundering. NFTs with code that transfers out coins or other NFTs have already been made and used, and with no way to refuse incoming transfers, the best the targets can do is remember which of their assets are legit and set mysterious newcomers to "hidden". There's no barriers against mundane confidence scams, and the lack of human oversight means there is no recourse for the victims of these scams. Well...no recourse unless they have so much influence that if they created a modified version of the blockchain, their version would have more value that the undoctored version. They got rid of the legal jumble by just saying "buyer beware", but every NFT collection and crypto fanzine is shouting "BUY IN NOW TO GET RICH" and exercising some cultish levels of social isolation by enforcing the removal of any voice of fear, uncertainty, or doubt. It's a trustless environment, but the speculative projects demand blind faith because blind faith makes the speculative value look better. The rational choice is not to get involved, but the mechanics of the thing have been plastered over in promises, cherry-picked success stories, and outright lies. It's just another money sink for the desperate.
"How do you prove that you were the purchaser of that particular ticket?" Umm, Steve, it's called "will call" ticketing. We've had this figured out for decades, if not longer, and they don't require computers at all, let alone a blockchain. I've yet to see a single use case for NFTs that is both more secure than earlier processes and also easier to use.
Boy you're will call experiences are better than mine ;) Of course, they always seem to lose my comp tickets. They haven't yet built "easier to use" part but it's getting there. Email started off as a command-line experience where you needed to no the esoteric parts of the system to get it reliably right. Eventually, developers came along who did figure out how to make it easy to use and about a decade after that it had all but taken over. So to here. Just going to take a few years to figure out how to make it easier *but* it will get there. There are too many advantages to having a cryptographic wallet where a transaction can be 'proven' without having to rely on paying Mastercard, Visa, Discover, Amex, etc, a but of your sales. That's where the real competition is going to be. Can blockchain be cheaper than credit card companies? If yes, then eventually they win.
@@x--. That doesn’t make any sense at all. Credit card companies do more than just process transactions. So Blockchain garbage isn’t even in competition. At best you hope they adopt the tech on their own, to vindicate all of the blowhard talk about how great the shit is. But the idea that Blockchain is actually going to replace anything, is absurd. Just a problem looking for a solution. Not a solution looking for a problem, but a problem itself.
@@JM-zg2jg Let's talk, my friend. You are right, they do "more than transactions" but the absolute heart of their business (to the tune of tens of billions a year) is taking money from you and giving it to the business. They do this by taking a cut of the transaction and charging network access fees. Do businesses like paying 3% of their transactions (less if you're bigger) to some other business? Don't think so. In California they dislike it so much they have cash vs. credit gas prices. So that's the fundamental question. Can blockchain currency beat 2 to 5% and provide the necessary ancillary services to get consumers to shift? I would bet, yeah, probably. Banks and card processors have to make a profit. Crypto blockchains don't. So it is likely to permeate through society and become more common and accessible. As it does, I don't see what stops it from taking over.
@@x--. Until the problems with mining are solved I don't see blockchains being able to supplant anything long term. Proof of work mining gets more energy intensive over time, and proof of stake is exploitable as all hell.
It's good to talk about the misconceptions about what NFTs are, and the ways in which NFTs can mimic existing trading concepts, such as trading cards or contracts. But I feel like you glossed over the huge negatives, such as the amount of computational power (and therefore electrical energy and technological resources) required to work this "ledger", and the entities who have particular interests in pushing NFT technology (including scammers). In short, the theoretical concepts are all fine and dandy, but they aren't really necessary and they do more harm than good, in my opinion. If I want to give money to an artist, I'll sign up for their Patreon.
@@Dave-rd6sp "only a few months away" how many years have we been hearing that for now lol
@@voidling 5 I think?
If you create an artwork and then create a unique pointer to the artwork i would argue it's up to the artist to decide if both of those are actually the true artwork when put together.
It's the making of a collectable thing out of a commodity. Like mispressing a coin. Having a pair of Nike's worn by Jordan. Or a limited edition printing of a Nascar plate. But... why can't Frank;s Collectibles make another copy even after Alice has run through her 5000 copies?
That's nothing new: artists have been making multiple copies of their works for ages, signing and numbering them. The signature and limited edition do confer some value to each copy. But yes, you will have to trust the artist to not bang off a bunch more copies. An NFT for artwork is very close to a certificate of authenticity for a numbered and signed print. But here's the rub, when you buy one, you only get the certificate; the work of art will hang in a museum where you can view it or show it to others as you please... but just like you have to trust the artist, you have to trust the museum to not go broke, which would make you lose access to your work of art. And for all intents and purposes, it would also make that certificate pretty much useless.
Mispressed coins or whatever example are ALREADY a commodity. Necessity of NFT is a marketing delivered delusion. That use case at best is potentially a slightly more convenient way to scam people into buying the illusion of a connection with something. Which is certainly not new. I could sell the viewing hours of the moon using PayPal and a notepad and pen.
Frank's Collectibles (or rather the smart contract that does the creation) can make as many copies as the contract allows for. Your protection as the buyer is that you can read the text of the contract and see how many copies it can make and decide how much the output (the NFT) of the contract is worth to you based on that number. Only 1 copy? Maybe the NFT is worth something. 5000 copies? Not so much. Of course, nothing but Frank's reputation (and perhaps the traditional legal system) prevents Frank from creating a new smart contract to output/create 4999 similar NFT's, but is it worth to Frank's Collectibles to squander their reputation like that? And those 4999 NFT's would come from a different contract than your 1 NFT. Does that protect the value of your NFT? That is for you to decide.
The question is: who accepts copies from Alice's contract, and who accepts those from Frank's? If you want to display a collectible on someone's service, and it only accepts Alice's contract, then it doesn't matter how many copies Frank's makes, none of them have any value towards displaying it on that service. Maybe some other service is less strict and it does accept copies from Frank's contract... but you'd still run into all the trademark, misrepresentation, and other legal issues. We'll probably see those play out in court in the coming years, as NFTs get more use other than just having one.
As an artist myself, I really dislike them. I follow so many artists and love the art community, but since NFTs became 'a thing', it's gotten to be such a horrible rat race.
what I've noticed, unfortunately, is that much of the horrible stuff is just people being mean to each other for things that they don't understand, and most of the toxicity around NFTs is coming from... people who don't like them.
@@FelinePsychopath I follow hundreds of artists who have had their art made into NFT's and sold without their consent. All by crypto bros looking to make a buck. And if you find discussion about NFT's almost anywhere public enough, it's filled with bots promoting some project that, if you do a little research, is obviously some kind of scam. THAT'S toxic. People mouthing off about not liking or not understanding NFT's might annoy you, but compared to that, is not measurably toxic.
I don't know if it's only just become a horrible rat race with the influx of NFTs, if you've ever dealt with galleries you might be aware of how cutthroat the business can be.
Pukicho on tumblr said that artists that sell their work as NFTs really only care about the value the work can have, rather than the work itself. They even go as far as to claim these people are really just businessmen that are masquerading as artists. I think theres some truth to that and I'm glad to see that other artists also don't like NFTs.
Just like "high art", the price of NFTs doesn't have anything to do with skill, beauty, or effort, only on artist influence with a bit of luck Art has always been like that to an extent, but NFTs just kinda... Shove it in your face more... Don't know how else to explain it
I will say that the "signed photo" thing does not quite work, since to most people, the value in a signed photo is that the signature itself is unique. Even if it's very _similar_ to thousands of other signatures that person has signed over the years, but it is a unique expression of that signature. If you then just photocopied that image with the signature attached, that would have a lot less value to most than an original signature. Also, a lot of people place value on the act of _getting_ a signature in person, the act of meeting this person for even a moment, and the object itself mainly has commemorative value, like your wedding ring. By these measures, I don't think that an NFT ever achieves any of these positive connections. For the types of NFTs we're discussing her, at least, I believe they have NO value except to those few people who just have a lot of money and like to just show off that they spent a lot of money on something, OR to chancers who believe that they can buy things low and sell them high, which is not a wise investment here.
You seem to have missed something. This does uniquely bind the artist to the buyer, as long as the underlying blockchain remains. It's "impossible" to copy the NFT stuff.
@@matteyas If a person genuinely feels that way about their purchase, then that is their business, but I don't believe that most people would feel the same level of personal connection to a hash in a blockchain that they would to a hand written signature, particularly to one made in their presence.
@@timogul That's probably true and might be for another 5 to 10 years, maybe more. What's probably also true is that a majority of the people in the upcoming generations are more likely to feel a personal connection based solely on digital happenings. Either way, that's none of my concern. :)
@@matteyas Except in 5 to 10 years, most of these will be subject to link rot and the URLs/URIs will point to absolutely nothing. Though you last line makes me question _a lot_ about your perspective on these.
@@scaper8 Skepticism is a virtue.
>Are NFTs stupid? Yes.
I'm most impressed with how far you went with eating the picture of Patrick Stewart...other than the excellent explanation overall.