In this, hopefully helpful and useful post, I’ve provided links to the best articles, podcasts and youtube videos I’ve consumed in the last week that I think have given me a good handle on NFT.
What are NFTs?
Wrong way to get into the topic.
You know what digital currency/cryptocurrency is?
Put your hands down, no you don’t. Not even the people who design various cryptocurrencies or the people who buy and sell it on exchanges have a good grasp of it. Because by its nature… it is meaning imposed on something that is inherently meaningless. A random generated string of numbers. Which is kinda the point, and kinda why it is perfect for trading. Voodoo Magic. A thing being worth, whatever people at the moment are convinced it is worth. 🙂
But for a general agreed upon definition of Cryptocurrency? Well see below.
Site Investopedia does a very cogent overview of all things digital currency.
cogent – Dictionary Definition : Vocabulary.com
Cogent comes from a Latin word meaning to drive together, so cogent thinking is well-organized: it hangs together.
Below is a small snippet of that Investopedia article that I highly recommend you clicking on the link above and reading in full (after you finish this post of course).
What Is Cryptocurrency?
A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers. A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.
- A cryptocurrency is a form of digital asset based on a network that is distributed across a large number of computers. This decentralized structure allows them to exist outside the control of governments and central authorities.
- The word “cryptocurrency” is derived from the encryption techniques which are used to secure the network.
- Blockchains, which are organizational methods for ensuring the integrity of transactional data, are an essential component of many cryptocurrencies.
- Many experts believe that blockchain and related technology will disrupt many industries, including finance and law.
- Cryptocurrencies face criticism for a number of reasons, including their use for illegal activities, exchange rate volatility, and vulnerabilities of the infrastructure underlying them. However, they also have been praised for their portability, divisibility, inflation resistance, and transparency.
Ok, so long story short, cryptocurrency is a completely computer generated currency/digital currency, a bunch of algorithms and calculations, and those parsed into units, assigned initial values , and bought and sold on exchanges.
Now why would anyone want to buy or sell, or find value, in this completely fabricated currency, backed by nothing beyond distributed calculations? Where is hard real world value to back it? When salt used to be currency in China, you could actually use salt, the actual currency had value. Or when bread and barley were currency in Egypt, the actual currency — the actual unit had intrinsic real world value and use, outside of any exchange. The same with silver and gold. They have uses in building, in jewelry, in technology. The base of your monetary system historically (until the 20th century, and the rise of the stock market and the removal from the gold standard) had tangible physical applications and uses.
Now cut to cryptocurrency and it is a completely generated system, backed by nothing but random calculations, and the difficulty in breaking those calculations. And to be fair it can be argued it is just an extreme extension of how fiat money (Dollars, Marks, Euros) since the middle of the 20th century, is really backed by nothing but the whims of banking institutions and the might of a nations military.
So the question of why would anyone buy or sell digital currency/cryptocurrency becomes a somewhat moot one. From selling for pennies to now selling for hundreds of thousands of dollars, the last two decades has shown cryptocurrency , for better or worse, is here and does have value.
Now will it have value in the future? Which currencies will live, which currencies will die? Well while volatility is the name of the game when it comes to cryptocurrency, if you can get the human herd, the human train moving in a direction, like Buffalo stampeded toward a point, that herd tends to keep moving in that direction.
Whether that direction is a valley or a cliff.
Right now, that direction is cryptocurrency. And I say this as someone who does not as of this writing own cryptocurrency of any type.
So now you have various digital currencies doing very well, as in making people digital millionaires and billionaires, on these Digital Exchanges. But while Bitcoin is the most well known cryptocurrency, the last few years have seen an explosion of players in the market.
One of them is a company called Ethereum, launched in 2015. What I like about Ethereum, after researching it for this article is it is not just a currency derived from meaningless calculations, is it is a software company first, designing smart contracts, that can be stored and accessed across boundaries, and has developed its own programming language that other designers use to build their apps.
So the monetary system it has created, is an extension of how it is valued and paid for its work. So its unit “Ether”, can be seen to, at least for me, have some value beyond being only representative of random calculations, or being traded on a digital platform. I can actually without converting it to Dollars or Fiat money use it to actually buy something.
And here is where we come to NFT.
“What took you so long???!!!!”
“I hate this blog!!!!”
“Punk Ass Fool!!!”
Ah my loving public.
Now as i was saying… Ethereum, perhaps understanding that a digital currency, is of suspect import without digital products to spend it on, have created a new type of digital collectible, that people can create, buy, and sell.
Non-fungible Tokens are digital representations, copies of things, that have been encrypted and signed and limited to make them unique. And that is a completely bs definition so see the links above, for it competently explained. 🙂
From a business perspective they are ideal for contracts. For a commerce perspective they are ideal for creating something that is digitally unique, and therefore can be sold as scarce and collectible. In the physical world you can have an art gallery do a limited to 200 prints of say a famous Drew Struzan or Alex Ross painting, and collectors will pay hundreds to thousands to get that framed poster or print to put on their walls. As someone who has bought framed Alex Ross giclees and limited prints, I know of what I speak.
NFTs have taken that concept to the digital world, allowing owners of content to securely digitize their content, really just mark it saying this is a proven secure set limited to this number, and whether a photo, or a snippet of a video, or a painting (several Frazetta images have been made into NFTs and sold by his estate). allows them to sell it on exchanges. But you do not pay in dollars, you have to pay in digital currency.
It is actually a genius move on Ethereum’s part if you think about it. Digital Currency, for all the talk of decentralized this and that, is valued and viewed in dollars. Digital money viewed in its ability to be turned in for ‘real’ money. “Dude I bought these 100 Bitcoins 10 years ago, and now I’m rolling in Dollars B*tch!!” is the typical mindset of people jumping on the digital money train.
Ethereum is turning that on its head by creating markets, that do not want your dollars.
I’ll repeat that.
Ethereum is turning that on its head by creating markets, that do not want your dollars.
They want and accept Ether. Digital Currency.
I personally think NFTs are bs, to a large extent. However I think the creation of a digital infrastructure for these new digital millionaires to spend their digital money, without needing to convert it to dollars— it is absoeffing genius.
I who had very little interest, bordering on disdain for Crypto prior to starting research on this article, have to say I think Ether and Ethereum, that specific model, which other cryptocurrencies are now starting to copy, I think that bloody model is genius.
I have to be honest with you, if I had the money, I would go out today and buy me some shares of Ether.
If you want to, get info here!
Whether it goes up in the short term, whether it goes down in the short term, this is a company that is very smart, and forward thinking, way beyond just making Dollars— as silly as it sounds they seem true zealots on this idea— of not needing Dollars.
That makes them both scary and admirable, and a company to watch and get on the good side of.
And really quickly, because I’m going to get a lot of mumbling about my NFTs are bs comment. I’m an old school collector. I like my books on paper, I like my posters and prints, on my wall, I like my movies, Blu-ray, 3D, DVD, LaserDiscs, even this crappy packed, and relatively useless, 4K garbage in beautiful embossed cases on my bookshelf. I like my music on CDs, not listening to crappy compressed mp3s.
I understand why they created NFTs, it is an extension of creating valid and secure digital contracts, but its usage to create scarcity is concerning.
Why would i pay thousands for a digital print of something I can view digitally for free anytime I want? The answer is Collectors, my people, can be an irrational bunch. And collectors with more money than sense, can be an even more irrational bunch.
However, I do see the appeal of NFTs as a creator, if you can find a suck—ehh— a buyer for your product, you not only make money from the original sale, but you can code it into the item that you make money from subsequent sales. It is a capitalist wet dream made flesh.
But I can also see the downside to large scale NFT adoption. The cheap posters you can buy of great paintings or great movie posters may stop being made. The free images or sequences available on the web we will be in a lower quality. So now that NFT copy becomes a little more attractive due to a lack of real world alternatives. So that is the dark side of NFT adoption, that art and collectibles and culture starts becoming something that gets put behind a paywall.
But on the small scale, for the regular Joe or Jane or Joane that is monetizing and NFTing especially nice pictures they have taken, and there is a market, hey knock yourself out. Just be aware of the always suspect intersection of art and commerce.
Well guys that has been my overview on NFTs , hopefully you have found it as informative and fun to read as i did to research and write.
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There are a lot of books out there with the name Beksinski on em, and I’ve seen just about all of them.
Only two I consider must owns (feel free to use your Ether on em 🙂 ):
I was one of the first resellers of THE FANTASTIC ART OF BEKSINSKI over two decades ago. It was then, and remains now, one of my favorite artbooks. I sold out of all my copies a long time ago. But you can still pick up a few stragglers from other sellers on the link above.
This is just a softcover museum booklet to accompany one of the retrospectives on Beksinski’s work. I think it may be 40 or so pages, but printed on very nice glossy paper. Text is Polish, English & French and artwork is sublime.