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NFTs Are a Dangerous Trap

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Re: NFTs Are a Dangerous Trap

#401

Post by TheColorYellow »

wokwokwok wrote: post #250
TheColorYellow wrote: post #195

Earlier quoted context omitted.

> What is its potential? What can someone do with NFTs that they couldn't do before? The novelty comes from the underlying protocols that back the NFT. These protocols create marketplaces that are widely available and accessible and are reliably secure and robust. Take copyright for example. Copyright laws vary across regions and marketplace. The encoding and repudiation of these copyright laws is based on analog pro…

The point you’re making is valid, but you’re side stepping the key concern being raised. The tokens you acquire are worth nothing. Nothing about owning a token grants you any rights to anything other than what some other person is willing to pay/exchange it for. So if a game developer chooses to accept tokens, you can use them; but that developer can at any time choose to stop accepting tokens or a subset of tokens m…

Rephrasing your questions and critiques more broadly: What is the point of all this digital infrastructure if no one uses it? Why would anyone use it?

This is a more difficult question for NFTs as the market is even smaller than the financial use cases which has been driving blockchain applications. It'll take some time for seemingly legitimate and long-lasting value in areas for NFT to emerge as they are still being explored and developed.

However, no matter how you frame it, rhe value proposition for applications comes down to the value add characteristics of the networks they are built on top of.

> The tokens you acquire are worth nothing.

The tokens worth is determined by the market place that emerges around the tokens characteristics.

Some tokens are censorship resistant and run on globally accessible networks so that they are not easily erased, their ownership is easy to prove, and their history is reliably known. Some tokens are required to access other marketplaces or services because they have properties that make them more easy to use as traditional currencies. Some tokens allow for self-ownership paradigms.

Again, the tokens acquired carry the value of the characteristics of the networks in which they are issued. What these characteristics are valued as and actually "worth" in real economic terms is dependent on their demand.

> The “uniqueness” of the NFT is an illusion; it does not offer any strong guarantee of uniquely representing an actual asset.

This is only true if the NFT isn't accepted as value. If the characteristics I described earlier indeed do become valued, then the ledger which holds the claim i.e. the NFT will be taken as the source of truth for representing the ownership of the claimed asset. Its the theory of accounting applied to a different space.

Re: NFTs Are a Dangerous Trap

#402

Post by qqii »

Traster wrote: post #339
darawk wrote: post #320

Earlier quoted context omitted.

There is a reason. Just not a technical one. It becomes obvious when you ask the simple question: why hasn't it already been done? The answer is that it's in no actor's local incentives to create the public commons. Why is there no global market place for reselling digital event tickets? Certainly Ticket master and the other retailers could agree on an open standard protocol, pay for a centralized clearing house, and…

The example you give - reselling tickets, is actually something that is directly something ticket sellers want to discourage, crypto doesn’t solve that.

Why would that be so? My understanding is that they want to discourage scalping.

Digital tickets tied to digital identities that can only be transfered at market price. That's not a difficult smart contact to create.

Re: NFTs Are a Dangerous Trap

#403

Post by herbst »

jb775 wrote: post #101
Osmose wrote: post #10

Earlier quoted context omitted.

What property of NFTs has suddenly made them make money where previously they weren't? Like how did adding NFTs to the mix suddenly make their art start selling?

Well for one, NFTs on art create a unique money laundering strategy. Drug dealer buys an art NFT for $1k (using legit money), sells the NFT plus a bag of drugs to someone for $10k. They just made $9k in "artwork" profit, which is clean money....and since the value of art is always subjective, it can't really be questioned. On top of that, all monetary exchanges and transactions can be handled via smart contracts, so…

Yeah i am not going to buy relevant amount of drugs on something that has a visible public history when i easily cant.

I think you highly underestimate how liquid the crypto craze market really is.

Re: NFTs Are a Dangerous Trap

#404

Post by TheColorYellow »

dmitriid wrote: post #298
TheColorYellow wrote: post #237

Earlier quoted context omitted.

This same author can be seen here recommending blockchain technologies to the CA government here: https://www.govops.ca.gov/wp-content/uploads/sites/11/2020/0... If you're not willing to consider the hypothesis of value proposed by blockchain I can genuinely understand why and it makes sense. Lots of other areas to invest personal time and effort in.

> This same author can be seen here recommending blockchain technologies to the CA government here 404 page not found for me > If you're not willing to consider the hypothesis of value proposed by blockchain So, not even the value proposed by blockchain but the hypothesis of the value? What would those values and hypotheses be?

Search "govops ca kai stinchcombe" and you'll see the doc.

> So, not even the value proposed by blockchain but the hypothesis of the value?

Of course. This is a nascent and emerging market. To act as if this is anything but a hypothesis on what may be valuable is a lie. This is true of every emergent market ever.

> What would those values and hypotheses be?

See my other comments in this same thread if you'd genuinely like to engage in discussion. The value is derived from the characteristics of the network protocols and the hypothesis is these values are difficult to achieve without the protocol and that they will come to be highly desired.

As a simple example, take the oft common hate for Google accounts being deserviced. A globally accessible, immutable ledger representation of a user account could be a theroetic start in the direction of mitigating the problems of thirs-party owned account data.

Re: NFTs Are a Dangerous Trap

#405

Post by cbovis »

ZitchDog wrote: post #377
newsclues wrote: post #365

Earlier quoted context omitted.

If I’m in ticket selling business, if I can maintain a level of control with crypto I can, but back tickets and resell them, but most importantly I can capture any upside I missed by selling the tickets for too low of a price, and the purchaser resells the tickets for a profit given I get a cut of each and every transaction

How do you guarantee the person trying to get into the event is the owner of the ticket?

They can verify ownership by signing something with the wallet that the token is associated to (signing is free). They're only able to do so if they own the private keys of the wallet.

It should be noted that private keys can be shared if the owner wishes. In the case of using NFTs as event entry the event organizer would still need to keep a record of which NFTs have been used already for a given event because the wallet can be shared. Third party services will almost certainly pop up to fill this need.

Re: NFTs Are a Dangerous Trap

#406

Post by herbst »

dgellow wrote: post #252

Regarding the energy use: Since the 1st of March Cardano has native tokens (you can create your own token without the need for a smart contract) and multi-assets (wallets and transactions can contain more than one asset). The blockchain is using Proof-of-Stake and a full node runs on a raspberry pi 4. So it is completely possible to have NFTs without the massive energy consumption of Ethereum and without the very hig…

Adding to this most newer smart chains are kinda like that plus even ethereum 2.0 is going in that direction

Re: NFTs Are a Dangerous Trap

#407

Post by qqii »

AlunAlun wrote: post #350
jamesgreenleaf wrote: post #37

NFTs make perfect sense for representing a claim on things that can be used, like event tickets or in-game virtual goods. But as certificates layered on top of collectibles... I'm not so sure. With something like CryptoKitties, you can do something with the tokens (play a virtual pet game). But with something like CryptoPunks you're essentially paying for digital beanie babies, which are worse than real ones since an…

> in-game virtual goods. But as certificates layered on top of collectibles... I'm not so sure. I agree - the problem with most NFTs at the moment is that you can't actually do anything with them, apart from trade them. There are games coming out now (e.g. Goal Revolution[0]) where your NFTs' properties (and, by extension, value) change based on what you do with them (how you use them). If the NFT thing is going to h…

> the problem with most ~NFTs~ art at the moment is that you can't actually do anything with them, apart from trade them.

I dot agree with this statement but perhaps it'll help you expand why you think this way. As the article says, you don't have to own the Mona Lisa to appreciate it's beauty.

Re: NFTs Are a Dangerous Trap

#408

Post by herbst »

cwkoss wrote: post #300

Has anyone done an analysis of NFTs being used for money laundering? Seem like they'd have most of the benefits of art plus most of the benefits of crypto. I suspect NFTs will continue gaining in popularity, if only for this alone.

Why? Trading histories for NFTs are usually fully public. There are so many other things like ponzi smart contracts that move millions every day that using NFTs doesnt sound so appealing

Re: NFTs Are a Dangerous Trap

#409

Post by TeMPOraL »

qqii wrote: post #402
Traster wrote: post #339

Earlier quoted context omitted.

The example you give - reselling tickets, is actually something that is directly something ticket sellers want to discourage, crypto doesn’t solve that.

Why would that be so? My understanding is that they want to discourage scalping. Digital tickets tied to digital identities that can only be transfered at market price. That's not a difficult smart contact to create.

Scalping is also selling tickets at market price - after first making sure the market price is a big multiple of what it was before scalpers got to work.

Re: NFTs Are a Dangerous Trap

#410

Post by ryanbrunner »

sygma wrote: post #370
ShinTakuya wrote: post #349

Earlier quoted context omitted.

This argument has some flaws. So firstly, if nobody got on the bus, the number of buses on the route would be reduced, and depending on circumstances the route would be cancelled. Additionally, the weight of the passenger does slightly increase the power requirement. Ignoring that, while there's minimal direct effect of usage, ultimately the bus is only there due to demand. Similarly, for block chains, mining only oc…

> Similarly, for block chains, mining only occurs when the thing being mined has value. NFTs would not be mined if people weren't using them. Therefore I would absolutely call them an ecological disaster. The point is that energy consumption due to mining on the Ethereum network does not scale with transaction count. So it does not matter if NFTs are issued ("minted") or not. They add no marginal energy cost in the m…

What they're saying though is that if no one was using Ethereum (for NFTs or other purposes), there would be zero reason to mine them in the first place. It seems to follow to me that as demand goes up, the supply will increase in turn, since it's seen as a more attractive thing to mine.
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