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NFTs Are a Dangerous Trap

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Re: NFTs Are a Dangerous Trap

#481

Post by analog31 »

j4yav wrote: post #214
analog31 wrote: post #55

Earlier quoted context omitted.

I actually had a similar idea, last time the theft of a famous painting was reported in the news. The museum could offer a deal, where they get the painting back but give the thieves a certificate for it. As part of the deal, they have to hang a sign next to the painting, saying, "This painting is considered to be stolen." The thieves can do whatever they want with the certificate -- use it to pay illicit debts and s…

Couldn’t the thieves just make a new NFT blockchain that says they own whatever they like and skip the messy steps in the middle? You’d end up at the same end state where the museum has a painting and the thieves have a certificate that says they own it.

Since the theft is newsworthy, it would be clear that only the first NFT was genuine.

Re: NFTs Are a Dangerous Trap

#482

Post by jerry1979 »

If Alice buys art from Bob, and that art goes up in value due to the open-market activity of anonymous [Carol?, ...], then Alice can donate that now expensive art to a digital museum for a tax write off. Where could Alice get the NFTs appraised? Is the open market activity sufficient?

It's almost like the NFT system allows proles to do fancy tax write-offs like their bourgeoisie cousins.

Re: NFTs Are a Dangerous Trap

#483

Post by analog31 »

smt88 wrote: post #147
analog31 wrote: post #55

Earlier quoted context omitted.

I actually had a similar idea, last time the theft of a famous painting was reported in the news. The museum could offer a deal, where they get the painting back but give the thieves a certificate for it. As part of the deal, they have to hang a sign next to the painting, saying, "This painting is considered to be stolen." The thieves can do whatever they want with the certificate -- use it to pay illicit debts and s…

> The thieves can do whatever they want with the certificate -- use it to pay illicit debts and so forth. They can visit their painting at the museum, and brag to their friends about it. But the rest of the public still gets to enjoy the painting too. I love this answer because it's a perfect analogy to explain why NFTs are total nonsense. Owning a one-of-a-kind, literally irreplaceable painting cannot be substituted…

Note that I wouldn't endorse owning a person, but whether they have the same value is a matter of whether they have the same utility. Leaving the painting in the museum might make the certificate more valuable for all we know, because it ensures that the painting will be stored properly and not forgotten by the public.

Honestly I didn't even think about a definition of ownership when coming up with my idea.

Re: NFTs Are a Dangerous Trap

#484

Post by meowface »

runeks wrote: post #244
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…

> You can brag about owning such-and-such an image [...] How? You don’t own a (digital) image. You own a token that references an image. Everyone else can view the image and send it to their friends. But you have some token allegedly signed by the author of the image — who cares?

You're correct, though if I understand correctly, some NFT platforms do provide some (centralized) feature for "unlocking" content. For example, you could upload a full resolution art piece to an NFT platform or any other place and have the server serve the content to any request that proves ownership of the token.

This is a pretty terrible system, though, as it's completely off-chain and not "Web 3.0" or decentralized in the slightest. The server has to store the "private" content in a private centralized database, so the server owners also can access the content, and any hacker could access the database and publicly dump all of the supposedly token-walled content.

It's just taking advantage of the fact that any computer can determine the Ethereum address that owns a particular token and can check to see if a message was signed by that address's private key.

I could imagine a future standard that could maybe integrate this into Ethereum proper, though I'm not sure if it's technologically possible.

There's no way to prevent someone from just publicly releasing the art, but one could imagine some system like the full resolution piece stored as a public key-encrypted blob in the blockchain which can only be decrypted by a token holder.

Maybe upon token ownership transfers the key could be encrypted with the token buyer's Ethereum address public key, though I'm not sure how or if it could work since I think the original content key would have to stored on the network in some fashion in order to later encrypt the key for token owners. So it might not be possible even in theory, though I don't know nearly enough about Ethereum and cryptography to say with any certainty.

Re: NFTs Are a Dangerous Trap

#485

Post by electriclove »

frobisher wrote: post #437
krsdcbl wrote: post #435

I don't quite get this post, it somehow seems to make a case FOR nfts and then try to make the point that these are not look likr stocks (which is rather obvious). The whole point of nfts is to create uniqueness among endlessly duplicatable media, and provide the possibility for digital art to be handled like physical art. Just like the Mona Lisa, you can look at endless photos of it without restriction, but only one…

The Mona Lisa is a physical "rivalrous" good, meaning if I own it, you cannot. Digital goods are "non-rivalrous", so although NFTs can give a psychological feeling of ownership, I wouldn't say they make digital goods rivalrous. I think digital NFTs only make sense in two ways: (1) psychological feelings of ownership, (2) perhaps a claim on something digital that _can_ be made rivalrous, for instance royalty streams.…

Scarcity and print # allow for making them rivalrous (e.g., only 200 numbered cards).

Royalty models have been tried where the owner of the original receives 90% of the sale of a digital print. See eulerbeats.com

Basically, I agree with your points and there are already active efforts in these areas that will make some NFT efforts very viable.

Re: NFTs Are a Dangerous Trap

#486

Post by sp332 »

lottin wrote: post #456
detaro wrote: post #353

Earlier quoted context omitted.

> Let's say I buy a NTF $1000 and get a digital copy, what prevents me (barring legalities) to perfectly duplicate it and massively redistribute it (not the token, the distributed supposedly high quality file) for a fraction of $$$ and turn a profit The file is usually publicly accessible, why would anyone give you money for something they can just download?

Some rich dude has bought the "first tweet" for $2.5 million, despite the fact that it's publicly accessible [0]. I imagine it's about showing off how rich they are. They could achieve the same result by throwing $2.5 million into a furnace. https://twitter.com/jack/status/20

I don't think that's the question. That guy paid for the exclusive NFT thing, but no one else is going to make a profit selling cheap copies of that tweet.

Re: NFTs Are a Dangerous Trap

#487

Post by aklein »

ThomPete wrote: post #470
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…

This always comes down to how you understand value. How valuable is Jimmy Hendrix guitar pick? How valuable is a lok of Justin Biebers hair? How valuable is a book owned by Charles Darwin? Of course NFT is a bubble just like about every other thing humans create, but humans will always attach value and meaning to dead things even digital ones. And so NFTs can be used for many things including allowing people to buy s…

Only in this case the value is stored in “digital gold”. Unlike gold, which is chemically stable, I’m far from convinced the digital format itself will end up sticking around long term.

Re: NFTs Are a Dangerous Trap

#488

Post by electriclove »

iambateman wrote: post #444

Consider baseball cards. I own 5000 cards with a total value of about $50. A few NFT’s will be very very valuable. The first one George Clooney sells. The first one ever created. The 6 Banksy sells under a pseudonym that no one realizes for a year. The song Taylor Swift limits to 1 copy. But almost all of them will be worthless. The difference between baseball cards and NFT’s is that for generations, no one really ca…

As a fellow former card collector, I can emphasize although I don't think the result will be as extreme as you've laid out. It all comes to supply and demand. If Taylor Swift could create 1,000 NFT prints for $10 each for each of her songs, they would be sold immediately.

Re: NFTs Are a Dangerous Trap

#489

Post by snarf21 »

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…

NFTs are nonsense and just as much a pyramid scheme as everything else crypto. People will get left holding the bag at the top just like with CryptoKitties. I have several hand painted reproductions of famous paintings (impressionist). I get just as much enjoyment looking at them on my wall as I have at the museums looking at the real ones. I don't need to have $100M. I'm glad that content creators are getting paid now but remember that most "artists" end up penniless and their art is only highly valued posthumously.

Re: NFTs Are a Dangerous Trap

#490

Post by electriclove »

gorgoiler wrote: post #271

The huge USD value of this market seems odd. It either points to how rich these cryptocurrency holders are, or how illiquid their market is. It’s all very well having 18.78Ꮆ (gorgcoins; ~$687,441) but if all you can do with them is buy 18.78Ꮆ of Cryptotchotchkees then it doesn’t seem like such a big deal. I guess, if you’re stuck with an exit, what you really need to do is to make some kind of a market for some new p…

NBA Top Shot runs their own very liquid marketplace (when it is, cough, up). It is 100+ times more liquid than selling physical cards on Ebay.

Yeah, if you buy some random crypto art, you may be stuck with it just like in real life.

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