NFTs Are a Dangerous Trap • Hacker News Board

Re: NFTs Are a Dangerous Trap

#671

Post by quantified » Sun, Mar 07, 2021, 9:22 PM UTC

tablespoon wrote: post #592

fredfoobar wrote: post #571

Earlier quoted context omitted.

What's the other proof of ownership? NFTs are the digital equivalent of a vehicle title, that's the strongest usecase (proof of ownership), IMO. I'm not too keen on the collectibles/art usecases, they're probably the easiest/low-effort ones.

> NFTs are the digital equivalent of a vehicle title, that's the strongest usecase (proof of ownership) No they aren't, and least not until they're recognized by law as such.

Right, analog of a purchase receipt is maybe a better way to put it.

Re: NFTs Are a Dangerous Trap

#672

Post by K0balt » Sun, Mar 07, 2021, 9:28 PM UTC

snarf21 wrote: post #489

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 n…

The underlying thing has to be already considered valuable. Consider tokenized single cask scotch.

So, it's made, and costs 150 a bottle. Why? Ostensibly, it's good scotch whiskey, and it's a limited run, 10 years in the making.

So why tokenize it?

Gamification.

Only people with the actual bottle can play.

Open it, scan the qr under the cap, then you can share the official tweet from posh-makers whisky announcing the opening of the bottle.... "that was us last night, good times all around!" maybe you get a 25 dollar certificate for your next limited run bottle. It's a social flex, and it's great publicity for the brand.

...and the remaining 237 bottles just went up in price. Fast forward a few years, and somebody has one of the last three bottles.... Which is mostly because he can actually prove he has one of the last three. Now its worth 270k.

Re: NFTs Are a Dangerous Trap

#673

Post by K0balt » Sun, Mar 07, 2021, 9:31 PM UTC

imtringued wrote: post #657

gruez wrote: post #612

Earlier quoted context omitted.

But the same dynamic exists with NFTs. The issuers can limit supply to ensure value for collectors.

Physical goods have a counterfeiting risk. Is it possible to use NFTs to prevent counterfeiting by verifying that a product is genuine? If not then they really have no use. Physical goods need verification but digital goods can be replicated perfectly. A "bootleg" is just as good as the original so no verification is needed.

Yes. That is precisely one of their best uses.

I'm a dev at pruf.io and this is one of the many things our platform is designed to do.

Re: NFTs Are a Dangerous Trap

#674

Post by K0balt » Sun, Mar 07, 2021, 9:32 PM UTC

theptip wrote: post #566

snarf21 wrote: post #489

Earlier quoted context omitted.

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 n…

Worth noting that NFTs aren’t just cryptokitties; there is a lot more you can do with them. ETH NFT refers to the smart contracts that you would use to digitize ownership of a house or any other (physical or financial) unique asset that you might trade. You can nest an NFT under an ERC20 token, too, so that you can sell partial ownership tokens in your NFT. Of all the use-cases in crypto, I think digitizing ownership…

That's what I think too, which is why i started pruf.io

Re: NFTs Are a Dangerous Trap

#675

Post by op00to » Sun, Mar 07, 2021, 9:36 PM UTC

K0balt wrote: post #672

snarf21 wrote: post #489

Earlier quoted context omitted.

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 n…

The underlying thing has to be already considered valuable. Consider tokenized single cask scotch. So, it's made, and costs 150 a bottle. Why? Ostensibly, it's good scotch whiskey, and it's a limited run, 10 years in the making. So why tokenize it? Gamification. Only people with the actual bottle can play. Open it, scan the qr under the cap, then you can share the official tweet from posh-makers whisky announcing the…

Why is it worth 270k? It could also be worthless. It could be worth a little.

Re: NFTs Are a Dangerous Trap

#676

Post by SideburnsOfDoom » Sun, Mar 07, 2021, 9:40 PM UTC

cachvico wrote: post #666

SideburnsOfDoom wrote: post #589

Earlier quoted context omitted.

> The enforcement, interestingly, is more traditional; Ah, so they pinkie swear not to do it a second time?

It would be equivalent of Sotheby's starting a second brand competing with themselves, but yes.

Sotheby's was founded in 1744 (1). They have a track record, a _brand_ to maintain.

Your average blockchain was founded recently, and have a lot less to lose taking the money and running, or popping up again under a new name, for a second go at the same shtick.

1) https://en.wikipedia.org/wiki/Sotheby%27s

Re: NFTs Are a Dangerous Trap

#677

Post by blockyhead » Sun, Mar 07, 2021, 9:40 PM UTC

arcticbull wrote: post #119

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 make perfect sense for representing a claim on things that can be used, like event tickets or in-game virtual goods. There’s absolutely no reason for that to be decentralized, only one party can honor the tokens anyways. Like most things crypto they don’t actually make sense for anything.

Yes there is. If it is decentralized (properly), you can't be canceled or locked out of your account, you can trade your good at any time.

Re: NFTs Are a Dangerous Trap

#678

Post by SideburnsOfDoom » Sun, Mar 07, 2021, 9:42 PM UTC

knowaveragejoe wrote: post #644

lottin wrote: post #610

Earlier quoted context omitted.

But when you buy a baseball card you get a card. Here it seems that you only get a receipt stating that you have paid (aka the certificate) AND NOTHING ELSE.

If I understand it correctly, that receipt in conjunction with your keys allows you to prove you own the NFT and can control it on the blockchain(sell it, trade it, etc).

If you have essentially bought a jpeg image, you have as much control over it as anyone else: Anyone can view, transmit or edit it, etc. Your "proven purchase" grants you exactly nothing extra.

Re: NFTs Are a Dangerous Trap

#679

Post by Dylan16807 » Sun, Mar 07, 2021, 9:45 PM UTC

iudqnolq wrote: post #650

Dylan16807 wrote: post #635

Earlier quoted context omitted.

If first sale doctrine is ever fixed, your friend could sell you their copy that way. I don't know why all your examples involve third parties stamping sweet nothings onto a piece of paper. Of course something made by a non-author and with no ownership is useless. I said that in my first comment. > If the NFT doesn't come with conventional legal rights, you don't own the thing the NFT points to in the real legal syst…

> If first sale doctrine is ever fixed, your friend could sell you their copy that way. Yes, but NFTs claim to get similar effects without changing the law. > I don't know why all your examples involve third parties stamping sweet nothings onto a piece of paper. The third party is the blockchain. Because the blockchain can't enforce that you actually hand over real ownership rights to correspond with the NFT ownershi…

> If I own a piece of paper my country's legal system will accept as meaning I own something, why would I also want a piece of virtual paper that a bunch of people on the internet will accept as meaning I own some sort of rights to something.

So you can buy and sell it easily, and show everyone that you own it.

That's much better than paper!

> What NFT can I use to make a contract that any real legal system will accept?

Surely they have terms of service? That's where the legal system ties in.

Re: NFTs Are a Dangerous Trap

#680

Post by knowaveragejoe » Sun, Mar 07, 2021, 9:47 PM UTC

lottin wrote: post #667

knowaveragejoe wrote: post #644

Earlier quoted context omitted.

If I understand it correctly, that receipt in conjunction with your keys allows you to prove you own the NFT and can control it on the blockchain(sell it, trade it, etc).

But the NFT is the receipt, if I understand correctly. You own a receipt (the NFT), and you can trade it, but why are people buying and selling receipts? You make a payment, you get a receipt, and nothing else, which makes absolutely no sense. Usually, when you buy something you get a receipt for free and then the actual thing that you have bought.

I think at that point the platform upon which the receipt resides will prevent people from making duplicates on their chain, and the owner of the receipt have control over buying/selling it.