If you’re buying NFTs with hopes of profiting from them, i.e. as assets, you’re an idiot. If you’re buying because it’s silly, funny or otherwise makes you happy, go for it. No scam there.
If you’re playing middleman, frankly, I think you’re wasting your life, but then I don’t see how you’re so different from an art dealer or auction house. At any rate, you’re probably a better allocator of those dollars than whoever gave them to you. (Exception: if you’re pitching NFTs as investments to unsophisticated investors, you deserve to be prosecuted.)
All that said, NFTs do something similar to what much of fine art and religious prohibitions do: demonstrate group membership by submitting to arbitrary prohibition and sacrifice requirements [1] with the aim of accessing club goods [2], e.g. in-group access and standing. When someone calls NFTs a scam, they’re saying those club goods are worthless. Objectively, as a crypto sceptic, the wealth made by crypto insiders would appear to reject that hypothesis. (Whether buying an NFT or expensive painting alone confers those club goods is a separate question.)
> If you’re buying because it’s silly, funny or otherwise makes you happy, go for it. No scam there.
I think there's a significant group who are buying because under their understanding of what NFTs are, they're silly/funny/make them happy, but that they are mistaken about what NFTs are.
Arguably if it's bringing them joy, who cares, but at some level this is still a scam.
I feel like most people see the art dealing world for what it is: a clout-chasing game that’s basically a scam. And I hear some NFT people take the stance of “yeah art dealing is a scam, but it’s going to happen anyway, so I might as well make some money.”
Which is all well and good in a sense, I’m not gonna cry over rich people spending their money on bs. But it’s also the case that if you take this position, you do abdicate any ability to advocate for NFTs as something other than a scam. And if you try and flip this around and argue that “art dealing is a legitimate business actually”, people will (correctly) look at you weird.
As an artist I would love to sell something for $69M. But I have not yet put a single item up for sale as an NFT as it seems so silly, you are selling a node in a merkle/patricia/etc tree, not a piece of art. The NFT art that is actually generated when you pay for it (and lives entirely in the blockchain), such as the bored apes, etc, is mostly predrawn parts assembled randomly; i.e. digital Potato Head toys. Some are based on interesting algorithms, but that has nothing to do with blockchains or crypto (other than using the hash as the random seed). I would rather create art (I do generational art as part of my work) on my own time and with my own tools. I would also prefer to sell art that people can put on their walls.
Some of what I see people selling for 10ETH are so unimaginative. But then again people in the past bought rocks as pets, so there is always someone with too much money and no sense...
Art itself is often overpriced, but it has a long history of increasing in value over time (since generally it is only made once and the artist eventually dies), and is a legit investment (and often handy for money laundering but then so is real estate and even startups). But NFTs are mostly uninteresting art, can be made in huge quantities with no work by an artist, and have no useful value other than bragging rights I guess. Museums who want to display NFTs are seriously hilarious.
Some NFTs are made by real artists who actually work hard on the works, but very few make any money at all (Beeple for example is a hard working real artist who got lucky) since NFT people seem to only gravitate to the auto-generated things like the apes.
Yeah, I’ve noticed this too. I feel like a lot of people in the NFT space have a pretty nihilistic view of art (i.e. “all art is worthless, so these procedural mix-and-match apes are as good as anything else”). They’re correct that the value assigned to art is often arbitrary, but the thing is that once you acknowledge that, the correct response isn’t to start buying random crap for thousands of dollars, it’s to buy things you want in your life for hundreds of dollars.
Like, would I pay $100 for a super high quality 2ftx2ft print of a diagonal gradient with two really well chosen colors? Yeah, possibly, if I thought it would look nice in my living room. Would I pay even $10 (let alone thousands) to “own” a PNG of that gradient in some abstract sense? Absolutely not.
Most of these arguments apply to recently produced art in general, don't they? Historical art is a little different, being a kind of combination of antiques and arts.
Art also has no intrinsic value. Art is also used for money laundering. When you buy art, you don't own the copyright, you just own the original production. The copyright owner can continue to manufacture prints and reproductions, but they are worth a fraction of the original. If it were possible to create one, an exact atom-for-atom duplicate of a piece of art would likely also only be worth a small fraction of the "original".
Even weirder, nowadays, much art doesn't really have an "original" as it was produced electronically in the first place - so what does owning the original even mean? Is it really an original, or is it just a blessed instance that everyone commonly understands as the one with value?
Arguably NFTs distill the essence of art ownership into its core proposition: you become the owner of intangible that is commonly understood by all market participants to truly represent the artwork and is valued as such.
The NFT market is odd, but the art market is odd in general.
> Most of these arguments apply to recently produced art in general, don't they? Historical art is a little different, being a kind of combination of antiques and arts.
But none of your arguments apply to 'art in general' at all, do they? Because when you "buy art" you are actually... buying a piece of art.
The way we value 'art' obviously has culturally historical oddities attached to it. But none of them are comparable to what people are paying for when 'buying' NFTs (ie: their name in a database).
You're not just buying "a piece of art" though. If that was the case, duplicates/prints/casts/reproductions or whatever would be worth a substantial portion of the original, relative to their true-ness.
The value in owning art isn't the physical object. The value comes from how owning that specific physical object means you "own" that art, whatever that means. I don't really understand why anyone would care about that either, but people clearly do.
And even if you disagree with that point, the other points about not owning copyright, lack of intrinsic value and using art for money laundering definitely apply to real art too.
>But none of your arguments apply to 'art in general' at all, do they? Because when you "buy art" you are actually... buying a piece of art.
It's naive to think that the majority of the value of buying a painting of a pure black square comes from having the physical painting itself rather than almost exclusively out of the story and recognition by others. Once you recognize that it's not so hard to see that you can remove the physical painting aspect altogether.
Eh, I can see a difference between commissioning a new piece (or likewise attending a live performance or a cinema) and spending the cost of the average U.K. home on William Shatner’s prop phaser: https://www.today.com/popculture/william-shatners-star-trek-...
Sure (plus inheritance tax funk, which I learned thanks to my dad’s stamp collection), except:
> If it were possible to create one, an exact atom-for-atom duplicate of a piece of art would likely also only be worth a small fraction of the "original".
Is a hypothetical for now.
I don’t get most of the famous artists — Picasso, The Beatles, Shakespeare and so on all seem overrated to me — but high-value original works are mostly that way because they are distinguishable from copies. I expect atomically precise duplicates would destroy the market for collector items unless you can re-attach scarcity in some way.
I imagine you're correct that if a theoretical perfect duplicator existed, the physical art market would be destroyed, but only because there would be no way of authenticating the original. The original still has value if you could prove it, but nobody would know which one the original is.
Let's say this theoretical duplicator was perfect in every way EXCEPT you could tell it wasn't the original because the isotopic signatures didn't match. That is, for all intents and purposes, each duplicate is exactly the same but each instance encodes an unreproducible signature that can be used to identify it.
I postulate the original would still carry an enormous value relative to the exact duplicates.
>Like all crypto scams, the essence of the NFT grift is in recruiting new believers by convincing them a blessed database is an authoritative registrar of value. Just like star naming the grift isn't about utility it's simply a shared delusion in a get rich quick scheme.
I think this gets to the core of why so many people (like the entirety of Hacker News) seem to irrationally hate NFTs, to the point of posting about it almost every day instead of just ignoring it.
There are shared delusions that are useful as social coordinating forces. Religions are generally this. Social justice is this. And crypto is also this. I find that a lot of the irrational hatred for NFTs and crypto in general tends to come from people who hold certain shared delusions and who don't like that another competing one is so successful at coordinating behavior.
There are plenty of NFT platforms that are not about getting rich quick yet no one talks about them because it doesn't fit their narrative. This leads me to believe that what I said is correct, rather than you said.
It was obvious from the start that all this NFT market is pure nonsense, but it is nice that someone takes time to clearly explain why. Maybe it'll save some innocent souls from losing their money.
That bunch of people is not going to make significant amounts of money, they will take significant amounts of money from other people, giving nothing in return.
I believe that in English language fraud is an appropriate word for such enterprises.
I mean people literally buy "property" and space ships in virtual game worlds. NFT are no different, it's microtransactions but for rich people.
Is it a scam? well it depends whether the elite values NFT or not... it certainly is a speculative "asset" by nature.
It's not a scam provided people know what they are exactly buying. It's more of yet another "get rich quick" scheme for some.
However, beyond the speculative aspect of NFT, artists need to know that putting their art in a virtual gallery as NFT WILL COST THEM money, so the business model for the middle man is to make artist believe that they will make money from NFT. The house always wins...
There's more of tangeable value from buying property in virtual game worlds in the sense people get to use those property or items when normally in the game they would not be able to.
For things like ship preorders on Star Citizen it's much more of a risk that the value will ever be delivered but it's still offers more than just a note of ownership of an abstract token on a blockchain sequence.
If someone decides to honor these tokens as proof of ownership of property/items in the real world/ a virtual world then they may offer some value but there's a very great risk that will never happen.
IMO, someone’s tangible value of putting an Ape as their avatar pic on social media might be greater than that of someone being able to use a ship purchased in Star Citizen.
It’s a little crazy to me how Twitter profiles with Apes are viewed as “influencers” and “pioneers” and get treated as such. Not my cup of tea per se, but there is tangible value for some people there.
Space ships and virtual property is virtual property, at least you got something. Something to look at maybe, something that distinguishes you in game?
NFTs give you NOTHING. They don't give you the right to anything. All you own is a (hopefully) unique cryptographic sequence.
If you think of Cryptopunks (or whatever) as a game then buying one gives you as much or more in the context of the game as buying a skin or a plot of land in the context of another game.
>Something to look at maybe, something that distinguishes you in game?
You pretty obviously get that here, too. I honestly don't see why you'd think it gives you less other than out of general dislike for NFTs.
People are still saying this about cryptocurrencies too.
Many people also say EVs and green energy are a scam.
People also frequently accuse public companies of being scams or trash (there's a certain intersection between the previous sentence here).
Healthy skepticism is a powerful weapon of thought. But you have to be able to acknowledge where skepticism ends and stubborn refusal to accept reality starts.
Humans value certain things. They may not be the same things you value. That doesn't necessarily mean they're just "a giant scam".
Yeah I’m totally with you. I think many of us had a similar reaction the first time NFTs were explained to us. But the not I learn about them, an see them in action, it’s definitely starting to make more sense.
This (very uninteresting) Twitter rant doesn’t really make any good arguments. The comparison to ‘star naming’ services is very contrived & makes absolutely no sense.
Yeh but sometimes what people value and like is a scam. You know, some people do like certain MLM brands or even cults, that doesn’t mean those aren’t scams/cults. Stop trying to normalize predatory behavior and institutions under the banner of “people value different things”
> You're buying an expensive entry in someone else's database
Nope, you're buying a non-fungible token on a public ledger where the data and association with a specific address (or addresses) can be read without permission. This ownership and permission can then be moved around (potentially for large sums - potentially for near-zero amounts) by means that are independent of the client used. So for instance an NFT could give me access to an exclusive Discord channel (the client here being a Discord bot) and I could potentially sell or otherwise pass that onto someone else who wants access. The ownership of that token could also afford me access to, for instance, buying another token on another smart contract (the client here being another smart contract).
That they are commonly linked to metadata associated with JPEGs is really missing the opportunity here.
Furthermore, since everything's on a public ledger the much-stated money laundering is surprisingly difficult. And in fact multiple people have been caught out by this (a simple example being one of OpenSea's PM's wallets showing that they were frontrunning; another is VCs front-running their portfolio companies' air drops). That NFTs are often exchanged between bot accounts and multiple wallets (often tracked back to known individuals) to pump prices is also well-known and visible on the blockchain.
Whether or not you think expensive JPEGs are 2020s' Beanie Babies, it's hard to imagine a programmer on HN not being able to think of interesting non-JPEG things to do with an open source, public and permissionless ledger/database.
EDIT: disclosure - I have some JPEG NFTs. They weren't super expensive to me but I bought them so I had skin in the game that forced me to investigate this market rather than shouting "but money laundering!" from the sidelines. I'm glad I did this. Via getting into the weeds I've discovered a vibrant and super interesting ecosystem of developers, entrepreneurs, cryptographers and opportunities I'd never have known about otherwise. Are my JPEGs worth it? Doubt it. But the experience has been super interesting so far.
> it's hard to imagine a programmer on HN not being able to think of interesting non-JPEG things to do with an open source, public and permissionless ledger/database.
You underestimate the extent at which working-for-a-living has utterly destroyed my sense of imagination and ability to have an original thought.
> it's hard to imagine a programmer on HN not being able to think of interesting non-JPEG things to do with an open source, public and permissionless ledger
The history of cryptocurrency is exclusively people trying to come up with ideas for this extremely interesting class of data structures, yet consistently only reaching variants of "fraud." (And, those people who just jump immediately to fraud without much thinking.)
There's some truth in what you say. But then same also applies to a lot of tech startups for instance (we could pick many but let's say Thaneros)... in fact it's true of the wider financial system. Just check out the latest HSBC news in the last week.
The problem is that people find it easy to jump to "money-laundering! beanie-babies!" and not spend the time thinking about what they might want to do with the tech. Strikes me as a bit curmudgeonly versus the optimistic, open-minded and innovative roots of HN...
How is this "someone else's database"? It's literally a 100% public permissionless ledger. If I store an NFT in Facebook's database is that not "someone else's database" by definition.
How _could_ an NFT give me exclusive access to a Discord channel? I see how it could let me read some sort of access token that I could use, but I dont see how it would prevent others from seeing/using that same token, particularly those who have previously owned it.
You sign a message containing your Discord username with the address that's registered as owner of said NFT. The bot then approves your Discord account, while also watching for changes in NFT ownership to revoke your access if you transfer the token out.
It's pretty common to do this for Patreon rewards so it's not really much different to how you'd approach that except instead of connecting to their API it does it using the records on chain.
You'd run a bot or similar on Discord that would grant you a role to access the channel and it would use your wallet to verify your identity (ala public key crypto) and the ownership of the NFT by your wallet to verify the permission to join.
Most of the time you're a centralized thing anyway in this case so the NFTs don't really add much (unless you want users to be able to trade access) even if you wanted to take payment via crypto-currencies.
Readit News
If you’re playing middleman, frankly, I think you’re wasting your life, but then I don’t see how you’re so different from an art dealer or auction house. At any rate, you’re probably a better allocator of those dollars than whoever gave them to you. (Exception: if you’re pitching NFTs as investments to unsophisticated investors, you deserve to be prosecuted.)
All that said, NFTs do something similar to what much of fine art and religious prohibitions do: demonstrate group membership by submitting to arbitrary prohibition and sacrifice requirements [1] with the aim of accessing club goods [2], e.g. in-group access and standing. When someone calls NFTs a scam, they’re saying those club goods are worthless. Objectively, as a crypto sceptic, the wealth made by crypto insiders would appear to reject that hypothesis. (Whether buying an NFT or expensive painting alone confers those club goods is a separate question.)
[1] https://www.nber.org/system/files/working_papers/w6715/w6715...
[2] https://en.m.wikipedia.org/wiki/Club_good
I think there's a significant group who are buying because under their understanding of what NFTs are, they're silly/funny/make them happy, but that they are mistaken about what NFTs are.
Arguably if it's bringing them joy, who cares, but at some level this is still a scam.
Which is all well and good in a sense, I’m not gonna cry over rich people spending their money on bs. But it’s also the case that if you take this position, you do abdicate any ability to advocate for NFTs as something other than a scam. And if you try and flip this around and argue that “art dealing is a legitimate business actually”, people will (correctly) look at you weird.
Some of what I see people selling for 10ETH are so unimaginative. But then again people in the past bought rocks as pets, so there is always someone with too much money and no sense...
Art itself is often overpriced, but it has a long history of increasing in value over time (since generally it is only made once and the artist eventually dies), and is a legit investment (and often handy for money laundering but then so is real estate and even startups). But NFTs are mostly uninteresting art, can be made in huge quantities with no work by an artist, and have no useful value other than bragging rights I guess. Museums who want to display NFTs are seriously hilarious.
Some NFTs are made by real artists who actually work hard on the works, but very few make any money at all (Beeple for example is a hard working real artist who got lucky) since NFT people seem to only gravitate to the auto-generated things like the apes.
Like, would I pay $100 for a super high quality 2ftx2ft print of a diagonal gradient with two really well chosen colors? Yeah, possibly, if I thought it would look nice in my living room. Would I pay even $10 (let alone thousands) to “own” a PNG of that gradient in some abstract sense? Absolutely not.
Art also has no intrinsic value. Art is also used for money laundering. When you buy art, you don't own the copyright, you just own the original production. The copyright owner can continue to manufacture prints and reproductions, but they are worth a fraction of the original. If it were possible to create one, an exact atom-for-atom duplicate of a piece of art would likely also only be worth a small fraction of the "original".
Even weirder, nowadays, much art doesn't really have an "original" as it was produced electronically in the first place - so what does owning the original even mean? Is it really an original, or is it just a blessed instance that everyone commonly understands as the one with value?
Arguably NFTs distill the essence of art ownership into its core proposition: you become the owner of intangible that is commonly understood by all market participants to truly represent the artwork and is valued as such.
The NFT market is odd, but the art market is odd in general.
But none of your arguments apply to 'art in general' at all, do they? Because when you "buy art" you are actually... buying a piece of art.
The way we value 'art' obviously has culturally historical oddities attached to it. But none of them are comparable to what people are paying for when 'buying' NFTs (ie: their name in a database).
Which was the entire point of the Twitter thread.
The value in owning art isn't the physical object. The value comes from how owning that specific physical object means you "own" that art, whatever that means. I don't really understand why anyone would care about that either, but people clearly do.
And even if you disagree with that point, the other points about not owning copyright, lack of intrinsic value and using art for money laundering definitely apply to real art too.
It's naive to think that the majority of the value of buying a painting of a pure black square comes from having the physical painting itself rather than almost exclusively out of the story and recognition by others. Once you recognize that it's not so hard to see that you can remove the physical painting aspect altogether.
> If it were possible to create one, an exact atom-for-atom duplicate of a piece of art would likely also only be worth a small fraction of the "original".
Is a hypothetical for now.
I don’t get most of the famous artists — Picasso, The Beatles, Shakespeare and so on all seem overrated to me — but high-value original works are mostly that way because they are distinguishable from copies. I expect atomically precise duplicates would destroy the market for collector items unless you can re-attach scarcity in some way.
Let's say this theoretical duplicator was perfect in every way EXCEPT you could tell it wasn't the original because the isotopic signatures didn't match. That is, for all intents and purposes, each duplicate is exactly the same but each instance encodes an unreproducible signature that can be used to identify it.
I postulate the original would still carry an enormous value relative to the exact duplicates.
I think this gets to the core of why so many people (like the entirety of Hacker News) seem to irrationally hate NFTs, to the point of posting about it almost every day instead of just ignoring it.
There are shared delusions that are useful as social coordinating forces. Religions are generally this. Social justice is this. And crypto is also this. I find that a lot of the irrational hatred for NFTs and crypto in general tends to come from people who hold certain shared delusions and who don't like that another competing one is so successful at coordinating behavior.
Just because it's nonsense doesn't mean that a bunch of people aren't going to make significant amounts of money before it fades away.
I believe that in English language fraud is an appropriate word for such enterprises.
Is it a scam? well it depends whether the elite values NFT or not... it certainly is a speculative "asset" by nature.
It's not a scam provided people know what they are exactly buying. It's more of yet another "get rich quick" scheme for some.
However, beyond the speculative aspect of NFT, artists need to know that putting their art in a virtual gallery as NFT WILL COST THEM money, so the business model for the middle man is to make artist believe that they will make money from NFT. The house always wins...
For things like ship preorders on Star Citizen it's much more of a risk that the value will ever be delivered but it's still offers more than just a note of ownership of an abstract token on a blockchain sequence.
If someone decides to honor these tokens as proof of ownership of property/items in the real world/ a virtual world then they may offer some value but there's a very great risk that will never happen.
It’s a little crazy to me how Twitter profiles with Apes are viewed as “influencers” and “pioneers” and get treated as such. Not my cup of tea per se, but there is tangible value for some people there.
NFTs give you NOTHING. They don't give you the right to anything. All you own is a (hopefully) unique cryptographic sequence.
>Something to look at maybe, something that distinguishes you in game?
You pretty obviously get that here, too. I honestly don't see why you'd think it gives you less other than out of general dislike for NFTs.
Many people also say EVs and green energy are a scam.
People also frequently accuse public companies of being scams or trash (there's a certain intersection between the previous sentence here).
Healthy skepticism is a powerful weapon of thought. But you have to be able to acknowledge where skepticism ends and stubborn refusal to accept reality starts.
Humans value certain things. They may not be the same things you value. That doesn't necessarily mean they're just "a giant scam".
This (very uninteresting) Twitter rant doesn’t really make any good arguments. The comparison to ‘star naming’ services is very contrived & makes absolutely no sense.
Some stuff is for sale. Nobody is being tricked into buying it. Everyone knows you click right click and save if you want.
Nope, you're buying a non-fungible token on a public ledger where the data and association with a specific address (or addresses) can be read without permission. This ownership and permission can then be moved around (potentially for large sums - potentially for near-zero amounts) by means that are independent of the client used. So for instance an NFT could give me access to an exclusive Discord channel (the client here being a Discord bot) and I could potentially sell or otherwise pass that onto someone else who wants access. The ownership of that token could also afford me access to, for instance, buying another token on another smart contract (the client here being another smart contract).
That they are commonly linked to metadata associated with JPEGs is really missing the opportunity here.
Furthermore, since everything's on a public ledger the much-stated money laundering is surprisingly difficult. And in fact multiple people have been caught out by this (a simple example being one of OpenSea's PM's wallets showing that they were frontrunning; another is VCs front-running their portfolio companies' air drops). That NFTs are often exchanged between bot accounts and multiple wallets (often tracked back to known individuals) to pump prices is also well-known and visible on the blockchain.
Whether or not you think expensive JPEGs are 2020s' Beanie Babies, it's hard to imagine a programmer on HN not being able to think of interesting non-JPEG things to do with an open source, public and permissionless ledger/database.
EDIT: disclosure - I have some JPEG NFTs. They weren't super expensive to me but I bought them so I had skin in the game that forced me to investigate this market rather than shouting "but money laundering!" from the sidelines. I'm glad I did this. Via getting into the weeds I've discovered a vibrant and super interesting ecosystem of developers, entrepreneurs, cryptographers and opportunities I'd never have known about otherwise. Are my JPEGs worth it? Doubt it. But the experience has been super interesting so far.
You underestimate the extent at which working-for-a-living has utterly destroyed my sense of imagination and ability to have an original thought.
It’s depressing. Very much so.
The history of cryptocurrency is exclusively people trying to come up with ideas for this extremely interesting class of data structures, yet consistently only reaching variants of "fraud." (And, those people who just jump immediately to fraud without much thinking.)
The problem is that people find it easy to jump to "money-laundering! beanie-babies!" and not spend the time thinking about what they might want to do with the tech. Strikes me as a bit curmudgeonly versus the optimistic, open-minded and innovative roots of HN...
Link?
You'd run a bot or similar on Discord that would grant you a role to access the channel and it would use your wallet to verify your identity (ala public key crypto) and the ownership of the NFT by your wallet to verify the permission to join.
Most of the time you're a centralized thing anyway in this case so the NFTs don't really add much (unless you want users to be able to trade access) even if you wanted to take payment via crypto-currencies.