Non-Fungible Tokens are a hot topic. If you want the TL;DR version of what an NFT is, this clip does it in 60 seconds. We’ll wait, no rush.
WSJ’s 5 minute primer is also great, going into detail and showing more examples of NFT in action. Hit that Watch Later button and keep reading….
No need to get hung up on the technicals for now; so long as you get that NFT’s are unique, digital assets that are bought and sold, we can continue. What we want to address is the concept of value; specifically, the opinion that NFTs can’t be worth anything at all, let alone millions, because they’re ‘only digital’. Which is where we say
We are way past the point where value could be questioned based on digital-ness. Or a digital asset’s analog counterpart has greater value by default. Our digital reality is already here, and we say it’s anything but worthless.
Gamers spend billions on modifying their in-game avatars. They’re also snapping up virtual real estate. Sports memorabilia is on the blockchain (and fans love it) thanks to NBA Top Shots. Virtual clothing is a rapidly expanding category of fashion, and video filters for the work environment are likely around the corner, where a booming market will develop. Not only makeup or acne removal either. Imagine a filter that makes you look more alert, so AI trackers running the video conference software give you a higher attentiveness score and a better shot at a raise or promotion. As hellishly dystopian as that sounds, you can bet a lot of people will pay for it. Because they see the value, which is key to our point: Value is in the eye of the beholder. We can debate value because it’s subjective, which is what makes it so fascinating. One person’s trash is another’s treasure.
To argue that something cannot be considered valuable because it’s intangible is a line of thinking about as contemporary as suggesting your friend sort their depression out with some light trepanning.
Non-Fungible Tokens are in a speculative phase as technologists, artists, entrepreneurs (and opportunists) look for ways to put it to use. It’s too soon to categorically shut down what is or isn’t going to happen. Current practices will be optimised (perhaps how royalties for music are tracked and paid) some will be fundamentally changed (collateralising real estate for retail investors to buy shares in) and entirely new ones will spring up. Most experiments will fail catastrophically and a few will exceed expectations against all odds. It’s going to be wild, and weird, and alien.
The value of NFTs cannot be predicted or guaranteed but to believe that they have no worth because they don’t fit a definition of real is a perspective we don’t see any future in.