NFTs

[Dave Gray]

They're all the rage.  Discuss.

[EDGECRUSHER]

Doesn't matter how many times it is explained to me, I have no idea how these things are anything but money laundering. I can't buy a house with a picture of a Donkey skateboarding, so why is it worth $400,000?

[CF DolFan]

Doesn't matter how many times it is explained to me, I have no idea how these things are anything but money laundering. I can't buy a house with a picture of a Donkey skateboarding, so why is it worth $400,000?

hahaha ... one of the most logical statements I've heard about them. Basically it's like buying expensive wallpaper images for your PC. No thank you for me

[Dave Gray]

Seeing you two talk above makes me more hopeful, because your thought process is inconsistent and it shows that you just don't understand it.  So, when you finally do, the value of this stuff will be in place.

Gold was a tangible asset.

Paper money has no value.  It's just paper.  I can make my own paper.  I can photocopy money.  What's the difference.  It's because it's the shared understanding of the value.  In fact, we could eliminate paper money and just use the numbers on our bank statement and everyone considers that value.

And technology allows us to track this stuff free of a central system.  That's what bitcoin is.


So, think of a baseball card.  It's a picture on cardboard.  You can have a Honus Wagner rookie that is rare and valuable.  I can go have one printed just the same....a picture on cardboard, but yours is valuable and mine is not....it's because of what your care represents -- the authenticity of what it is, despite my little piece of cardboard being all but identical.

That's what NFTs are.  It's a digital collectible where you are essentially owning the "certificate of authenticity" without owning the physical item.

It doesn't have to be an image.  It could be anything.



I saw this firsthand with digital trading cards.  Because there was scarcity, there was value.  The problem there was that you never actually owned the rights.  The system they were on could shut down at any time.  NFTs are a way around that.

I'm not sold on it and I'm not interested in being a collector necessarily, but I definitely see the value in the idea and would like to get in on the ground floor for some of these hot properties.  Literally every single thing you guys are saying are exactly the things I heard said about cryptocurrency and bitcoin made a bunch of people millionaires.

[Pappy13]

Could be something, but they could all be worthless in 5 years too. I wouldn't put a lot of my own time or money into them.

[Dave Gray]

I think there's absolutely no chance that they'll all be worthless.  It's possible, though, that the market gets totally flooded, there's a huge bubble, and it burts and many or most of them crash in value, perhaps to lower than the purchase price.    But the prime stuff will hold value....it's just a question of figuring out what the prime stuff is.


There's also kind of a gambling aspect to it.  UFC has NFCs but you didn't get to pick the fighter.  ...so you could have a guy that goes on to win and be the best, or you could get a guy that turned into a bum.  That would logically affect value, like a pack of trading cards of rookies.

[MyGodWearsAHoodie]

I just spent $100,000 on a picture of a dutch Tulip field featuring 1,634 tulips, there is no way I can lose money on this.   

[Tenshot13]

I'm big into crypto, I've been following the scene for years and have some sizeable investments.  With that being said, NFTs are garbage.  There's a market for them sure, but I think they are the dumbest thing to come out of the crypto scene.  I own exactly one NFT, and it's a little different than the others you've seen.  There is a game called DefiKingdoms.  It's basic sprite graphics, nothing flashy at all.  The currency there is JEWEL, a crypto currency token.  You buy a hero NFT with JEWEL.  You level up your hero NFT like a super basic RPG by doing foraging, fishing, mining and gardening quests.  There are rare heroes that sell for a lot, or you can level up your hero and resell it for more money.  You can combine two heroes and summon your own heroes but it's its all random so you might end up with something worse than what you started with.  Heroes start at around $400 for a basic one.  That isn't a complete shit idea for an NFT imo, but most of them are.

[Pappy13]

That's what NFTs are.  It's a digital collectible where you are essentially owning the "certificate of authenticity" without owning the physical item.

The problem that I see unless I'm mistaken is that there's really nothing limiting the number of NFT's for a particular item so someone could make millions of them and thereby lowering their individual value. So for example what if someone makes 10 and I buy 1 and I think it has value and then they make 10,000 more of them and they become worth less than what I purchased it for? Is there something preventing that? Seems like the value of these NFT's can easily go up or down, it's like playing the stock market in my opinion.

And while you don't think they will ever become worthless, they will if the entire blockchain is replaced with some other blockchain that's better for whatever reason. For example there's already a couple different platforms are there not? Who knows which ones will stick and which ones will become obsolete and worthless? You might be investing in Betamax instead of VHS.

[Spider-Dan]

Paper money has no value.  It's just paper.  I can make my own paper.  I can photocopy money.  What's the difference.  It's because it's the shared understanding of the value.  In fact, we could eliminate paper money and just use the numbers on our bank statement and everyone considers that value.

That's a bad analogy, as paper money (I don't think you mean to distinguish between bills and coins here, so let's just say "US currency") has a very specific and unique value: it's the only thing you're allowed to use to pay your taxes.  NFTs are more like buying art, but if the physical original never existed in the first place.  So as Pappy mentioned, it's easy to "create" a limitless supply of NFTs because the work involved is basically nil.

To me, the NFT market seems to be primarily a vehicle for scamming and/or money laundering.  For example:

I use a piece of software to generate, say, 1,000 NFTs.  I contact about 100 people and give them each $2100 (in, say, untrackable bitcoin) to buy an NFT from me for $2000.  So after spending $10,000 (in what is effectively commission), I now have 900 NFTs remaining with an "established market value" of $2000 each.  In other words, I have just created a $1,800,000 NFT library.  (This is a very simple and rudimentary example; the real ones are much stealthier.)

The whole thing is a joke.  But then again, so is crypto!

[Dave Gray]

The problem that I see unless I'm mistaken is that there's really nothing limiting the number of NFT's for a particular item so someone could make millions of them and thereby lowering their individual value. So for example what if someone makes 10 and I buy 1 and I think it has value and then they make 10,000 more of them and they become worth less than what I purchased it for?

It's exactly like baseball cards.  Topps could print more Nolan Ryan rookie cards today, if they wanted to, but only the originals would hold value.  The NFTs are numbered.

Maybe "first edition books" are a better example.  You can go buy Harry Potter from Barnes and Noble right now, but a first edition is worth big bucks.

[Fau Teixeira]

the problem in your analogy is that an NFT of a harry potter book or a nolan ryan rookie card doesn't need to have any relationship whatsoever to the book or the card. and the copyright holder doesn't have to have any part of the NFT creation / sale.

I could create an NFT today of the mona lisa and number it and sell it however i wanted without having to care about the actual painting. And if the NFT were to be something original, then the fact that the sale is registered in a crypto chain doesn't prevent me from making a copy of the NFT and keeping it without repercussion.

so in summary NFT = no fucking thing

[MyGodWearsAHoodie]

the problem in your analogy is that an NFT of a harry potter book or a nolan ryan rookie card doesn't need to have any relationship whatsoever to the book or the card. and the copyright holder doesn't have to have any part of the NFT creation / sale.

I could create an NFT today of the mona lisa and number it and sell it however i wanted without having to care about the actual painting. And if the NFT were to be something original, then the fact that the sale is registered in a crypto chain doesn't prevent me from making a copy of the NFT and keeping it without repercussion.

so in summary NFT = no fucking thing

Not quite.  Nolan Ryan didn’t create his own rookie card.  Topps created the card without Nolan’s real involvement.  And the value of the original Mona Lisa is just as illusory as an NFT, has a greater value than of millions of other paintings solely because a bunch of people think it is valuable. 

I think NFTs are likely a fad, but aren’t fundamentally any different than any other “collectible“

[Spider-Dan]

It's like combining the worst of crypto with the worst of art collecting.
It's a sign that some people have far too much money.

[Pappy13]

It's exactly like baseball cards.  Topps could print more Nolan Ryan rookie cards today, if they wanted to, but only the originals would hold value.  The NFTs are numbered.

And what about the other point I made. Topps wasn't the only company making baseball cards in Nolan's rookie year, but unless it's a Topps card it doesn't have value. What happens when bitcoin fails? All those bitcoin tokens become worthless. It's really hard to know right now which ones are going to succeed and which ones are going to fail which is why they are so popular, people are speculating which ones are going to succeed and they all think they know and their value is based on what people think right now, 10 years from now they might be worth nothing.