This week the Washington Capitals announced they would debut their very first collection of NFTs, prompting some questions such as:
- what?,
- huh?, and
- um, why?
Here are some answers.
What is an NFT?
An NFT is a non-fungible token.
What?
A non-fungible token.
That doesn’t mean anything.
Questions only, please.
Okay, dick, what does non-fungible mean?
It’s like being one-of-a-kind or precious. We have used the word a ton here for some reason. Anyway, you can’t copy NFTs.
And an NFT is?
Zach Leonsis calls them “digital collectibles”, which is a lot more intuitive than NFT.
Okay, but like, what is it? Give me an example of one.
The New Jersey Devils are selling this as an NFT:
Wait, that’s just a video?
So you noticed that too.
But… you literally just copied it. You said you couldn’t copy an NFT.
Not a question, but I’ll allow it. I copied the video, but not the token which contains the video, which would prove I bought it.
Oh, so it’s like you’re buying the video?
No. You’re buying the token, which cannot be copied, which points to the video, which can absolutely be copied.
But I don’t own the video?
Absolutely not. You own the token. And maybe it’ll go up in value, and you can resell it, in which case its creator can get a piece of the resale. In the case of the Devils, the creator is a company owned by billionaire Josh Harris. In other cases, the creator of an NFT might be an independent artist or some other member of a group of people who have been screwed over by the rampant media consolidation of the last 25 years.
Got it. Neoliberalism bad, but how does any of this work?
Oh, it’s on the blockchain.
What is blockchain?
Blockchain is family of technologies for distributed ledgers using progressive hashes and proof-of-work.
That is some technobabble right there. What is this, Star Trek?
No, this is Star Trek:
(Check out Trekonomics: The Economics of Star Trek by Manu Saadia)
But I take your point. Progressive hashes really are a good way to demonstrate the authenticity of a series of events. It gets a lot messier when that series is distributed among millions of computers all racing each other to do long division (“mining”) in order to add the next link in the chain, which is why it’s hard to get good graphics cards these days for your PC video games and kinda why Death Valley will hit 131 degrees this weekend, but I’m off-topic now.
I forget who said it first, but blockchain is a solution in search of a problem. Cryptocurrencies like bitcoin, ethereum, and dogecoin, plus NFTs, are commercial ideas that have been applied to blockchain technology. Cryptocurrency and NFTs are ultimately fueled by speculation that prices will rise– oh, that and money laundering.
I’m tired. Why is this happening?
Well, you probably already know the short answer, but here’s a longer, far more tedious, fractionally entertaining version of the same answer.
So this is “Jamie” by Weezer:
It was released in 1994 on a compilation called DGC Rarities Volume 1. The “rarities” part made sense at the time. You could only hear the song if you had a physical copy of the CD (or cassette tape, ask your parents) or if it was played on college radio.
For that reason, I didn’t hear the song until years later, when I found it on Napster or something, under this filename:
weezer_-_dgc_rarities_-_jamie%20rare%20_-_RABID%20NEUR0SIS%20WAREZ.mp3
Once the song was digitally distributed, its rareness became artificial. The song has been played millions of times now on YouTube and Spotify. That’s not rare.
And that’s the purest nature of the internet, and by remote extension humanity’s ultimate mission: end scarcity for all so we can explore Whatever’s Next. Except right now I’m talking about Weezer’s “Jamie” instead of access to clean water.
Okay, trying again. Here’s a diagram:
You are Adam Oates in a private eye costume, and you have a delicious Tequiza. I see it. I want the Tequiza, so I steal it.
Now I have a Tequiza and you don’t. My theft of your Tequiza has deprived you of the Tequiza. That individual bottle of Tequiza was non-fungible.
That’s how the meatworld works, but in the information world it doesn’t have to be that way.
This time, you, again Adam Oates dressed funny, have a really good picture of the sex-positive squirrel from The Sword In The Stone. And I want it.
I can copy (and possibly steal) your picture a bunch of times, but that theft does not deprive you of your copy of that picture.
NFTs make the information world appear like the meatworld. It’s an invented layer of artificial scarcity bolted on top of the internet’s share-y foundation to give the impression of rareness where there is none. And we could forgive all of that if and when the layer serves to get creators paid for their work. But when it’s just another vector for billionaires to do mass wealth extraction, then it’s time for a suspicious side-eye and a long-winded and deeply stupid blog post.
Uh, did you forget I was here?
Yeah, sorry about that.
Anyway, I don’t like NFTs, but you do you, and this isn’t financial advice. Love you, bye.
