Owning Art, Memes and Collectibles: The World of NFTs 🌍
We will talk about NFTs today. NFT stands for non-fungible token. There is no strict definition for what constitutes an NFT; as it's an emerging token standard. Jacob Evans, one of the authors of EIP-721, the non-fungible token standard, describes NFTs as a new form of crypto-collectible, a digital sound good that is:
Uniquely identifiable
Provably scarce
Programmable
Publicly accessible by default
Censorship resistant
They are distinguishable, and you must track the ownership of each one separately.
The Ethereum Improvement proposal (EIP-721) sums up the need for NFT:
"All houses are distinct, and no two kittens are alike. NFTs are distinguishable, and you must track the ownership of each one separately".
If you still aren't sure about the opportunities for NFTs, imagine artists. Each piece produced is as valuable as the creator who makes it. If someone were to recreate "Mona Lisa's" painting or replicate it, it would not suddenly be as valuable as the masterpiece created by Leonardo Da Vinci. That's where NFT comes in. It is distinguishable and helps track the ownership of each underlying asset separately. In other words, my Mona Lisa is not of the same value as Da Vinci's Mona Lisa.
However, thinking only about art is too short-sighted. Because NFTs are about user-generated value. They are a path to produce non-zero value digital assets.
They allow you to tokenize arbitrary information (media) and prove ownership of the said asset. Think memes, collectibles, negative value assets - loans, or debt. We have user-generated value.
It opens up a whole new ecosystem of experimentation on user-generated value. As per Cointelegraph, one such experiment that is being done by an Art historian turned blockchain artist Benjamin Gentilli, who as part of the Robert Alice art collective, has created "Portrait of a Mind" — a monumental series of 40 paintings stretching over 50 meters in length.
This series of paintings immortalizing the Bitcoin codebase will be sold by Christie’s as part of its “Post-War and Contemporary Day Auction” on Oct. 7, at the end of a week-long exhibition of auctioned works in New York, as a non-fungible token.
It’s yours for 18,000$! Christies Auction Page
Source: Louis Reed
Why does it matter?
It is an experiment in decentralized and distributed art. Imagine breaking down a painting and owning a part of it. No one would appreciate it. However, with this experimental art, collectors get ownership of a piece of artwork, without owning the whole painting. What's more interesting is that without even a single member's participation, the whole artwork is worthless. It's an experiment to fractionalize content and give provable ownership.
The Big Picture
Art is just the start. The playground for experimentation is enormous. Because you can tokenize arbitrary information and enable user-generated value it can range from owning a part of your favourite Instagram celeb to your favourite meme or even your preferred Netflix binge-watch. The possibilities are endless; this is just the start. Until next time..
We will cover more about NFT and its possibilities in future posts.