Hey MJ & co. Why Is "Everyone Doing It" On NFTs? Is It The Real Deal?

[MTF]

You're witnessing a FOMO-driven mania.

Just focus on your own business that you control and (hopefully) provide real lasting value through it.

 

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[MJ DeMarco]

1) I wouldn't say "everyone is doing it" but it seems that way because of the media spotlight.

2) Right now, we're dealing with a Greater Fool market -- and that can continue for years until the fools run out.

You're witnessing a FOMO-driven mania.

Just focus on your own business that you control and (hopefully) provide real lasting value through it.

Best advice right here...

Between Gamestop, NFTs and BTC, we're seeing money-chasers who have been given a media bullhorn.

 

[PizzaOnTheRoof]

The real value is in the "tokenization" of assets. Imagine in the future you want to buy a piece of rare art as an investment, but you don't have a climate controlled space nor knowledge of preserving a 100 year old painting.

Instead, you buy the art from the previous owner through an online exchange, but the art stays in a museum, where it is meticulously cared for and stored.

You simply own the digital "deed" to the art. A deed that cannot be faked, stolen, or reproduced.

Now imagine you own a portfolio of rare art, cars, stamps, coins, historical documents, baseballs, etc, that are all secure and taken care of for you. No house fire or burglar can steal it to sell on the black market. You don't need a $5M insurance policy because the museum/warehouse takes care of it for you.

When you're ready to cash out your investment, you simply put the tokenized item for sale on an exchange and take payment within hours.

Cheesy 8-bit digital art that some YouTuber made in 2 hours? Eh.

I'd rather invest in Paxos.

 

[Raoul Duke]

Between Gamestop, NFTs and BTC, we're seeing money-chasers who have been given a media bullhorn.

And when it goes *pop*. They will blame the 1%.

 

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[The-J]

Just like crypto itself, it's a combination of overzealous speculation and a truly awesome (and purely capitalist) method for digital rights management.

Always be wary of "everyone's doing it". Even real estate isn't free from speculation-driven boom-bust cycles.

When the mania calms down, look at the people who continue to profit and see what they're doing.

 

[Mike Stoian]

I agree. There's no real value to be created there. At least not yet. I expect a huge boom, which we see now, then there will be a bust. Then later, this technology will become more entrenched and we'll see the actual uses for it and where value can be created. At least that's what I think.

On a side note, I used to love Alex Becker but this new wave of crypto and NFT he's on is triggering some flags for me. Sounds like he's just making videos on whatever's popular or trending. And what's popular and trending has always been a bad idea.

 

[MTF]

As an entrepreneur who creates digital art in the form of the written word, I would think you would care deeply about people spending money on this.

I primarily sell information for a few bucks per book. So I don't really consider it digital art. I'm merely saving people time by offering a book with information they could possibly find elsewhere but would spend a lot of time doing it.

Also, my brand is nothing compared to celebrities in the art world. So NFTs are not valuable to me at all because nobody would pay for them. I published a physical book that could be considered more of a "collectible" and it failed miserably.

Or maybe I don't believe in my work enough to believe that someone would spend a considerable amount of money to buy a file they can buy on Amazon for a few bucks.

Either way, I wouldn't feel okay selling something I don't believe has value. I appreciate the new opportunities for the right people but it's not for me.

 

[csalvato]

Either way, I wouldn't feel okay selling something I don't believe has value. I appreciate the new opportunities for the right people but it's not for me.

I think it's less about where the technology is right now (collectibles), and more about where it is going (creator-controlled rights management for digital property).

Smart contracts already exist where you can issue out the NFT and collect royalties on it, no matter where or how it is sold or consumed.

This is an existential threat to all self publishing platforms that specialize in digital books, like Amazon's CreateSpace or Audible, and, IMO, is an opportunity in which you might be able to capitalize.

Maybe not this year or next, but there's a very high probability that over the next 5-10 years your industry (along with the music and film industry) will be run mostly on NFTs, rather than centralized services like CreateSpace or middleman businesses like record labels.

I'm not criticizing you or forcing you to do anything – just providing food for thought to someone who I know feeds his brain.

 

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[Timmy C]

With new technology, people get excited.

Not many people have any idea what it is.

I have seen the NFT craze going wild but haven't participated in it.

I guess I can see it happening in the future, but I cant wrap my head around the value of it all.

I mean, why pay all that money when I can screenshot it?

Some sort of flex utility I would imagine.

 

[MaxKhalus]

I haven't found this thread in the Forum, and I'm sure many more will ask it again, so here it goes:

No matter what career you have, you'll have probably stumbled with crypto and NFTs. Because they're everywhere, from Gary Vee's channel to Google News.

With curiosity, I started and learned about the pros and cons of this currency. I'm not a fan of art/collecting, but for what I've learned, NFTs are an inflated version of that (easier/faster trade of non-fungible tokens).

Almost every day, I see bordeline ridiculous headlines...

Nothing wrong with that. I just can't make sense of it, and how it fits the productocracy. And everything you can find in both MJs books.

Are NFTs the real deal?

Two conflicts I see:
1. "Everyone is doing it." Everyone is buying because they believe that someone else will buy. (Ponzi connotation)
2. It has no intrinsic value

And yes, you could say that money itself doesn't have intrinsic value either.

In short, I know what NFTs are, pros and cons. I don't know why they exist or they should be worth anything.

P.S. Not asking for investment advice.

 

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[csalvato]

NFTs are going to change the world of art, music, publishing and rights management. It will give more power back to the creator, which is why artists of all kinds love it.

To dismiss it as a FOMO induced tulip bubble is missing the bigger picture.

NFTs arent just like collectibles, they are collectibles. And most collectibles are worthless, with a few being very highly valued.

While I agree with the sentiment to “focus on your business”, I also think you shouldn’t have so much tunnel vision that you totally miss new technologies that will disrupt entire industries, including your own.

@MJ DeMarco and @MTF, As self publishing authors, I think it’s worth it for you to learn a lot about NFTs including how they work and how they might change your entire industry.

Mark Cuban did a good interview on NFTs here:

View: https://youtu.be/l3ptz8qvZcg

3LAU also did a good one here, that should hopefully get creatives to see how this can change everything:

Artist who tokenized album for $11M explains why the NFT boom isn't like the ICO craze

Listen to this episode from The Scoop on Spotify. The market for non-fungible tokens, digital collectibles, and tokenized music is hitting the mainstream. On Thursday, Beeple's NFT-powered suite of 5,000 images sold for a staggering $69 million, making it the third-highest figure paid for work...

open.spotify.com

 

[MTF]

Agree, I could go find and sell you a few acres of land that is worthless. No utilities, limited access, no supporting local population, and too small to actually do anything productive with besides park a trailer on. Until someone has an idea to improve the land its intrinsic value is nothing. So the theory that there is no more land being made so the value always goes up does not hold true.

You can always grow food on it. Or live there in a tent or whatever. There's always some value. Of course, you can improve it more in some more capitalistic way, but the starting point already gives it value.

There's no value in NFTs other than speculative value. You can't improve it. You can't use it for anything. I'm not saying it does NOT have value and don't want to argue that point. Just saying that ultimately it's a 100% virtual thing that has no use whatsoever.

A physical painting has decorative value. You can see it, touch it, display it. Or you can burn it lol. NFT has no purpose. Unless you print that JPG (but you don't have to buy it for that).

In the end, I don't care if people want to spend their money on this. Ultimately, we all make investment decisions based on our personal experiences and values. People into art may be super excited to be able to support their favorite artists without the problems associated with storing physical art.

 

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[HelpAndProsper]

NFTs created a way for digital items to be uniquely identifiable.

Compare it to me printing a Picasso on my HP printer at home vs a true original Picasso.

One is worth millions, the other one is worth the price of a piece of paper.

Now digital assets can be impossible to counterfeit. Sure, you can screenshot a picture online.. but it is not the original so it has no value.

Counterfeiting IRL is really advanced and can be indistinguishable unless examined by the highest level of experts. And even they can be fooled. This takes human error out of the equation.

I agree. The miracle of NFTs and Blockchain in general is that now we have 'scarcity' built into digital form.
There were only so many Mickey Mantle baseball cards printed.

Now, with NFTs, you can decide there will only be so many digital copies of your art digitally available.

Even more brilliant, every time that one piece of digital art is sold in the future, the original artist gets a certain percentage cut on every sale in the future.

Amazing....

 

[Empires]

NFTs created a way for digital items to be uniquely identifiable.

Compare it to me printing a Picasso on my HP printer at home vs a true original Picasso.

One is worth millions, the other one is worth the price of a piece of paper.

Now digital assets can be impossible to counterfeit. Sure, you can screenshot a picture online.. but it is not the original so it has no value.

Counterfeiting IRL is really advanced and can be indistinguishable unless examined by the highest level of experts. And even they can be fooled. This takes human error out of the equation.

 

[pmaloneus]

GME to the moon

To da fuuqin mooonnnn. Apes strong together.

 

[Dwight Schrute]

To better understand this, I'll have to figure out too why anyone would pay high for a collectible/art work (not just NFTs).

Or why one seller sells higher than the other while selling the same product (branding).

"Veblen Goods"

It's the purchase of bragging rights, and reaffirmation of the customer's
self-image, as in "I'm the kind of guy who appreciates these nice things, whatever the price."

Same story with NFTs, only digital.

 

[Mike Stoian]

I guess I can see it happening in the future, but I cant wrap my head around the value of it all.

I mean, why pay all that money when I can screenshot it?

Same here. But I wonder if you can buy the actual rights of that asset. Then maybe you can at some point enforce your rights? Let's say you buy the rights to some new emoji. If someone wants to make another emoji movie and have it in there, would they have to pay you for the right to show your emoji?

On the other side, I heard people buy 5 second clips from NBA matches. They can't possibly OWN those 5 seconds now can they? No big television is gonna have to pay them for the rights to show that one historic NBA match again.

I dunno it feels more like Pokemon trading cards, but there's only 1 card of each. No intrinsic value to any of those cards, but some have ridiculous prices and people still value them.
It's the perception of value

 

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[csalvato]

Theoretically, nothing stops you from creating an identical NFT and register it as your own. Even though it's not the original, it's your version.

This is like saying if you paint your own version of the Mona Lisa it’s the same thing.

It’s not.

Mona Lisa’s aren’t fungible. Neither are NFTs.

 

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[csalvato]

2. It has no intrinsic value

Value is built when you have something someone else wants. Nothing is intrinsically valuable.

The concept of intrinsic value is a myth/narrative too many people have bought into through their life because of the status quo.

I think the higher level lesson in 2020-2021 that I have been seeing a lot of people miss is what it means for something to have value.

Going back to the concept of "intrinsic value" is an easy answer as to why a lot of stuff has no value.

And if one just accepts that answer, I believe they are missing the bigger trend that's going on: people are re-learning what "value" really means, and that there's no such thing as intrinsic value.

Value is solely a function of how much someone else wants that thing you have, and the number of options they have to secure that thing.

 

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[maverick]

We are at the very, very beginning of blockchain technology starting to move into mainstream applications.

Yes, there is a lot of speculation going on.
Yes, there are a lot of fools that are throwing their money around in anything they can find.
No, not everything will m00n or make you rich while you sleep.

But fools throwing their money around at anything blockchain related are just as bad as people that dismiss the technology straight out by spouting the old media chestnut: "TULIP MANIA".

Imagine being able to tokenise ownership of real estate. That by itself will eliminate a bunch of overhead/paperwork (e.g. in the near future notaries will be like travel agencies; extinct).

 

[MA81]

 

[Simon Angel]

You're witnessing a FOMO-driven mania.

Just focus on your own business that you control and (hopefully) provide real lasting value through it.

GME to the moon

 

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[Devampre]

There are potential opportunities with NFTs, but you likely won't find success by watching a clickbait youtube video or reading an article online from a popular source.

I can already picture the flood of charlatan guru's and their ads trying to sell me $997 courses on how to sell millions of dollars worth of NFT content.

 

[Xeon]

Part of the mania phase of the crypto craze. When this whole thing eventually busts and people realize it's all purple tulip syndrome, you'll see many supermen and superwomen flying down from high rise buildings.

You know those deviantart furry drawings? Stuff like that are selling for $300,000+ on some of the NFT boards. It's not a Rembrandt or Rubens, it's those kind of shit that 12 year olds like to draw.

 

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[MaxKhalus]

Thank you all. That kinda answers my question.

To better understand this, I'll have to figure out too why anyone would pay high for a collectible/art work (not just NFTs).

Or why one seller sells higher than the other while selling the same product (branding).

But yeah, better not to touch those NFTs for a while.

 

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[csalvato]

The NFT right ONLY exists in the platform where you buy it.

No it doesn’t. It exists on that platform or in your wallet, just like BTC exists on an exchange or in your own wallet.

 

[csalvato]

To better understand this, I'll have to figure out too why anyone would pay high for a collectible/art work (not just NFTs).

Scenario: You are ultra wealthy (100M+ in net worth). You see the government printing like crazy and want to get out of fiat. Where do you put your money?

There are many options for you. More than the average person because you have so much money.

One such avenue is collectibles. The highly priced ones go up in value and often they are cheap to store (think of buying a huge rare diamond that fits in a small display case, or a Picasso that just takes up some space on the wall).

The value should appreciate over time because it is a highly valued and rare collectible. It also gives you status that you own something rare and only you own it.

And you just protected your dollars.

This is one scenario for why collectibles get snatched up at super high prices. Most people don’t understand it because they are not ultra rich and never put themselves in those shoes.

Collectibles of all kinds are soaring right now, not just NFTs. For the ultra rich, an NFT is even more attractive since it takes no space to store it, and displaying it is cheap and easy if you want to..both physically and in virtual worlds like DCL and Twitter

 

[Sethamus]

Value is built when you have something someone else wants. Nothing is intrinsically valuable.

The concept of intrinsic value is a myth/narrative too many people have bought into through their life because of the status quo.

I think the higher level lesson in 2020-2021 that I have been seeing a lot of people miss is what it means for something to have value.

Going back to the concept of "intrinsic value" is an easy answer as to why a lot of stuff has no value.

And if one just accepts that answer, I believe they are missing the bigger trend that's going on: people are re-learning what "value" really means, and that there's no such thing as intrinsic value.

Value is solely a function of how much someone else that think you have, and the number of options they have to secure that thing.

Agree, I could go find and sell you a few acres of land that is worthless. No utilities, limited access, no supporting local population, and too small to actually do anything productive with besides park a trailer on. Until someone has an idea to improve the land its intrinsic value is nothing. So the theory that there is no more land being made so the value always goes up does not hold true.
If people think this nft crap has value, well then they purchase it. Some of these might end up having lasting value, but most probably won’t and will be out the money spent until someone comes along and decides it is valuable again. There is a reason we have junk yards and every country house has old cars or farm equipment parked on it. Almost zero value until you need that spare headlight off a 2003 Ford F-150 and the old man has it for $30 on a vehicle he got for free.

 

[csalvato]

In the end, I don't care if people want to spend their money on this.

As an entrepreneur who creates digital art in the form of the written word, I would think you would care deeply about people spending money on this.

 

[csalvato]

- If I'm ultra rich and own an NFT, can I go and sell it at the bank or exchange? (at the floor price)

To be clear most NFTs do not have a guaranteed floor price in the way EulerBeats does.

How EulerBeats implemented a guaranteed floor price is very interesting, though, and I can see more novel approaches to minting and managing NFTs that build on their basic concepts.

In the case of EulerBeats, the floor price can be achieved by clicking on button and getting a deposit of ETH into your account via the smart contract (no centralized services are necessary).

If you're ultra rich and own an NFT that's simply a piece of art as a collectible, then you sell it the same way you would sell any other collectible - by putting it on the market up for sale and hoping someone values that piece for as much as you did, or, ideally, more.

With traditional collectibles, the marketplace is very obscure and hidden. You need to use auction houses like Christies to see pieces and have a dealer put together a price history for you.

With NFTs, digital marketplaces make it very easy to buy and sell when compared to regular collectibles. But they are more illiquid than a fungible asset like BTC, USD or Tesla stock.

- How do NFTs relate to trademarks? It makes sense to buy both since it protects your commercial rights. It could be a way of getting that NFT out of the platform to the real world

If so, NFTs seem to have great value for protecting creator's media.

Trademarks and copyrights are enforceable by law. NFTs are not.

NFTs ensure you have a single copy of that one token. Trademarks and copyrights ensure that if someone uses your work outside the bounds of the law, you can take legal action.

In the near term, I believe it makes sense to get patents, trademarks and copyrights for things stored on NFTs, though you'd likely want to ask an NFT artist about that rather than me.

In the distant future, I believe trademarks, patents and copyrights will be managed by NFTs on a blockchain of some sort.

What I don't get is, why would anyone pay for it more than the production cost? Why does Mona Lisa cost millions besides rarity? Why one brand sells higher, even when a nobody may have a better product to sell?

Because someone wants it for that price. And one thing 2020-2021 has taught us is that, more than anything, it's about the story and narrative you can craft.

This was always true with collectibles, but in 2020-2021 we have seen humans reduced to their most basic elements when they buy and sell - because I want it and you have it.