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Hypothetically, NFTs are amazing. They have the potential to revolutionise royalties and help artist directly profit from the success of their work. There are s

by dbspin 6y ago

Hypothetically, NFTs are amazing. They have the potential to revolutionise royalties and help artist directly profit from the success of their work. There are successful marketplaces like Nifty Gateway for visual NFT's and some under development for music NFTs. But... Right now, Etheriums soaring 'gas' prices are basically freezing new entrants into the market. The cost of 'minting' a token on the blockchain right now - say an image or animation on rarible.com, is enormous. Worse, the gas cost of purchasing an NFT can be triple the sale price. It's the equivalent of a varying, unpredictable rate of VAT in the hundreds of percent. This is having a knock on effect on all the NFT markets. Maybe it can be solved by Etherium 2.0, but right now Ether isn't fit for purpose for NFTs. Tying the cost of smart contract 'gas' to the value of the digital currency made this inevitable.

suikadayo 6y ago
We don’t have to wait for Eth2, there are several L2 solutions in the works right now like Optimism and Polygon
- dbspin 6y ago
  They're not supported on any of the popular NFT trading / minting sites. That economy is currently built around ETH.
  - suikadayo 6y ago
    Opensea currently uses Matic/Polygon, in addition to L1 https://matic.opensea.io/ https://matic.opensea.io/
peter_l_downs 6y ago
Couldn't agree more that NFTs are theoretically very interesting but the way they work right now is absolute garbage. See this experience report: https://freezine.xyz/4/nfts/index.html https://freezine.xyz/4/nfts/index.html
- dbspin 6y ago
  I don't think this is particularly an issue with the way NFTs work - except in regard to their choice of Ether, and Ether's current issue with gas prices. I think there's a lot of potential in the existing markets. It's really specifically a problem with the economics of trading them, caused by the inflation in transaction costs of Ether. Article you linked the artists issue is that he couldn't find a market for his art. Which kind of misses the point. "Then I asked around if anyone wanted to buy it. The boys in the groupchat weren't interested. Neither were any of my twitter followers. Damn." Sure you could get lucky with being early into a highly speculative market, but by and large this is like patreon or kickstarter or anything else online. If there's a potential market for what you're making or doing, it's a new (and potentially lucrative) way to tap into it. It doesn't generate a new demand for work that doesn't have (or can't generate) an audience on its own. NFTs aren't a form of advertising, certainly not a particularly effective one. Also the artist initially used Zora (which I've never heard of), rather than Rarible or Opensea, or Mintable or Snark or any of the better known open markets. On rarible he set his royalties to 25% (rather than the usual 10%) which obviously discourages speculative investment. He also set the cost of his first art piece to 1 ETH! Crazy high for an unknown artist. The article kind of seems like a snarky joke, but if it is one I'm not sure what the punchline is, given he really did spend the money and really does seem to want to sell the NFTs. I think it's more likely a case of irony employed as a defence mechanism. We have someone who self confesses he doesn't understand the market, making a remix piece quickly and half assedly, selling it at a high rate across multiple markets, without an audience or any interest in what is popular there. I mean I get it, who wants to miss the gold rush? But it's not a useful barometer of NFTs. Currently all the real money is being made by selective services who primarily work with digital artists who have an existing following, or make work they think will reach an audience - sites like niftygateway.com or superrare.co The work that's selling well is generally excellent. And sure, there is something inherently ridiculous in the idea of 'owning' a piece of digital art. But no more so that owning a numbered print or piece of video art by a renowned artist, or hell a cardigan owned by Kurt Cobain. All of which have real, established and ongoing value.

by dbspin 6y ago

suikadayo 6y ago

We don’t have to wait for Eth2, there are several L2 solutions in the works right now like Optimism and Polygon

dbspin 6y ago
They're not supported on any of the popular NFT trading / minting sites. That economy is currently built around ETH.
- suikadayo 6y ago
  Opensea currently uses Matic/Polygon, in addition to L1 https://matic.opensea.io/ https://matic.opensea.io/

peter_l_downs 6y ago

Couldn't agree more that NFTs are theoretically very interesting but the way they work right now is absolute garbage. See this experience report: https://freezine.xyz/4/nfts/index.html https://freezine.xyz/4/nfts/index.html

dbspin 6y ago
I don't think this is particularly an issue with the way NFTs work - except in regard to their choice of Ether, and Ether's current issue with gas prices. I think there's a lot of potential in the existing markets. It's really specifically a problem with the economics of trading them, caused by the inflation in transaction costs of Ether. Article you linked the artists issue is that he couldn't find a market for his art. Which kind of misses the point. "Then I asked around if anyone wanted to buy it. The boys in the groupchat weren't interested. Neither were any of my twitter followers. Damn." Sure you could get lucky with being early into a highly speculative market, but by and large this is like patreon or kickstarter or anything else online. If there's a potential market for what you're making or doing, it's a new (and potentially lucrative) way to tap into it. It doesn't generate a new demand for work that doesn't have (or can't generate) an audience on its own. NFTs aren't a form of advertising, certainly not a particularly effective one. Also the artist initially used Zora (which I've never heard of), rather than Rarible or Opensea, or Mintable or Snark or any of the better known open markets. On rarible he set his royalties to 25% (rather than the usual 10%) which obviously discourages speculative investment. He also set the cost of his first art piece to 1 ETH! Crazy high for an unknown artist. The article kind of seems like a snarky joke, but if it is one I'm not sure what the punchline is, given he really did spend the money and really does seem to want to sell the NFTs. I think it's more likely a case of irony employed as a defence mechanism. We have someone who self confesses he doesn't understand the market, making a remix piece quickly and half assedly, selling it at a high rate across multiple markets, without an audience or any interest in what is popular there. I mean I get it, who wants to miss the gold rush? But it's not a useful barometer of NFTs. Currently all the real money is being made by selective services who primarily work with digital artists who have an existing following, or make work they think will reach an audience - sites like niftygateway.com or superrare.co The work that's selling well is generally excellent. And sure, there is something inherently ridiculous in the idea of 'owning' a piece of digital art. But no more so that owning a numbered print or piece of video art by a renowned artist, or hell a cardigan owned by Kurt Cobain. All of which have real, established and ongoing value.