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> What is its potential? What can someone do with NFTs that they couldn't do before? The novelty comes from the underlying protocols that back the NFT. These p

> What is its potential? What can someone do with NFTs that they couldn't do before? The novelty comes from the underlying protocols that back the NFT. These protocols create marketplaces that are widely available and accessible and are reliably secure and robust. Take copyright for example. Copyright laws vary across regions and marketplace. The encoding and repudiation of these copyright laws is based on analog processes. The data related to the assets in question are stored in databases with a widely varying degree of access. Verifiability across assets or even within a single asset class varies and to varying degrees of reliability. And I'm not saying this to point out that copyright laws and the assets relying on them have failed or are not value add in many ways. The fundamental point is that the technological infrastructure underlying the use of copyright laws today has a lot to be desired when it applies to ease of use for digital media. Networks using blockchain protocols can offer a natively digital infrastructure solution that helps extend or replicate the value offered by something like copyright law. The natively digital aspect enables broader interaction which engenders more general purpose usage which ultimately leads to new consumer models (i.e. direct artist to consumer, peer to peer, etc.). > Owning the NFT for something does nothing more than copyright already does. You can store the digital asset on your computer with or without the NFT. You can "consume" it either way as well. The point is not to displace copyright law)(although others may argue this I do not). The value add here is in creating a widely accessible and reliable digital mechanism for creating, expressing, and modifying ownership rights. Different, or maybe even traditional, consumption models are then built on top of this to capture this value. To your point about gaming creators choosing to do so or not; this question is really a question about what is the value of blockchain protocol networks in the first place and how would someone like a game creator benefit or capture this value? To this point, I can only point out the potential benefits as I'll be the first to agree the nature of blockchain and its value is still being explored. My arguments above are trying to express the value as I see it. Would be curious to hear more thoughts and criticism.

wokwokwok 6y ago
The point you’re making is valid, but you’re side stepping the key concern being raised. The tokens you acquire are worth nothing. Nothing about owning a token grants you any rights to anything other than what some other person is willing to pay/exchange it for. So if a game developer chooses to accept tokens, you can use them; but that developer can at any time choose to stop accepting tokens or a subset of tokens making what you own worth actually nothing. Now... for a regulated system of tokens (eg currency) a developer can’t do that: they are legally bound to accept fiat currency even though it is not redeemable for any “real” equivalent (eg gold). Since a token is not bound to the DRM access to an item (say, image for example), it’s totally pointless to asset ownership with it, because it does not prevent the copy of the original digital asset. The best you could ever hope for would be a regulated system, in which access to an asset via DRM was granted by a token. ...at which point, any “decentralised” benefit is lost. So ultimately, the risk is 100% on the buyer here. What you buy may be redeemable for something for some period of time... but that is true of any kind of token. The “uniqueness” of the NFT is an illusion; it does not offer any strong guarantee of uniquely representing an actual asset.
- dragonwriter 6y ago
  > Now... for a regulated system of tokens (eg currency) a developer can’t do that: they are legally bound to accept fiat currency even though it is not redeemable for any “real” equivalent (eg gold). This isn't true in general. Legal tender status is very loosely an obligation to accept for existing debts, but it is not an obligation to accept it as, say, a means of accepting a offer. So unless they are giving you goods first, and the looking for payment (which certainly is not the norm for digital goods), they are under no obligation to accept currency.
  - freshhawk 6y ago
    But that's really why everyone will always accept them, because they can pay their debts/taxes with them. It's probably a common misconception because it's so close to correct.
- TheColorYellow 6y ago
  Rephrasing your questions and critiques more broadly: What is the point of all this digital infrastructure if no one uses it? Why would anyone use it? This is a more difficult question for NFTs as the market is even smaller than the financial use cases which has been driving blockchain applications. It'll take some time for seemingly legitimate and long-lasting value in areas for NFT to emerge as they are still being explored and developed. However, no matter how you frame it, rhe value proposition for applications comes down to the value add characteristics of the networks they are built on top of. > The tokens you acquire are worth nothing. The tokens worth is determined by the market place that emerges around the tokens characteristics. Some tokens are censorship resistant and run on globally accessible networks so that they are not easily erased, their ownership is easy to prove, and their history is reliably known. Some tokens are required to access other marketplaces or services because they have properties that make them more easy to use as traditional currencies. Some tokens allow for self-ownership paradigms. Again, the tokens acquired carry the value of the characteristics of the networks in which they are issued. What these characteristics are valued as and actually "worth" in real economic terms is dependent on their demand. > The “uniqueness” of the NFT is an illusion; it does not offer any strong guarantee of uniquely representing an actual asset. This is only true if the NFT isn't accepted as value. If the characteristics I described earlier indeed do become valued, then the ledger which holds the claim i.e. the NFT will be taken as the source of truth for representing the ownership of the claimed asset. Its the theory of accounting applied to a different space.

wokwokwok 6y ago

The point you’re making is valid, but you’re side stepping the key concern being raised. The tokens you acquire are worth nothing. Nothing about owning a token grants you any rights to anything other than what some other person is willing to pay/exchange it for. So if a game developer chooses to accept tokens, you can use them; but that developer can at any time choose to stop accepting tokens or a subset of tokens making what you own worth actually nothing. Now... for a regulated system of tokens (eg currency) a developer can’t do that: they are legally bound to accept fiat currency even though it is not redeemable for any “real” equivalent (eg gold). Since a token is not bound to the DRM access to an item (say, image for example), it’s totally pointless to asset ownership with it, because it does not prevent the copy of the original digital asset. The best you could ever hope for would be a regulated system, in which access to an asset via DRM was granted by a token. ...at which point, any “decentralised” benefit is lost. So ultimately, the risk is 100% on the buyer here. What you buy may be redeemable for something for some period of time... but that is true of any kind of token. The “uniqueness” of the NFT is an illusion; it does not offer any strong guarantee of uniquely representing an actual asset.

dragonwriter 6y ago
> Now... for a regulated system of tokens (eg currency) a developer can’t do that: they are legally bound to accept fiat currency even though it is not redeemable for any “real” equivalent (eg gold). This isn't true in general. Legal tender status is very loosely an obligation to accept for existing debts, but it is not an obligation to accept it as, say, a means of accepting a offer. So unless they are giving you goods first, and the looking for payment (which certainly is not the norm for digital goods), they are under no obligation to accept currency.
- freshhawk 6y ago
  But that's really why everyone will always accept them, because they can pay their debts/taxes with them. It's probably a common misconception because it's so close to correct.
TheColorYellow 6y ago
Rephrasing your questions and critiques more broadly: What is the point of all this digital infrastructure if no one uses it? Why would anyone use it? This is a more difficult question for NFTs as the market is even smaller than the financial use cases which has been driving blockchain applications. It'll take some time for seemingly legitimate and long-lasting value in areas for NFT to emerge as they are still being explored and developed. However, no matter how you frame it, rhe value proposition for applications comes down to the value add characteristics of the networks they are built on top of. > The tokens you acquire are worth nothing. The tokens worth is determined by the market place that emerges around the tokens characteristics. Some tokens are censorship resistant and run on globally accessible networks so that they are not easily erased, their ownership is easy to prove, and their history is reliably known. Some tokens are required to access other marketplaces or services because they have properties that make them more easy to use as traditional currencies. Some tokens allow for self-ownership paradigms. Again, the tokens acquired carry the value of the characteristics of the networks in which they are issued. What these characteristics are valued as and actually "worth" in real economic terms is dependent on their demand. > The “uniqueness” of the NFT is an illusion; it does not offer any strong guarantee of uniquely representing an actual asset. This is only true if the NFT isn't accepted as value. If the characteristics I described earlier indeed do become valued, then the ledger which holds the claim i.e. the NFT will be taken as the source of truth for representing the ownership of the claimed asset. Its the theory of accounting applied to a different space.