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Imagine some game company creates an online basketball game and owning a LeBron NFT grants you the right to play with a unique LeBron skin. If you aren’t using

Imagine some game company creates an online basketball game and owning a LeBron NFT grants you the right to play with a unique LeBron skin. If you aren’t using the official NFT, the game won’t recognize your skin and no one will see you playing as that version of LeBron. That same token might grant you access to use that skin as a statue in Decentraland and everyone will be able to see who issued it (based on digital signature). Other people can make their own LeBron statues, but just like having a knock off of a statue in real life, having the real thing is more impressive. These NFTs can also encode more information such as how many of this same item exist, which other items are in the set, etc... and these virtual worlds can understand that info and you can prove that you own the entire LeBron set and only 10 sets exist. With NFTs being so new, people haven’t seen the eventual way they’re supposed to be used across ecosystems and their only experience with them so far is that they are useless.

iamben 6y ago
Genuine question - why do you need an NFT/the blockchain for the "in game" stuff? Why not just manage that "in game"? And then I guess - outside of "in game" what incentive would companies ever have to work with/create compatibility with any NFT stuff as opposed to just creating something similar themselves and owning it whole? Like if I was Apple, would I make it compatible with Facebook and Google, or just wall in another marketplace?
- tantalor 6y ago
  Blockchain provides a mechanism to trade the token in a standardized way with existing marketplace tools, and without central authority/consent.
  - iamben 6y ago
    Right, but as a game manufacturer, wouldn't I want to be a central authority?
    - tantalor 6y ago
      Yeah. But this way you don't need to build/operate the marketplace.
      - iamben 6y ago
        But surely you'd still need to build something to work with the NFT marketplace(s)? At which point, why not just own the whole thing?
        fastball 6y ago
        Well, you can do that already. It's the existing business model. This is an alternative, for consumers that maybe weren't interested in buying a gun that they can only use in GTA:O, but maybe would be interested in buying a gun from [Game A] knowing that [Game B] and [Game C] (which they already play) allows them to use that same gun in their game. And that nobody else can have that particular gun in those games. The technology (NFTs) is not really the end-all-be-all, it is lubricant which is intended to make the above use case more likely by enticing buy-in that would otherwise be less appealing.
      - rblatz 6y ago
        Sounds like a great way to do all the work and let other people get rich off of it.
      - deckard1 6y ago
        Operating the marketplace is the point.
    - iamwil 6y ago
      Yes, but only if I think I can capture most of the market. You see this behavior with Apple App store and Facebooks Quest store. Because they own the hardware, they have substantial power to be the central authority and extract the 30% rent. But for smaller game studios, you may not be able to do it, due to lack of resources, or lack of a moat, or you're not #1 in the space. Then you'd rather go into a collective marketplace. NFTs allow you to have marketplaces with items that are usable in any game that recognizes it. This has already happened once. For example, in Gods Unchained (a CCG), you can import a Cryptokitty that you own, to decorate your playing board. https://www.cryptokitties.co/gods-unchained https://www.cryptokitties.co/gods-unchained https://blog.godsunchained.com/2019/02/11/cryptokitties-x-gods-unchained/ https://blog.godsunchained.com/2019/02/11/cryptokitties-x-go... It's kinda like cross promotion between games, in the same way mobile games did cross-promotional ads. You also see this kind of behavior with Openstreetmaps. Google is #1, so they don't care. All the #2 and #3 players are working together on openstreetmaps to collect their market power to beat #1. What lots of people on HN don't see is that NFTs are public interfaces for interchangable immutable items with a history that any application can choose to honor for interoperabililty. I think you can use it for more than just art.
iamacyborg 6y ago
> Other people can make their own LeBron statues, but just like having a knock off of a statue in real life, having the real thing is more impressive. This is the thing though. How do you authenticate the creator of the NFT to ensure that the "legit" token is actually legit. To give you a concrete example, right now an organisation calling themselves "GlobalArtMuseum" is selling NFT's of artworks held in museums. This is not being done in collaboration with any museum, the artwork is counterfeit. How do you set the "authentic" NFT in the first place without rigorous compliance controls?
- FridgeSeal 6y ago
  And once you have this authentication, how is it any better than a normal “contract of sale” or such.
candybar 6y ago
Who makes money from the original NFT? Why would the game company not want to capture the revenue with their own NFTs? And why would Decentraland then honor the NFT some other game company issued, instead of issuing their own? Any entity who's providing utility associated with the NFT is going to want to sell their own NFTs - why would they do all the work only to have some third party capture the value?
ahepp 6y ago
So there's a central registry somewhere that validates "this is lebron's real nft"?
unclebucknasty 6y ago
>With NFTs being so new, people haven’t seen the eventual way they’re supposed to be used across ecosystems and their only experience with them so far is that they are useless. Why do you suppose it is that the first use case that has gained near-mainstream appeal is a use-case that portrays them as "useless"?

iamben 6y ago

Genuine question - why do you need an NFT/the blockchain for the "in game" stuff? Why not just manage that "in game"? And then I guess - outside of "in game" what incentive would companies ever have to work with/create compatibility with any NFT stuff as opposed to just creating something similar themselves and owning it whole? Like if I was Apple, would I make it compatible with Facebook and Google, or just wall in another marketplace?

tantalor 6y ago
Blockchain provides a mechanism to trade the token in a standardized way with existing marketplace tools, and without central authority/consent.
- iamben 6y ago
  Right, but as a game manufacturer, wouldn't I want to be a central authority?
  - tantalor 6y ago
    Yeah. But this way you don't need to build/operate the marketplace.
    - iamben 6y ago
      But surely you'd still need to build something to work with the NFT marketplace(s)? At which point, why not just own the whole thing?
      - fastball 6y ago
        Well, you can do that already. It's the existing business model. This is an alternative, for consumers that maybe weren't interested in buying a gun that they can only use in GTA:O, but maybe would be interested in buying a gun from [Game A] knowing that [Game B] and [Game C] (which they already play) allows them to use that same gun in their game. And that nobody else can have that particular gun in those games. The technology (NFTs) is not really the end-all-be-all, it is lubricant which is intended to make the above use case more likely by enticing buy-in that would otherwise be less appealing.
    - rblatz 6y ago
      Sounds like a great way to do all the work and let other people get rich off of it.
    - deckard1 6y ago
      Operating the marketplace is the point.
  - iamwil 6y ago
    Yes, but only if I think I can capture most of the market. You see this behavior with Apple App store and Facebooks Quest store. Because they own the hardware, they have substantial power to be the central authority and extract the 30% rent. But for smaller game studios, you may not be able to do it, due to lack of resources, or lack of a moat, or you're not #1 in the space. Then you'd rather go into a collective marketplace. NFTs allow you to have marketplaces with items that are usable in any game that recognizes it. This has already happened once. For example, in Gods Unchained (a CCG), you can import a Cryptokitty that you own, to decorate your playing board. https://www.cryptokitties.co/gods-unchained https://www.cryptokitties.co/gods-unchained https://blog.godsunchained.com/2019/02/11/cryptokitties-x-gods-unchained/ https://blog.godsunchained.com/2019/02/11/cryptokitties-x-go... It's kinda like cross promotion between games, in the same way mobile games did cross-promotional ads. You also see this kind of behavior with Openstreetmaps. Google is #1, so they don't care. All the #2 and #3 players are working together on openstreetmaps to collect their market power to beat #1. What lots of people on HN don't see is that NFTs are public interfaces for interchangable immutable items with a history that any application can choose to honor for interoperabililty. I think you can use it for more than just art.

iamacyborg 6y ago

> Other people can make their own LeBron statues, but just like having a knock off of a statue in real life, having the real thing is more impressive. This is the thing though. How do you authenticate the creator of the NFT to ensure that the "legit" token is actually legit. To give you a concrete example, right now an organisation calling themselves "GlobalArtMuseum" is selling NFT's of artworks held in museums. This is not being done in collaboration with any museum, the artwork is counterfeit. How do you set the "authentic" NFT in the first place without rigorous compliance controls?

FridgeSeal 6y ago
And once you have this authentication, how is it any better than a normal “contract of sale” or such.

candybar 6y ago

Who makes money from the original NFT? Why would the game company not want to capture the revenue with their own NFTs? And why would Decentraland then honor the NFT some other game company issued, instead of issuing their own? Any entity who's providing utility associated with the NFT is going to want to sell their own NFTs - why would they do all the work only to have some third party capture the value?

ahepp 6y ago

So there's a central registry somewhere that validates "this is lebron's real nft"?

unclebucknasty 6y ago

>With NFTs being so new, people haven’t seen the eventual way they’re supposed to be used across ecosystems and their only experience with them so far is that they are useless. Why do you suppose it is that the first use case that has gained near-mainstream appeal is a use-case that portrays them as "useless"?