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A curious observation about NFTs that many on HN seems to have missed in other threads: > Why is it that Elon Musk can sell an NFT of Elon Musk's tweet, but Je

A curious observation about NFTs that many on HN seems to have missed in other threads: > Why is it that Elon Musk can sell an NFT of Elon Musk's tweet, but Jeff Bezos would have a much harder time doing the same? Elon and Jeff have the same level of ability to screenshot Elon's tweet and stick it into an NFT dapp, so what's the difference? To anyone who has even a basic intuitive understanding of human social psychology (or the fake art scene), the answer is obvious: Elon selling Elon's tweet is the real thing, and Jeff doing the same is not. Once again, millions of dollars of value are being controlled and allocated, not by individuals or cryptographic keys, but by social conceptions of legitimacy.

sporkologist 6y ago
Do NFT's really only have value upon their first sale? Wouldn't that be basically a donation to Elon with no expectation of value on the secondary market?
- Swizec 6y ago
  Otherwise known as the reason large art sales exist: Money laundering et al. It is very convenient when you get to call your money transfer "A Sale". If the thing you're buying has a publicly verifiable (albeit dubious/preposterous) market value, you aren't even committing fraud!
- Jarwain 6y ago
  Resale of an NFT is different; since you can look up previous owners of the NFT there's a way to validate "yes this NFT is the one originally sold by Elon". The NFT has value Because it was the one Elon sold and signified as legit, versus the NFT some random person sold
  - sporkologist 6y ago
    Yeah but it's still "Elon's 2nd hand NFT"
Jarwain 6y ago
I think if Jeff Bezos decided to sell an NFT of Elon's first tweet, there would be more value there compared to if some random person sold an NFT representing the same thing
- capableweb 6y ago
  Correct, but maybe you're missing the point if that's your first thought. It now becomes "The NFT that Jeff Bezos made of Elon's first tweet", not the "Elon Musk NFT of Elon Musk", both obviously much more "interesting" (for human reasons? I don't know, don't care) than the "John Smith NFT of Elon Musk"
maxerickson 6y ago
If Elon can sell his own tweet NFTs better than anybody else can, that's a pretty good argument that they are gonna be a novelty and not some new form of art exchange. Because what are the buyers of the Elon-tweet NFTs gonna do when they decide they want something else for their 'value'? They are gonna try and sell the Elon-tweet NFT and find out that they lack legitimacy!
- wmf 6y ago
  You're misunderstanding the argument. Elon can create the NFT due to his legitimacy, but subsequent trading of those NFTs doesn't require legitimacy because ownership is tracked on the blockchain.
  - maxerickson 6y ago
    No, I'm mocking the whole idea, I understand the difference between origination and selling. I do legitimately think that novelty is a big factor, and buying an Elon-tweet NFT from some random guy is gonna have way less novelty value than buying it from Elon.
    - wmf 6y ago
      I agree. Overpaying for NFTs is like performance art; the value isn't in owning the NFT itself.
      - headmelted 6y ago
        Doesn’t “overpaying” imply that there’s an inherent value that’s non-zero? I’m not saying there is or there isn’t, but I’m not sure how that would be discerned. There’s a marketplace for artwork - is there a marketplace for tweets? Also, doesn’t Twitter inherently hold the rights to the content on it’s platform? (Or at the very least a license to reproduce the content indefinitely?). Maybe Twitter is the legitimate party here, if such a thing even exists.
      - funcjb 6y ago
kybernetikos 6y ago
To me it seems that NFTs could include some part of the bundle of IP rights that typically go along with an artistic work. For example, the artist could create a license that allows only the current owner of the NFT to make a physical copy, or a right to be credited whenever a physical copy is exhibited or something like that. I suppose I'm thinking in terms of what an ultra rich person gets from owning a famous artwork, if they then lend it to a public gallery and allow everyone to see it - I presume it's the right to have a little card next to it that says 'on loan from the collection of X'. I think NFTs could provide something of the same experience for 'owners' of digital assets.
- Animats 6y ago
  To me it seems that NFTs could include some part of the bundle of IP rights that typically go along with an artistic work. One might think that. One would usually be wrong. Read the terms for Top Shot or Mintable.
  - kybernetikos 6y ago
    I meant it more as a suggestion than a description of how things are currently. But i did look up top shot. It's interesting that they do mainly operate through the use of special licenses to make use of the artwork.
headmelted 6y ago
I struggle to find legitimate use cases for NFTs - and I say this with confidence that it’ll age like warm milk. That said, the one really obvious use case that jumps out at me is in-game loot. At least the inherent value of the NFT is tied back to something that people may want but otherwise can’t just copy-and-paste on their own. The only problem with the above is that it doesn’t benefit publishers to allow third parties to freely buy-and-sell commercial content without a cut, so I can’t see why they’d ever go for it.
- wmf 6y ago
  The smart contract could give a cut to the publisher. But ultimately if an NFT can only be used in one game why not just store it as a database entry on the game server?
  - capableweb 6y ago
    > But ultimately if an NFT can only be used in one game why not just store it as a database entry on the game server? That's the nice thing. Once you've created something with the ERC721 interface, it can be used in multiple places. Let's say you attach a hash pointing to a .glTF 3D object as well, and now multiple games can share the same items between them. Imagine buying a in-game hat in Counter-Strike and later bringing it to Fortnite. Silly? yes, but also useful in that world of sillyness and fun? Yes.
  - headmelted 6y ago
    Exactly this, but my thinking was that it might have some value to the publisher to build a marketplace around the content. As an example - games like Fortnite, Warzone and Apex Legends rely on loot as the sole driver of revenue. Having in-game rare items freely tradable akin to the trading card concept that NFTs are constantly compared to could have value in itself. If I’m a real fan of one of those games and I stumble upon a diamond-encrusted level 100 golden sniper rifle (sorry I’ve no idea what a good example of a rare item is in one of those games), then the money someone may pay for that is (e.g.) $1k. Giving me the ability to sell that on to someone could not only drive publicity for the game (EVE online made world news years ago because of the real monetary value lost in their battles) but encourage me to play that game over rivals as there’s perceptible real-world value for my invested time and effort. The downside I was thinking of above is that the publisher may not want to enable that for a bunch of reasons - the suggestion above sounds like a good way to resolve their revenue on the transactions, but the status quo of the items being non-transferable may be preferable as they’ll overall sell more loot directly to individual customers under the current system.

sporkologist 6y ago

Do NFT's really only have value upon their first sale? Wouldn't that be basically a donation to Elon with no expectation of value on the secondary market?

Swizec 6y ago
Otherwise known as the reason large art sales exist: Money laundering et al. It is very convenient when you get to call your money transfer "A Sale". If the thing you're buying has a publicly verifiable (albeit dubious/preposterous) market value, you aren't even committing fraud!
Jarwain 6y ago
Resale of an NFT is different; since you can look up previous owners of the NFT there's a way to validate "yes this NFT is the one originally sold by Elon". The NFT has value Because it was the one Elon sold and signified as legit, versus the NFT some random person sold
- sporkologist 6y ago
  Yeah but it's still "Elon's 2nd hand NFT"

Jarwain 6y ago

I think if Jeff Bezos decided to sell an NFT of Elon's first tweet, there would be more value there compared to if some random person sold an NFT representing the same thing

capableweb 6y ago
Correct, but maybe you're missing the point if that's your first thought. It now becomes "The NFT that Jeff Bezos made of Elon's first tweet", not the "Elon Musk NFT of Elon Musk", both obviously much more "interesting" (for human reasons? I don't know, don't care) than the "John Smith NFT of Elon Musk"

maxerickson 6y ago

If Elon can sell his own tweet NFTs better than anybody else can, that's a pretty good argument that they are gonna be a novelty and not some new form of art exchange. Because what are the buyers of the Elon-tweet NFTs gonna do when they decide they want something else for their 'value'? They are gonna try and sell the Elon-tweet NFT and find out that they lack legitimacy!

wmf 6y ago
You're misunderstanding the argument. Elon can create the NFT due to his legitimacy, but subsequent trading of those NFTs doesn't require legitimacy because ownership is tracked on the blockchain.
- maxerickson 6y ago
  No, I'm mocking the whole idea, I understand the difference between origination and selling. I do legitimately think that novelty is a big factor, and buying an Elon-tweet NFT from some random guy is gonna have way less novelty value than buying it from Elon.
  - wmf 6y ago
    I agree. Overpaying for NFTs is like performance art; the value isn't in owning the NFT itself.
    - headmelted 6y ago
      Doesn’t “overpaying” imply that there’s an inherent value that’s non-zero? I’m not saying there is or there isn’t, but I’m not sure how that would be discerned. There’s a marketplace for artwork - is there a marketplace for tweets? Also, doesn’t Twitter inherently hold the rights to the content on it’s platform? (Or at the very least a license to reproduce the content indefinitely?). Maybe Twitter is the legitimate party here, if such a thing even exists.
    - funcjb 6y ago

kybernetikos 6y ago

To me it seems that NFTs could include some part of the bundle of IP rights that typically go along with an artistic work. For example, the artist could create a license that allows only the current owner of the NFT to make a physical copy, or a right to be credited whenever a physical copy is exhibited or something like that. I suppose I'm thinking in terms of what an ultra rich person gets from owning a famous artwork, if they then lend it to a public gallery and allow everyone to see it - I presume it's the right to have a little card next to it that says 'on loan from the collection of X'. I think NFTs could provide something of the same experience for 'owners' of digital assets.

Animats 6y ago
To me it seems that NFTs could include some part of the bundle of IP rights that typically go along with an artistic work. One might think that. One would usually be wrong. Read the terms for Top Shot or Mintable.
- kybernetikos 6y ago
  I meant it more as a suggestion than a description of how things are currently. But i did look up top shot. It's interesting that they do mainly operate through the use of special licenses to make use of the artwork.

headmelted 6y ago

I struggle to find legitimate use cases for NFTs - and I say this with confidence that it’ll age like warm milk. That said, the one really obvious use case that jumps out at me is in-game loot. At least the inherent value of the NFT is tied back to something that people may want but otherwise can’t just copy-and-paste on their own. The only problem with the above is that it doesn’t benefit publishers to allow third parties to freely buy-and-sell commercial content without a cut, so I can’t see why they’d ever go for it.

wmf 6y ago
The smart contract could give a cut to the publisher. But ultimately if an NFT can only be used in one game why not just store it as a database entry on the game server?
- capableweb 6y ago
  > But ultimately if an NFT can only be used in one game why not just store it as a database entry on the game server? That's the nice thing. Once you've created something with the ERC721 interface, it can be used in multiple places. Let's say you attach a hash pointing to a .glTF 3D object as well, and now multiple games can share the same items between them. Imagine buying a in-game hat in Counter-Strike and later bringing it to Fortnite. Silly? yes, but also useful in that world of sillyness and fun? Yes.
- headmelted 6y ago
  Exactly this, but my thinking was that it might have some value to the publisher to build a marketplace around the content. As an example - games like Fortnite, Warzone and Apex Legends rely on loot as the sole driver of revenue. Having in-game rare items freely tradable akin to the trading card concept that NFTs are constantly compared to could have value in itself. If I’m a real fan of one of those games and I stumble upon a diamond-encrusted level 100 golden sniper rifle (sorry I’ve no idea what a good example of a rare item is in one of those games), then the money someone may pay for that is (e.g.) $1k. Giving me the ability to sell that on to someone could not only drive publicity for the game (EVE online made world news years ago because of the real monetary value lost in their battles) but encourage me to play that game over rivals as there’s perceptible real-world value for my invested time and effort. The downside I was thinking of above is that the publisher may not want to enable that for a bunch of reasons - the suggestion above sounds like a good way to resolve their revenue on the transactions, but the status quo of the items being non-transferable may be preferable as they’ll overall sell more loot directly to individual customers under the current system.