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I'm glad there was a summary, but less happy about the contents of the summary. Seems the author misunderstands the core idea behind NFTs and blockchains in gen

I'm glad there was a summary, but less happy about the contents of the summary. Seems the author misunderstands the core idea behind NFTs and blockchains in general. As a disclaimer: I'm generally pro-cryptocurrencies but I see zero value in today's uses of NFTs, seems mostly to be about moving funds around in a opaque way. Here is the summary they included in their post: > NFTs don’t prove ownership — ordinary legal contracts are just as good, and in fact better since they are heavily regulated and can be taken to courts for a central resolution when problems arise > Blockchains (which NFTs rely on) are in the best case no more secure than ‘normal’ relational database storage systems, and in most cases are less secure > Cryptocurrencies have no innate value and are only useful as a pyramid scheme, something big crypto influencers are knowingly using to profit from those who don’t realise it > Both cryptocurrencies and NFTs cause high environmental damage, and there are no viable systems to deal with this problem due to security considerations No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. Saying that blockchains are less secure than a relational database storage points towards not understanding immutable ledgers with shared state at all. They both have different use cases, that much should be obvious if you understand the basics of both blockchain and relational databases. Things that people value has value. That value is decided by what people think the value is. I don't understand art, especially not "high-art", but somehow people value it, that's fine by me, people like different things. But then I agree, cryptocurrency "influencers" are horrible. Follow the people developing the software instead, those are real and honest people (mostly). And finally: no, cryptocurrencies and NFTs doesn't cause "high environmental damage" as those are concepts, not implementations. One implementation of consensus that is used in cryptocurrencies is Proof of Work, that is harmful to the environment, at least current implementations. There are other implementations of consensus, like Proof of Stake, or Pure Proof of Stake, who have their own drawbacks but have almost no environmental impact (compared to Proof of Work).

hartator 5y ago
> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. Is it a fact? You can just fork the full cryptopunk blockchain and reassign tokens whichever way you want. And we're just back at the exact same issue to have to go regular contracts and courts if you want to enforce ownership or legitimacy of the actual blockchain.
- capableweb 5y ago
  Yes, because if you understand forks, you'll understand that just because you fork something doesn't mean that you are now the thing you were forking. Instead, you're a new incarnation of the thing you forked. For example, if someone forked ffmpeg and started making their own improvements on top of that fork without contributing back the changes, that is now something else than ffmpeg, while ffmpeg still remains ffmpeg.
  - hartator 5y ago
    > that is now something else than ffmpeg, while ffmpeg still remains ffmpeg. Except that I can't call my ffmpeg, ffmpeg; because of the trademark. Whereas I can call my crytopunk, crytopunk. And if crytopunk has to register a trademark to defend it, it defeats the whole purpose of NFT as we are back to our regular court system.
    - capableweb 5y ago
      I'm not talking about the name "ffmpeg" specifically, but the project itself. You can call your project the same as what you forked, but if it's on your own forked chain, it's not the same project.
echelon 5y ago
> Saying that blockchains are less secure than a relational database storage points towards not understanding immutable ledgers with shared state at all. If I crack your Bitcoin keys, your money is mine. Nobody is going to restore your property. If I hack into a bank or rob you at an ATM, police will come and get me, and the judicial system will put me in jail. Crypto is stateless. Lawless. You can't own math. You just have a solution to a problem that you haven't shared with anyone. And if someone with compute resources cared, they'd take it away from you.
- fsflover 5y ago
  Crypto simply does not rely on a third party, which is both its advantage and disadvantage.
  - echelon 5y ago
    This is such a libertarian hyper dream. In this world, unless you live in the wilderness without tools and supplies, everyone depends on others to some degree. Crypto is an attempt to greedily cut others out and play god. The more plebs you convince of your world view, the more powerful you become. Meanwhile you do nothing of value for society. Just waste brilliant minds and power.
    - rodiger 5y ago
      The point isn't to not depend on anyone else for anything, instead it's to unwind some of the dependency assumptions we've built up over time. Many in the world don't have access to a financial system. If they have internet, now they do (assuming they can find some way to onboard). Beyond that, plenty of financial tools only were accessible to the ultra-rich/institutions. Many of those are now accessible to everyone. May be worth taking a step back to see why brilliant minds are intrigued.
      - fivea 5y ago
        > Many in the world don't have access to a financial system. If they have internet, now they do (assuming they can find some way to onboard). If anyone has access to the internet, they have access to banking services. I mean, there are internet banking services being offered in Burundi and Mozambique, two of the poorest countries in the world.
acdha 5y ago
> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. Most of the NFT marketing I've seen is very fast and loose about this — people will talk like it's owning the item but only when pressed will admit that it means owning the NFT pointing to the item. > Things that people value has value. That value is decided by what people think the value is. I don't understand art, especially not "high-art", but somehow people value it, that's fine by me, people like different things. This is conceding the author's point: a hash on a blockchain has no innate value and being the purest form of a fiat currency with weak backing means that nobody has a strong reason to need them. Nobody buys a hash because they like the pattern of ones and zeros. > no, cryptocurrencies and NFTs doesn't cause "high environmental damage" as those are concepts, not implementations. One implementation of consensus that is used in cryptocurrencies is Proof of Work, that is harmful to the environment, at least current implementations. There are other implementations of consensus, like Proof of Stake, or Pure Proof of Stake, who have their own drawbacks but have almost no environmental impact (compared to Proof of Work). When the most popular cryptocurrencies used are not PoW, this will be more convincing. Right now it's Bitcoin, Ethereum, and a rounding error.
- tshaddox 5y ago
  > Most of the NFT marketing I've seen is very fast and loose about this — people will talk like it's owning the item but only when pressed will admit that it means owning the NFT pointing to the item. But that’s totally reasonable. No one is going to misinterpret that unless they’re deliberately being uncharitable. This is just a normal usage of imprecise language, not very different than saying you own a house when technically you have a mortgage, or saying you bought an album on iTunes when technically you bought a revocable license to play the album under certain restrictions.
  - acdha 5y ago
    Have you seen anyone talk about “right-clicker mentality”? There are a ton of people who are surprised that NFTs have no claim on ownership or access restriction because everyone's talking about it as if they're something other than a vanity URL.
SkyMarshal 5y ago
> cryptocurrency "influencers" are horrible. Follow the people developing the software instead, those are real and honest people (mostly). Just want to /second this sentiment. There are hard problems and interesting work being done in cryptography, distributed systems, etc in the blockchain world. It's why it's attracted a number of the best universities to create dedicated research centers - MIT, Stanford, Cornell, etc.
ladyattis 5y ago
>No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. This is irrelevant to the wider world which doesn't even have basic infrastructure to support blockchain smart contracts. Without that infrastructure you have a curiosity, not an asset you can use as collateral with a bank.
- carlosdp 5y ago
  Willing to bet places that currently don't have the infrastructure to connect to a blockchain reliably also don't have functional legal systems to enforce ownership of physical assets / property.
zp333 5y ago
> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. what if i steal your private key? what if i upload a different NFT smart contract that gives me an NFT of the same image you have?
- tantalor 5y ago
  If you steal the key then you own it. That's what "owning it" means; you have the key.
- capableweb 5y ago
  > what if i steal your private key? As another commentator said, the key demonstrates the ownership so you're the owner now. Sometimes that's a bad thing indeed, but blockchains are very unforgiving at their core protocols. > what if i upload a different NFT smart contract that gives me an NFT of the same image you have? First off, images have nothing to do with NFTs and vice-versa. Yes, some NFTs links to images but those are uninteresting and hype-driven (or I don't understand it). Once a NFT has been created, you cannot replicate it as it's a single instance of a token (hence the name "non-fungible").
tmaly 5y ago
I think it is only a matter of time till a dispute over NFTs goes to court and some aspect of contract is established.
nodamage 5y ago
> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. I think the author's underlying point is: what is the value in having proof of ownership on a blockchain if it does not correlate to real world ownership in any meaningful sense? The cited example makes this clear: if you steal someone else's art, turn it to an NFT, and then sell it to a third person, the buyer does not actually own the underlying rights to the artwork because you never had the right to sell it in the first place.
rstuart4133 5y ago
We have had an analogue of NFT's for 100's of years. Title deeds for land and buildings. The correspondence is pretty good. In most places in the world title deed fraud is roughly a yearly occurrence. It typically happens like this: some poor sod goes on overseas holiday for a year or two. Some fraudster notices, and somehow convinces the title's office they own the dead. The banks, lawyers and everybody else accepts that as proof of ownership, so they are able to see the house and pocket the money. When our victim returns to discover someone else in their house, and find out why, they attempt to sue someone. That's when they discover the governments generally make the titles office "all care and no responsibility", ie the can't be sued. So they've lost everything, with no recourse. Here is one example: https://www.businessinsider.com.au/gazumped-how-criminals-are-stealing-and-selling-homes-out-from-under-their-owners-in-australia-2014-8 https://www.businessinsider.com.au/gazumped-how-criminals-ar... So the title deed is absolutely a proof of ownership. The congruence actually goes deeper - saleable land is created when the government creates a title deed for it at the titles office, and what the title office really does is just record the transitions of ownership. Sounds remarkably like a bitcoin, doesn't it? Sadly it proving you own a title deed isn't done anywhere near as securely as proof of ownership of a bitcoin is done, or indeed proof of ownership of an NFT. Because of that I think we can safely say one day in the distant future, title deeds will become NFT's. It will happen in the future because as they say in physics, progress happens one death at a time. NFT's just extend the title deed concept to other things. It is much easier to conduct commerce when you don't have to bring the car or cow to the auction, just a bag of bits you can cryptographically prove you own it. To think of it another way, we already do NFT like exchanges of commodities such as pork bellies. No one actually sees the pork belly. In fact if you are dealing in futures, the pork belly doesn't even exist. But nonetheless, we create pieces of paper asserting they exist, or will exist, and trade them. Turns out futures are very useful to farmers and the like, giving them some certainty over the price they will get their crop - before it exists. But once you realise we happily trade prices of paper now that assert ownership over things that literally don't exist yet, you will probably understand the proof of ownership thing he is getting worked up about isn't the huge problem he thinks it is. This ease of trading mostly only existed for commodities. The vast bulk of things we trade aren’t commodities. NFT have brought the frictionless commerce we associated with commodities to whole new classes of goods. Before NFT’s, turning something into a commodity that can be traded required an enormous amount of YAK shaving. You had to define precisely what it was, ensure there was already a large market, create the trading platform - for all I know it might even have required an act of parliament. Now anybody can attach a bag of bits to anything, and it's actually easier and cheaper to trade than a futures contract. It’s true they did that by making the proof of ownership thing not their problem. The NFT's solve the crypto and trading side, only. Proving and accepting ownership is left as an exercise to be solved by the buyer and seller. But it's not the show stopper problem he makes out. Really, it isn't.

hartator 5y ago

> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. Is it a fact? You can just fork the full cryptopunk blockchain and reassign tokens whichever way you want. And we're just back at the exact same issue to have to go regular contracts and courts if you want to enforce ownership or legitimacy of the actual blockchain.

capableweb 5y ago
Yes, because if you understand forks, you'll understand that just because you fork something doesn't mean that you are now the thing you were forking. Instead, you're a new incarnation of the thing you forked. For example, if someone forked ffmpeg and started making their own improvements on top of that fork without contributing back the changes, that is now something else than ffmpeg, while ffmpeg still remains ffmpeg.
- hartator 5y ago
  > that is now something else than ffmpeg, while ffmpeg still remains ffmpeg. Except that I can't call my ffmpeg, ffmpeg; because of the trademark. Whereas I can call my crytopunk, crytopunk. And if crytopunk has to register a trademark to defend it, it defeats the whole purpose of NFT as we are back to our regular court system.
  - capableweb 5y ago
    I'm not talking about the name "ffmpeg" specifically, but the project itself. You can call your project the same as what you forked, but if it's on your own forked chain, it's not the same project.

echelon 5y ago

> Saying that blockchains are less secure than a relational database storage points towards not understanding immutable ledgers with shared state at all. If I crack your Bitcoin keys, your money is mine. Nobody is going to restore your property. If I hack into a bank or rob you at an ATM, police will come and get me, and the judicial system will put me in jail. Crypto is stateless. Lawless. You can't own math. You just have a solution to a problem that you haven't shared with anyone. And if someone with compute resources cared, they'd take it away from you.

fsflover 5y ago
Crypto simply does not rely on a third party, which is both its advantage and disadvantage.
- echelon 5y ago
  This is such a libertarian hyper dream. In this world, unless you live in the wilderness without tools and supplies, everyone depends on others to some degree. Crypto is an attempt to greedily cut others out and play god. The more plebs you convince of your world view, the more powerful you become. Meanwhile you do nothing of value for society. Just waste brilliant minds and power.
  - rodiger 5y ago
    The point isn't to not depend on anyone else for anything, instead it's to unwind some of the dependency assumptions we've built up over time. Many in the world don't have access to a financial system. If they have internet, now they do (assuming they can find some way to onboard). Beyond that, plenty of financial tools only were accessible to the ultra-rich/institutions. Many of those are now accessible to everyone. May be worth taking a step back to see why brilliant minds are intrigued.
    - fivea 5y ago
      > Many in the world don't have access to a financial system. If they have internet, now they do (assuming they can find some way to onboard). If anyone has access to the internet, they have access to banking services. I mean, there are internet banking services being offered in Burundi and Mozambique, two of the poorest countries in the world.

acdha 5y ago

> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. Most of the NFT marketing I've seen is very fast and loose about this — people will talk like it's owning the item but only when pressed will admit that it means owning the NFT pointing to the item. > Things that people value has value. That value is decided by what people think the value is. I don't understand art, especially not "high-art", but somehow people value it, that's fine by me, people like different things. This is conceding the author's point: a hash on a blockchain has no innate value and being the purest form of a fiat currency with weak backing means that nobody has a strong reason to need them. Nobody buys a hash because they like the pattern of ones and zeros. > no, cryptocurrencies and NFTs doesn't cause "high environmental damage" as those are concepts, not implementations. One implementation of consensus that is used in cryptocurrencies is Proof of Work, that is harmful to the environment, at least current implementations. There are other implementations of consensus, like Proof of Stake, or Pure Proof of Stake, who have their own drawbacks but have almost no environmental impact (compared to Proof of Work). When the most popular cryptocurrencies used are not PoW, this will be more convincing. Right now it's Bitcoin, Ethereum, and a rounding error.

tshaddox 5y ago
> Most of the NFT marketing I've seen is very fast and loose about this — people will talk like it's owning the item but only when pressed will admit that it means owning the NFT pointing to the item. But that’s totally reasonable. No one is going to misinterpret that unless they’re deliberately being uncharitable. This is just a normal usage of imprecise language, not very different than saying you own a house when technically you have a mortgage, or saying you bought an album on iTunes when technically you bought a revocable license to play the album under certain restrictions.
- acdha 5y ago
  Have you seen anyone talk about “right-clicker mentality”? There are a ton of people who are surprised that NFTs have no claim on ownership or access restriction because everyone's talking about it as if they're something other than a vanity URL.

SkyMarshal 5y ago

> cryptocurrency "influencers" are horrible. Follow the people developing the software instead, those are real and honest people (mostly). Just want to /second this sentiment. There are hard problems and interesting work being done in cryptography, distributed systems, etc in the blockchain world. It's why it's attracted a number of the best universities to create dedicated research centers - MIT, Stanford, Cornell, etc.

ladyattis 5y ago

>No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. This is irrelevant to the wider world which doesn't even have basic infrastructure to support blockchain smart contracts. Without that infrastructure you have a curiosity, not an asset you can use as collateral with a bank.

carlosdp 5y ago
Willing to bet places that currently don't have the infrastructure to connect to a blockchain reliably also don't have functional legal systems to enforce ownership of physical assets / property.

zp333 5y ago

> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. what if i steal your private key? what if i upload a different NFT smart contract that gives me an NFT of the same image you have?

tantalor 5y ago
If you steal the key then you own it. That's what "owning it" means; you have the key.
capableweb 5y ago
> what if i steal your private key? As another commentator said, the key demonstrates the ownership so you're the owner now. Sometimes that's a bad thing indeed, but blockchains are very unforgiving at their core protocols. > what if i upload a different NFT smart contract that gives me an NFT of the same image you have? First off, images have nothing to do with NFTs and vice-versa. Yes, some NFTs links to images but those are uninteresting and hype-driven (or I don't understand it). Once a NFT has been created, you cannot replicate it as it's a single instance of a token (hence the name "non-fungible").

tmaly 5y ago

I think it is only a matter of time till a dispute over NFTs goes to court and some aspect of contract is established.

nodamage 5y ago

> No one claims NFT proves ownership of entities outside of the used blockchain. But within the chosen blockchain, they do prove ownership of that particular NFT. That's a fact. I think the author's underlying point is: what is the value in having proof of ownership on a blockchain if it does not correlate to real world ownership in any meaningful sense? The cited example makes this clear: if you steal someone else's art, turn it to an NFT, and then sell it to a third person, the buyer does not actually own the underlying rights to the artwork because you never had the right to sell it in the first place.

rstuart4133 5y ago

We have had an analogue of NFT's for 100's of years. Title deeds for land and buildings. The correspondence is pretty good. In most places in the world title deed fraud is roughly a yearly occurrence. It typically happens like this: some poor sod goes on overseas holiday for a year or two. Some fraudster notices, and somehow convinces the title's office they own the dead. The banks, lawyers and everybody else accepts that as proof of ownership, so they are able to see the house and pocket the money. When our victim returns to discover someone else in their house, and find out why, they attempt to sue someone. That's when they discover the governments generally make the titles office "all care and no responsibility", ie the can't be sued. So they've lost everything, with no recourse. Here is one example: https://www.businessinsider.com.au/gazumped-how-criminals-are-stealing-and-selling-homes-out-from-under-their-owners-in-australia-2014-8 https://www.businessinsider.com.au/gazumped-how-criminals-ar... So the title deed is absolutely a proof of ownership. The congruence actually goes deeper - saleable land is created when the government creates a title deed for it at the titles office, and what the title office really does is just record the transitions of ownership. Sounds remarkably like a bitcoin, doesn't it? Sadly it proving you own a title deed isn't done anywhere near as securely as proof of ownership of a bitcoin is done, or indeed proof of ownership of an NFT. Because of that I think we can safely say one day in the distant future, title deeds will become NFT's. It will happen in the future because as they say in physics, progress happens one death at a time. NFT's just extend the title deed concept to other things. It is much easier to conduct commerce when you don't have to bring the car or cow to the auction, just a bag of bits you can cryptographically prove you own it. To think of it another way, we already do NFT like exchanges of commodities such as pork bellies. No one actually sees the pork belly. In fact if you are dealing in futures, the pork belly doesn't even exist. But nonetheless, we create pieces of paper asserting they exist, or will exist, and trade them. Turns out futures are very useful to farmers and the like, giving them some certainty over the price they will get their crop - before it exists. But once you realise we happily trade prices of paper now that assert ownership over things that literally don't exist yet, you will probably understand the proof of ownership thing he is getting worked up about isn't the huge problem he thinks it is. This ease of trading mostly only existed for commodities. The vast bulk of things we trade aren’t commodities. NFT have brought the frictionless commerce we associated with commodities to whole new classes of goods. Before NFT’s, turning something into a commodity that can be traded required an enormous amount of YAK shaving. You had to define precisely what it was, ensure there was already a large market, create the trading platform - for all I know it might even have required an act of parliament. Now anybody can attach a bag of bits to anything, and it's actually easier and cheaper to trade than a futures contract. It’s true they did that by making the proof of ownership thing not their problem. The NFT's solve the crypto and trading side, only. Proving and accepting ownership is left as an exercise to be solved by the buyer and seller. But it's not the show stopper problem he makes out. Really, it isn't.