I am very critical/skeptical of more or less all things crypto, but I heard an interesting point from an artist recently who had begun selling NFTs of their work. It is in line with the thinking around the Rolex example in the article, but in my opinion, more salient:
I asked them about what appeared to me as the inherent silliness of selling an "exclusive" tokenized image, which could be easily copied with a right-click for free. Their response was that this is essentially no different from print making. When you buy a print, you are buying something you have the means to produce yourself. You aren't paying for the quality of the print making materials--you could order identical prints of the image from a print shop, or if you're less concerned with quality, simply print at home.
But when you buy a print from the artist, you're paying for that signature that says "#3 of 100." There's nothing stopping the artist from printing more, and there's nothing stopping random people from duplicating the print, but we're comfortable with the idea that a signature confers a "uniqueness" to the print that makes it valuable.
I don't know if that is an argument against print making or a case for NFTs, but I found the point interesting.
I sometimes wonder if they get that there's no "THE blockchain".
I mean, an NFT would tend to exist on a particular blockchain. If that blockchain forks (e.g., [as Bitcoin's done a number of times](https://www.investopedia.com/tech/history-bitcoin-hard-forks... )), then it's not unique, but rather exists multiple times -- potentially with different copies being owned by different folks. Plus folks could create duplicate NFT's of the same (by simply minting new ones), presumably on the same blockchain or/and others. And then, if an NFT is reliant on external-resources (like links to a host-server), as I've heard that most are, then presumably those could break and even if someone continues to "own" an NFT on some particular blockchain, the NFT itself would seem decontextualized and essentially meaningless.
Then, durability isn't ensured even on a continuous blockchain, as blockchains can elect to remove stuff (e.g., through forks or filter-protocols). Presumably blockchains would ultimately want to truncate historical stuff; it'd seem strange to assume that an NFT would necessarily be carried through such a process.
Then there's the non-optimality of primitive blockchains. This is, when there're innovations, we'd presumably expect folks to create new blockchains that may displace older ones, retiring prior-NFT's in the process.
Then if we're talking long-term, historic value, then we'd probably consider stuff like advances in cryptography mooting the original signatures, and just generally how ancient blockchains would seem to be of little interest to those in the future. Plus, I'd imagine that advanced AI artists would render the concept of trivial art being in any way non-arbitrary obsolete.
Long rant short, it's just weird to hear non-technical folks seemingly believing that blockchains confer "uniqueness" outside of more limited, subjective contexts.
How would you simply mint a new copy of an nft? I thought the point was their uniqueness, hence the non fungible part of the name. By copy are you referring to having the same payload/url/whatever?
Satoshi proved that any blockchain that isn't currently the leader won't be mined and therefore will fall into disuse. Anyone who read the paper understands this, the principle of what's called Bitcoin maximalism.
So if you want your money/NFTs/whatever to continue to be secure in future, there is ultimately only going to be one global blockchain, singular, so it's very much correct to use the term "THE blockchain".
If this weren't HackerNews, where sarcasm is heavily discouraged, I'd assume that you were being very sarcastic. But since this is HackerNews, I'm confused.
I mean, surely anyone who knows anything about blockchains would be aware that the long-term plans, even among traditionalists, would involve an ecosystem of interacting chains. And then presumably folks with some level of technical understanding realize that even a singular ecosystem's overly naive. I doubt few people actually believe in Bitcoin-maximalism, outside of memetic-humor. ...right?
Sorry, I'm still confused about junk like flat-Earthers. I mean, I've known flat-Earthers who were straight-up committed trolls; they were committed to the bit and would actingly-angrily denounce the round-Earth conspiracy, but they most definitely didn't actually believe that Earth was flat. But.. other folks.. it was harder to tell; were they even more committed, or did they actually believe that Earth was flat? Anyway, a lot of blockchain-stuff's similar -- I get that a lot of folks are trolling, but are there really true-believers who're legitimately sincere?
Bitcoin is possibly the most important bit of engineering since the Manhattan Project.
You may not have any interest in fixing the world but some people do.
Bitcoin takes energy. You can't use that energy for two things at once. You can't mine Bitcoin and Ethereum at the same time. The market for mining one squeezes out the other. A blockchain is only as secure as the game theory backing it.
Then why do we currently have many blockchains? Plenty of people preferred making their own new blockchain where they were in control instead of just working on the bitcoin blockchain.
> But when you buy a print from the artist, you're paying for that signature that says "#3 of 100." There's nothing stopping the artist from printing more, and there's nothing stopping random people from duplicating the print, but we're comfortable with the idea that a signature confers a "uniqueness" to the print that makes it valuable.
I'll bite: I also find 'limited editions' with no unique characteristic to be idiotic.
If they have some unique characteristics, whether it's a LE book with a different cover illustration and fancy binding or a LE Ferrari with a specially-tuned V12, then they're actually rare objects and it's fine.
But if your artist's print is 100% identical except for that "#3 of 100" signature, I wouldn't pay one more cent for the privilege of owning that signature. Same with autographs on books or CD/vinyl covers. Picasso and Hendrix were interesting people and artists, but there is nothing particularly interesting about their signatures and they don't improve the painting or CD in any way *.
Paying hundreds of dollars for a perfectly ordinary book that some sweaty fan brought to an exhausted author at an event to have him quickly scribble "John Q. Author" on it is, in my opinion, exactly as pointless as paying hundreds of dollars for a NFT of that book.
* Some trivial exceptions: if a painting's author is disputed, the signature can help solve the dispute. And some artists do have interesting signatures (e.g. Dali). For the vast majority of 'limited prints' neither consideration applies.
How is that different from the current art market where you can already buy some painting with a high degree of confidence that it's an original, numbered, signed by the artist, etc.
Blockchain does not add more confidence to these kind of transactions. You still need middleman to authenticate the art, that it wasn't stolen or whatever.
Writing ownership in a blockchain, why not, but for all the famous crypto use cases (real estate, concert tickets, art, etc.) these only solve a very small part of the problem (if there is one to solve...) and I don't see how you can cut all the middleman that are always here for a reason.
With a good quality physical fake it can be hard for even the artist themselves to know if they made it.
An NFT, they know for certain without question if they minted it or not. That’s the whole schtick. You have a jpeg or whatever provable signed by the artist. Sure you can make copies, but those copies are provably not signed by the artist.
For me the main issue is do I care? Leaving aside the: "which Blockchain/NTF represents the real image" issue, you actually have to give a crap about that stuff. That's where the value lies. I'm not sure most people do.
the main use case is not an oil or acrylic painting but digital art and digital media. look at highest sales on any platform its memes, gifs, JPGs, digital photographs, 3D renderings, videos, generative art. there was no easy way to distribute signed editions of digital media in limited capacity and have it certified by the artist themself, the only option was to make it a signed physical print which is not a digital substrate.
the only middleman you requires is blockchain indexer like etherscan or TheGraph or an alternative , and if you do not trust those platforms you can run your own local node as the data is not owned by any single entity.
It’s trying to replicate some medium (world of atoms) properties unto another medium (world of bits) which provides a wild different perspective (scarcity is not the rule).
If anyone wants to play the scarcity/exclusivity game, fine.
There are better, more efficient solutions/means than crypto and nft for this already.
> There are better, more efficient solutions/means than crypto and nft for this already.
lol people like to repeat this without pointing to any solutions.
with crypto art an artist can sign their cryptographic key on a transferable and ownable digital asset published on a distributed ledger, set its scarcity and supply, and then use the blockchain as a sales and auction mechanism without requiring an intermediary auction house to handle escrow like sothebys or christies.
what is the proposed alternative for these digital media?
Art certificates, both physical and digital have existed for… ages?
And even the NFT frenzy is a good opportunity to market a « new », « better » Dropbox-like integrated solution, that’s supported in the long run and enables small artists to be as well autonomous on this.
Edit: seriously. Selling NFTs as a solution for art certificates sounds like an American coming in France to sell the concepts of bread and cheese.
> Art certificates, both physical and digital have existed for… ages?
and they are generally pretty crap? easily lost, forgeable, destroyed, manipulated, unrecognized.
typical certs require a centralized "Certificate Provider" who upholds their value, for example a major auction house might distribute a cert when selling a painting. in crypto art there is no centralized authority that maintains the veracity of the tokens as the provenance and ownership lies in the distributed ledger.
for those who wish to achieve similar goals as a digital cert but with more cryptographic robustness and less reliance on a centralized actor, NFT is a fine approach. that it has sales and market mechanisms built in is a bonus and probably the reason for its booming success as a new digital art market.
How are NFTs, or any crypto assets, better in that regard?
The independance from a centralized auth (house auction, bank, law court) is rather moot, because that's what you need to have to investigate, solve and guarantee dispute resolutions (lost, stolen, forged, impersonated assets, unfaithful transactions, illegal transactions, etc.).
Moreover, cryptos exchanges today _do_ act as few centralized points of control.
You still can lose NFTs, lose control on them. You can still have your own artwork being minted by someone else, even against your own will (and to control against that abuse, you will need some sort of central authority somewhere).
You can still forge or impersonate artists.
You can manipulate people on their actual value versus the value of the thing they represent (that is, owning an NFT on an artwork today provides no guarantee of owning any right on the artwork itself).
And that's not even taking into account the energy burnt into it.
you can forge a cert or a painting by copying it. a good forgery can be very convincing and requires expert investigation. see Salvator Mundi in which the authenticity of the painting is still not clear despite years of investigation by countless art historians and conservationists.
if you try to copy a token you will end up with a new cryptographic hash and a new history of transactions associated with it. there are countless clones of crypto punks for example, but the only one that has any real traction is the one that has a clear history of transactions associated with its contract hash. anybody who can tell the difference between two strings of characters can detect whether a token is a forgery or not, it does not take an expert.
yes obviously centralized exchanges are centralized, they are not the ones upholding the ledger or crypto art certs. even crypto art platforms like Foundation and opensea do not own or uphold the certs being issued and indexed by their platforms. it is more like the way that google indexes search results, it doesn't own the websites on its search results.
yes impersonation is possible but often easy to detect on-chain. if a supposed notable artist is suddenly minting new work from a public key different than the address they've used in the last two years, suspicion would be warranted.
> anybody who can tell the difference between two strings of characters can detect whether a token is a forgery or not, it does not take an expert.
Yes, but the value is not in the token, it's in the art itself. You don't own anything but the NFT itself, not the artwork it refers to. Artwork that goes public domain 50/75 years+ after the artist death anyway (and is way easier to replicate than physical artwork/copies).
As for exchanges. Banks and auctions do not uphold things either, they're the same kind of operators of principles they don't write, they are merely applying the rule of law and use their credentials for that purpose.
As for impersonation, NFTs-as-certificates are of no impact for notable artists, who already have teams and networks that do this work for them (with old or new techs).
Easy/manageable/controllable art certificates really have an impact when available first to small and emerging artists (because that's the crucial when and where they do need this kind of foundations and support for their living).
the value is in the limited edition asset signed and distributed by an artist. you can verify this by taking the Beeple PNG and re-minting it yourself to see if others value it the same way. or you can take any popular artist's or photographer's signed print like Damien Hirst and create a copy without a signature to see if people value it.
banks and CEX both have nothing to do with the topic of certification of art. neither a bank or CEX upholds the cert.
interesting that you say NFT-as-certs have no impact for notable artists yet there are a variety of notable artists using NFT-as-certs. see: Hirst, Koons, Pace gallery all using NFT. the nice thing is that this tech is available to all, whether you are a notable artist like Hirst or just an illustrator or pixel artist, such as @jmw327.
In less than a century, your Beeple PNG and Hirst photograph will be in the public domain. Free to copy, reuse, whatever, without exclusivity.
But, yes, you will still have an exclusive, costly certificate. Just a certificate.
In less than a century, the public domain art will still have admirers, remixers. The certificate itself will hold no value to no one. It's literally a depreciating speculative asset.
See: today, who cares as much about whoever funded it and how, than about Mozart's Requiem?
Would this have been funded through an exclusive certificate at the time, apart from being a museum artefact of a bygone era, it would not be worth much. The music is still studied, performed, derived, listened to.
I'm not an artist and I don't understand art, beyond liking something tangible with an aesthetic that appeals to me.
So I'll buy prints, or originals, that I like, and that I don't mind looking at every day, and hang them on my wall. I have no objection paying a reasonable price for them either - artists have to eat.
The issue I have with NFTs is that they are not art. They are just vessels signifying financial worth. The worth of a painting, a print to me is aesthetic, not financial. But there is no aesthetic worth in an NFT. I can't hang it on my wall. I can't enjoy it every day.
So if we treat NFTs as tokens of value without any artistic worth, they become no more than a variant of another cryptocoin, albeit a 'unique' coin worth $XXX, and by decoupling the artistic argument from the financial argument, all the 'silliness' goes away. It's simply a store of value.
Only you have the print in your position. An NFT is like buying a ticket which gives a deed of ownership to a specific print of a specific book. The book itself is available in public for anyone to read for as long as the original seller cares to look after it.
Prints and NFTs are very different. You will very rarely be able to print it yourself because high quality copies will not be available to you. You also wouldn’t expect a print to have resale value. You are buying it because it looks nice on your wall. Not as an investment.
NFTs are still a load of crap. Im glad some artists found a way to make money off them, but that doesn’t make them any less of a scam.
artist prints are routinely forged and resold. this is such a problem in high end artists work like Hirst that they must find complex ways to certify and authenticate their signed prints. sometimes this is with holographic stickers, or separate certificates of authenticity, or even non NFT blockchain certification.
most signed prints are not bought because of what the content is, but because of the signature. you can buy unsigned prints of many notable artists work for 20 bucks while the same signed version sells at sothebys for thousands.
users should not expect NFT to have any more or less resale value than a signed print. but because there is currently a market for it, it is easier to sell a token than a print. in future this may change if tokens are as commonly distributed and purchased as prints are.
> artist prints are routinely forged and resold. this is such a problem in high end artists work like Hirst that they must find complex ways to certify and authenticate their signed prints.
NFTs make this problem worse. E.g. OpenSea is awash with stolen art and removed the ability to contest the problem several months ago.
the blockchain allows anybody to publish nfts that point to any media, so naturally there is a lot of spam and copy-minting. anybody can publish to OpenSea a Picasso NFT but this does not mean it will be valued by the market as a Picasso. the same is true of an impersonator trying to mint a new Pak or Beeple or whoever you think is a popular nft artist.
almost all of these "thefts" come in the form of social engineering and impersonation rather than forging the token itself. and if you look at the data, 99% of these copy-mints are not actually selling and are not making any impact in the market.
a copy-mint of crypto punks is trivially easy to discern as a fake because its contract hash will be uniquely different than the crypto punks contract, which has a long and clear historical trail associated with it on chain. if a copyminter starts to post new work that resembles a popular artist like Beeple, it will be under a new public key hash or address, and also easy to discern.
compare this crypto art copy-minting to paintings like Salvator Mundi which countless experts have been investigating for years and still are not able to discern the authenticity of the painting despite its $450 million price tag.
> does not mean it will be valued by the market as a Picasso
There are innumerable examples of digital art being sold on OpenSea without any knowledge of the original authors, but presented as if it was from the original authors.
> almost all of these "thefts" come in the form of social engineering and impersonation rather than forging the token itself.
It literally doesn't matter if the token is forged. The theft is there, and NFTs (and blockchains in general) have literally no mechanism to prevent it.
> a copy-mint of crypto punks is trivially easy to discern as a fake because its contract hash
You keep pretending that stealing art is the same as stealing/forging the token that points something
> compare this crypto art copy-minting to paintings like Salvator Mundi which countless experts have been investigating
Who. Cares.
There's an irrefutable fact: NFTs provide literally zero protections against art theft. It's gotten so bad that sites like DeviantArt now have automated tools to find stolen art on sites like OpenSea and report it to original artists.
you are right: it is trivially easy to publish any media file and assign an NFT to it and then list it for sale, and there is a lot of copyright infringement as a result.
all of these articles claim widespread theft and stolen work, but a surprising lack of data on how much of that is actually sold considering all of those payments should be publicly traceable on the blockchain.
imagine putting a Damien Hirst image on OpenSea only for nobody to purchase it. is this a complex form of art forgery and art theft? in some cases this process is automated by bot-scripts scraping DeviantArt, and the end result is like spam mail. maybe there is a buyer naive enough to purchase your Hirst image thinking it is authentically from the artist, and in that case I sympathize just as I do when an unsuspecting user falls for an email scam.
it is also trivially easy to look at these scam tokens and realize they are not from the authentic collection they claim to be, or that the minter does not match the artist's public address, or that the artist is not even claiming to make nfts and therefore a nft of their work is unlikely to be authentic.
if you look at art forgery in traditional media, not only is it rampant but it actually accounts for millions of dollars per year, and many high value paintings do not have a clear provenance and authenticity as this information is easily lost and altered over the course of history.
> all of these articles claim widespread theft and stolen work, but a surprising lack of data on how much of that is actually sold considering all of those payments should be publicly traceable on the blockchain.
Payments, yes. But not provenance. Because you'd have to find all the artists, then all their work, then sift through all the listings at OpenSea, and cross-reference that. Because the following statement from you is a blatant lie:
> it is also trivially easy to look at these scam tokens and realize they are not from the authentic collection they claim to be
No. It's impossible to say whether something is from a legitimate artist or not.
> if you look at art forgery in traditional media, not only is it rampant but it actually accounts for millions of dollars per year
NFT scams are significantly more rampant because stealing a digital image trivial. As is pretending someone you're not.
Quote:
"DeviantArt has sent 90,000 alerts about possible fraud to thousands of their users since then, company executives said. It’s now scanning for fraud across 4m newly minted NFTs each week. The number of alerts doubled from October to November, and grew by 300% from November to mid-December." [1]
> Because the following statement from you is a blatant lie ... It's impossible to say whether something is from a legitimate artist or not.
lol, have you ever looked at the chain? if an artist has been minting work for 1 year on the same public address and then suddenly somebody purchases a lookalike token from a different public address there is a high likelihood it is a copymint. you can avoid this by comparing the addresses, it does not take an art history expert to detect this form of copyminting.
many platforms will show attribution based on address and username. so if the artwork is attributed to b33ple.eth instead of beeple.eth then it is likely a copymint.
> DeviantArt has sent 90,000 alerts about possible fraud to thousands of their users since then, company executives said
it’s clear copyright infringement, but easily detectable to the point that DeviantArt is able to automate their search, and not a sophisticated form of forgery. still you are not able to provide evidence of significant funds being consistently lost here despite it being so prevalent, especially when you compare to trad art forgery where you can easily find evidence of millions of dollars per year being mistakenly spent on forged artworks.
it is like Nigerian prince email scams. part of the protocol that some unfortunate and naive users might fall for, but most users will learn to recognize and avoid this problem in time.
> if an artist has been minting work for 1 year on the same public address
No ifs. There artists right now whose work is sstolen and sold without their knowledge
> many platforms will show attribution based on address and username. so if the artwork is attributed to b33ple.eth instead of beeple.eth then it is likely a copymint.
Ah yes. And you know the exact addresses and the exact attribution for all hundreds of thoudands of digital artists, right.
> it’s clear copyright infringement, but easily detectable to the point that DeviantArt is able to automate their search
No. It's not "easily detectable". It's detectable because DeviantArt hosts some digital artists, and they still have to lookup, download and analyse 4 million OpenSea submissions a day, and match them against 350 million images in the DeviantArt database.
And that is a tiny fraction of all the digital art in the world. Besides, if it was so easy, show me a single NFT marketplace that automatically takes down stolen art.
> naive users might fall for, but most users will learn to recognize and avoid this problem in time.
And how exactly are they going to recognize the problem? E.g. someone sells NFT of an image that you like. What are the exact steps to find out if it's legitimate? Keep in mind that there are hundreds of thousands of people producing millions of images across hundreds of thousands of websites and platforms.
you are making it seem like it is difficult to tell a David Hockney NFT is a fake. step one: does the artist have a clear history of minting associated with an address? if no, and the artist is not making any claims to making nfts, then most likely it is a fake. if yes, and the artist is promoting the nft at that address, it is probably not a fake.
in the case of Hockney as he has been expressly against nfts and has never publicly made one, a fake is easily detectable. in the case of Beeple who has been expressly for nfts, it is easy to authenticate as it will be associated with his address.
despite knowing so little about art market and art history that you’ve never heard of the world’s most influential and highest sold living artists, you can probably still make a rational guess that this NFT collection is a copymint. perhaps the fact that the artist never once mentions or links to the collection from their Instagram profile acts as a hint.
this is what I mean by “trivially easy” compared to art forgeries in the real world, which do take professional art historians and years of study, and yet still leaves many of them fooled.
it’s worth noting that the collection has not sold, and very likely never will.
> despite knowing so little about art market and art history that you’ve never heard of the world’s most influential and highest sold living artists, you can probably still make a rational guess that this NFT collection is a copymint
Demagoguery
> perhaps the fact that the artist never once mentions or links to the collection from their Instagram profile acts as a hint.
So, you're basically saying that you have no idea whether either Instagram or OpenSea page actually belong to the artist and it's impossible to find out if they do or do not.
The argument "they didn't sell anything" is moot because, again, there are hundreds of thousands of digital artists producing millions of images, and not all of them are "famous minting more than a year and you know what they say about NFTs off the top of your head"
A print, especially a classic gelatin silver B&W or c-print, is something the artist has ostensibly personally labored over. It is as much a product of their craft as the original source material was, whether that was a negative, positive, digital image, or PSD file.
most artists will hire professional printmakers and printers. just because a photographer is good at shooting does not mean they are good in the dark room.
when we talk about editioned prints, most of the effort is not in the print. a screen print takes a couple hours to make, an Epson print is a click of the button. but the work being printed might have been built from years of practice as an artist.
> I still have an iPhone, which came out 13 years ago - blockchain also came out 13 years ago. The iPhone has changed the world in that time, but crypto has not. It has searched for a use case and the one use case it’s really found is extortion.
The computer science behind cryptocurrencies and decentralized ledgers and ownership blockchains are all interesting and cool to think about. But outside of computer science, on the social and economic plane, all of this is a pile of shit.
> [C]ompanies like Rolex spend a lot of money on enforcement to get rid of counterfeits because counterfeits remove the willingness for people to play to pay the high price for an original.
An interesting scene from the movie House of Gucci (2021)[1] is when Patrizia Reggiani (Lady Gaga), the wife of Maurizio Gucci (Adam Driver) discovers the fake bags you can buy on the street and tells Aldo Gucci (Al Pacino) who is then the family brand leader.
The point Aldo makes is: The distribution of fakes strengthens the brand, because it gives normal people a belief that they can own a Gucci bag. They know their bag is fake, their peers may or may not know, but they still advertise for the real bag and the belief that if you're affluent, you want a Gucci bag. The brand would be worth very little if only the people who could afford it cared to speak of it.
I stopped paying too much attention to NFT image arguments and started looking at blockchain technologies. Things like Arweave, IPFS, EPNS. These are very interesting projects that I started some draft blog posts about.
Also, I do think people are graduating from owning an “image” to seeing them as tickets to something greater.
I was a web3 skeptic. You can probably see it in my comment history. However, I really wanted to understand it more and focusing on infrastructure parts that get less media attention is where I’m finding my home. Call it web3, distributed, p2p… whatever. There is some really cool stuff being built that solves things in a novel (to me ) way. I wish more engineers were looking into this from a purely intriguing set of engineering examples.
There are interesting distributed protocols out there, but they fundamentally have nothing to do with "blockchain". For example IPFS which you mention.
What so many people take exception with isn't distributed protocols, P2P, etc. — it's the corruption of these useful, existing technologies to intertwine them with an ecosystem of artificial scarcity metered in cryptocurrencies. This latter is what people call "web3" now.
If I make the world's greatest pure-P2P WebRTC application that stores permanent data on IPFS, no web3 proponent will get excited about that because it doesn't include magic beans that could make them rich.
To add to this, yes, distributed computing is full of really cool stuff. It's been pumping out tons of solutions to real-world scalability problems for decades.
I get the feeling that a bunch of people are just now coming into the conversation with no knowledge of this, and thinking that Blockchain == distributed computing, like it's the first and only kind of distributed algorithm ever to exist or something.
Fair, although I would definitely bucket IPFS in the blockchain category in that it is targeting that community of developers.
Also, IPFS isn’t a solution for storing data permanently. Arweave is and I think people would be very excited about that. At least I would if that’s any data point.
No magic beans necessary to get me excited. Just cool tech. I can’t be the minority but maybe.
This makes many factually incorrect statements, over generalizations, and is filled with emotion. I don’t know where to start.
Tim Berners-Lee doesn’t own the term “web 3(.0)”.
Miners/validators charge a fee. Any cloud provider also charges a fee. DIY isn’t free either.
I’ll ignore DeFi because I know it doesn’t necessarily sit well with HN, but there are valid use cases for blockchain in Gaming.
10 years is a long time, yes. But there are a lot of things that need to be built, tested, and adopted. Blockchain moves slowly. So what?
Comparing anything to the iPhone is a terrible argument. The iPhone is arguably the biggest success (design, marketing, need) of the last 25 years and comparing anything to it doesn’t tell us anything other than “yes, iPhone good”.
there are valid use cases for blockchain in Gaming
If you mean the usual example of "you could buy a 3d model of a hat, and use it in all your favorite games" then you have no idea how 3d asset pipelines work and why this is never going to happen except maybe within the realm of a single publisher, and if that's the case there's no need for a blockchain. You could just store them on an account that's probably using Postgres in the background somewhere.
or, you can buy a trading card for a game that embraces blockchain and decentralization. the media which is a PNG and JSON can be stored in ipfs , p2p hosted, and licensed with CC0.
this is a niche .. but you can imagine some communities and players might enjoy owning assets that are not tied to a game company. the company can fold and the game go under, and the asset can still be repurposed for another game, or held as a collectible like we do physical trading cards and stamps.
a probably simpler use case for blockchain in gaming is for a simple payment API and market mechanism .. easier to spin up a smart contract and escape payment processor fees and the ridiculous take-rates of Steam and Apple in-app purchases.
I can't see how that is desirable in the slightest. People who like to play with trading card games don't enjoy the artificial scarcity part, they accept it as a necessary evil enforced to them by the manufacturer. I don't think any Magic the Gathering player enjoys telling their friend how expensive it is to get into (all of my friends play Pauper even if they own fetchlands, fwiw)
it does not have to be expensive. it can be that the entire year of play cost you $10 USD to purchase all your cards, or it could be that you acquired your game loot just through playing for days on end in RPG-like boss drops and not spending anything.
scarcity is part of these games. when you open a pack of MtG cards and one item is rare, player will tend to get pretty excited. same with a rare loot dropped in WoW. without this imposed scarcity all assets would have equally unlimited supply and the game would probably be pretty bland, and there would be not as much reason to trade cards and build a hand.
> without this imposed scarcity all assets would have equally unlimited supply and the game would probably be pretty bland, and there would be not as much reason to trade cards and build a hand.
Completely false. The strategy game and the collection/trading 'game' are completely different activities, and it is extremely common to enjoy one but have no interest in the other.
I played MTG very competitively in my youth, and I sidestepped the scarcity issues entirely by either playing sealed/draft[0] in official tournaments, or by playing in unofficial online tournaments where cards were unlimited (I enjoyed the so-called Eternal formats where many cards had been long out of print and cost hundreds of euros at the time).
Pro players also tended to favour drafting - it had a reputation as the most strategic and interesting way to play - and while of course they also played in official tournaments with custom-built decks, quite a few of them were known for having no interest in collecting cards and simply borrowing whole decks from their friends who did have the hobby of trading and collecting (whether or not those friends played the game).
[0] A game mode where everybody starts with a small set of random cards, instead of bringing their collection.
maybe this depends on the game and players. I have seen a lot of MtG folks take pleasure in having a carefully curated deck with some cards that are more rare and coveted than others, and even hold onto these cards years later when they aren't playing any more because they have some sentimental value to them. if supply were unlimited then every player would just have every card in the game.
it is like WoW loot where some items are rare and others are not. if all items in the game were of equal supply and scarcity, there would be no rare or coveted items. you could trade a bronze dagger for a legendary mythril great sword or whatever. after 100 loot drops from grinding you'd have 100 different items of equal rarity rather than say 95 worthless items and 5 rare items.
i guess that is a valid type of game but it seems different than most trading card games and loot based games.
True collectors do exist who collect something purely because it's rare. In MtG the most obvious example are 'misprint' fans who enjoy collecting cards that got accidentally printed off-center, or upside-down, or in the wrong colour. The rarity is literally the only thing those cards have going for themselves, as they're usually mediocre or unplayable in the game itself.
True collectors do exists, but they are outnumbered 1:1000 by ordinary players who sigh and say "oh man, I'd love to play $card, it's perfect for my deck, but I don't have the money for it, this shit sucks".
Modern video games have found a satisfactory compromise by allowing everybody to enjoy the game on a level playing fields without restrictions, and then using cosmetics to bait the collectors into getting addicted, with all the dark patterns we know and loathe - artificial scarcity, FOMO, etc.
If MtG took the same lesson to heart and released every year a 'play set' where you can pay like $50-$100 to get all the new cards needed in regular form, and then had separate randomized products for collectors with a chance at shiny or alternate art versions, I'd get back into the game on the spot.
if scarcity is not needed or desirable for MtG players why would they not just release all cards individually for the same price? why should any card be harder than another to acquire?
if MtG uses this model for deck building it sounds like pay-to-win.
a blockchain game can just be pay-to-own and play-to-own like most games on the App Store, except the assets assigned to the user is not attached to a single App Store account and do not involve a 30% take fee. imagine these game assets could still be held even if you switch from Apple to Google phone, because the assets are detached from your phone company’s accounts.
> if scarcity is not needed or desirable for MtG players why would they not just release all cards individually for the same price? why should any card be harder than another to acquire?
Because it's desirable for the publisher? Since, you know, they make way more money that way.
> if MtG uses this model for deck building it sounds like pay-to-win.
It is pay-to-win, up to a point. There is an upper ceiling on how much a top-tier deck can cost to acquire (usually a few hundred dollars, in the most popular formats), and after that point money no longer confers an advantage. That's how it can be a competitive game at all, even when you bring your own deck.
> a blockchain game can just be pay-to-own and play-to-own like most games on the App Store, except the assets assigned to the user is not attached to a single App Store account and do not involve a 30% take fee. imagine these game assets could still be held even if you switch from Apple to Google phone, because the assets are detached from your phone company’s accounts.
Very nice - for the player. Why would the game publisher, Google, or Apple want to make an effort to recognize assets from a blockchain they do not control and do not profit from?
so re: MtG, this goes back to my original point. most of the game depends on scarcity. I was recently informed about proxies where users can print their own cards, but it still sounds like the majority of players value the cards themselves rather than just a self printed version of it. apparently there is something special about "owning" MtG card rather than just a proxy
> Why would the game publisher, Google, or Apple want to make an effort to recognize assets from a blockchain they do not control and do not profit from?
they don't and probably will not do this, unless it starts to compete with their profits. this is what we are seeing with nfts in art world, llike Christie's and Sotheby's now selling nfts, Instagram and Meta adding nfts, and now Spotify announcing they will explore nfts. these corporations see value that they can extract, in the same way opensea is extracting 2.5% on each trade and as a result making millions in profit.
if more gamers begin to use and demand decentralized marketplaces for games and assets, the major publishers will step in to those spaces as well to try and keep their foothold and avoid becoming obsolete in a new market.
lol, players saying NO to reducing the take-rates of app stores from 30% to 0-2.5%, and saying NO to having the assets they purchase stored anywhere besides the privately owned servers of their favorite centralized megacorps
Yes because so far, they've experienced 100% of the issues (lack of moderation, wild exploitation with no way to get un-scammed, lack of consistency and clarity) and 0% of the benefits (you could tax something 100% its value and still be way below gas fees).
People don't care how little control they have over it, the shift from having retail games in your own home to owning them on platforms like Steam (and the resistance from buying from other sources) should tell you enough.
you are probably right, but I will not be so pessimistic as to resign to favouring Steam and Apple stores and take rates as a necessary evil and permanent facet of the web’s future. I am happy to see web3 at the very least attempting to challenge this, however weakly it is currently being done.
Mtgo have limited supply, and even my old splinter twin which were my favorite cards in the world 10 years ago i don't care about. Paper assets are different than digital ones I think. Especially if you only pay for it and didn't work on them.
a probably simpler use case for blockchain in gaming is for a simple payment API and market mechanism .. easier to spin up a smart contract and escape payment processor fees and the ridiculous take-rates of Steam and Apple in-app purchases
The payment processor fees are still there though - you just pay them when you convert your fiat currency into crypto, rather than when you use the crypto to buy the 3D hat.
nope. if a game publisher uses a CEX to exchange the crypto they receive from users into fiat and direct bank account deposit the fees can range from 0% to 0.6% compared to 2-5% for stripe and PayPal or up to 30% for steam and apple. this also does not consider per-transaction fees which in L2 will be very minimal and allow users to engage with micro payments like $0.25 USD asset purchases, which are not realistic with stripe APIs.
edit: these fees apply both ways, selling and buying crypto, so the user also pays less. and if the user buys $100 USD of tokens like they would at an arcade, all of those tokens can be spent on the game without exchange to fiat needed. this is different than every interaction with processor taking a cut which happens now if you want to buy 5 assets from a game that uses stripe or an app store or whatever.
if a game publisher uses a CEX to exchange the crypto they receive from users into fiat and direct bank account deposit the fees can range from 0% to 0.6%
The only reason the fees are that low right now is because crypto is speculative, and users have no protections. If crypto is useful and buyers expect to be able to do things like refunds or charge backs the fees will do up to cover those costs.
Looking at how crypto works right now and suggesting it'll still be the same if people use it as currency is silly.
equally silly to assume that regulations will force all centralized exchanges to charge 2-5% or 30% as is the case with current payment processors and app stores. that is not going to happen except in totalitarian countries.
the reason those standard take-rates are high are not for consumer protection. interbank fees are about the same or lower as CEX take fees in the range of 0.1-0.5%. corporate infrastructure built on top of these financial systems like PayPal, Stripe and VISA are taking huge profits.
> the asset can still be repurposed for another game
Can it? NFTs don't confer copyright, there are all sorts of issues with that. If the original company goes under, rights to its assets are likely to be part of either acquisition or bankruptcy proceedings.
this is why i say CC0 licensed assets and why the game and publisher has to embrace decentralization. also why this type of usage will be niche and apply to a specific type of game genre.
CC-NC license also sorta works but not as well.. assets can then be repurposed for non commercial uses only.
other licenses should be developed to operate specifically on these kinds of problems. some projects are already exploring this like BAYC licensing token owners more rights.
look at it this way: anybody can google images of the rarest MtG cards and print it out on paper, and bring that to play with. but the other player will probably frown on that. because both players have bought into the idea that the "cards" not the JPG image that makes them is what has value in the gameplay.
the same is possible in blockchain setting. ownership of that unique token can hold value for gameplay and collectibility, despite JPG being CC0 and free to download and print out.
> look at it this way: anybody can google images of the rarest MtG cards and print it out on paper, and bring that to play with. but the other player will probably frown on that. because both players have bought into the idea that the "cards" not the JPG image that makes them is what has value in the gameplay.
This is not true. Concerning "value in the gameplay", as you put it, the value is in the JPG. The "card" might have a value as a collectable but that value has no bearing on "value in the gameplay".
if the value is in the JPG or "image" then anybody can print it at home and play with it in competition. but it is not the norm. likewise, nobody has a collection of self-printed MtG JPGs in their attic, but they do have collections of "cards" which hold sentimental value to them.
For information, you can play proxies in some competitive MTG games if you prove you have the card. And in less known games like vampire CCG, proxies are allowed in tournaments without proving anything (and imho it makes that game even more competitive, and allow players to modify their deck at will depending on the clans/player at the table.
this is where blockchain is well suited. user can sign a message with their private key and cryptographically prove ownership where all other parties can also verify it cryptographically
> proxies are allowed in tournaments without proving anything
cool! but not what most refer to when talking about trading card games. if you have access to all cards in the game at any point there is no need to trade or do anything in particular to acquire and own a specific card except to say “I choose that.” if a game works like that it wouldn’t make sense to build blockchain based ownership around it.
> anybody can google images of the rarest MtG cards and print it out on paper, and bring that to play with. but the other player will probably frown on that.
Wizards of the Coast frowns on this, and bans it in sanctioned tournaments because obviously they want to sell you cards. Actual players do it literally all the time and it's not even very controversial.
agree, but that is not the game I am describing. many free to play iOS and Apple games use an in-app purchase model and users are fine to pay $1-2 to add new skin or expand their play. in those cases the assets are locked to your apple account, and also include a 30% take fee.
acquiring an nft does not even need to include payment at all. assets can be distributed to users for non monetary reasons, such as some achievement or action taken in the game, or defeating some other player in a pvp battle based on a mix of skills and random chance and as a result winning their hand or rare loot or whatever. it is up to the game to decide these things.
> acquiring an nft does not even need to include payment at all. assets can be distributed to users for non monetary reasons, such as some achievement or action taken in the game, or defeating some other player in a pvp battle based on a mix of skills and random chance and as a result winning their hand or rare loot or whatever. it is up to the game to decide these things.
You've literally described how games work now. No NFTs required
yes, games and game stores hold records of ownership under your account. some of that may be purchased, some of it may be acquired through another means like an in-game achievement.
nfts are literally just records of ownership of a digital asset that are upheld without a central entity.
“it’s a lot like owning assets in a game” is exactly correct with the distinction that it’s decentralized
the only need for NFT in a game is decentralization and disintermediation of payment and ownership. if you wish to distribute game assets and give players a form of transferable and scarce digital ownership that is not locked into a walled corporate garden, CC0-licensed NFT represents one approach.
OK, but then again, I'm not seeing the utility of an NFT on a public blockchain, apart from the mythincal "I get to use it in other games" thing, which is only going to work in games with "free" art assets - vanishingly few.
as I said in my original post: this is a niche application. some share of users will be happy to own and trade CC0 licensed assets that are not centrally owned by a single game company, and not sitting in their steam or apple account.
similarly, some share of devs and gamers like to publish and purchase work on Itch.io, even though it’s the minority compared to Steam or Apple.
If the NFT is, say, an image. Different games could definitely pull the image(url) from the blockchain and use it in their specific game. Multiple games could share it in that way.
That's not actually right unfortunately. Things like resolution, color depth, alpha channels, compression formats, gamma correction, and meta data all impact whether you can use an asset between game engines. Some things can be automatically corrected for or just ignored, but if you want to have an image displayed identically between different games, or apps, or OSs, or even browsers it's basically impossible.
I think you and I are building up explanation backwards from an instinct that assets can’t be shared across games.
Images are hotlinked across the Web all the time, the problem is that random assets cannot be added to a game.
And the people pushing NFTing assets might have a different idea on games - e.g.(I’m open to refinements) the “game” is understood to be more heavy on game mechanics as seen in game of chess, so that 3D model of a piece can be anything, or that an asset is always a complete, tangible entity as a fully voiced and textured Companion Cube, rather than a husk of a car in the background with half of the body removed, etc.
And with that level of disagreement as deep as to what the game is, I’m not sure how we would all get to an agreeable conclusion. A chess game that allows any pieces in a Unity asset bundle as a piece sounds interesting if possible.
> I think you and I are building up explanation backwards from an instinct that assets can’t be shared across games.
It's not instinct. It's an fact obvious to anyone who as much as had a tutorial on game programming.
> the “game” is understood to be more heavy on game mechanics as seen in game of chess, so that 3D model of a piece can be anything, or that an asset is always a complete, tangible entity as a fully voiced and textured Companion Cube, rather than a husk of a car in the background with half of the body removed, etc.
So, tell me. How exactly will this work with "game mechanics" with an "always complete asset" etc?
> A chess game that allows any pieces in a Unity asset bundle as a piece sounds interesting if possible.
Of course it's not possible. Or, if somewhat possible, will look like shit for the majority of assets: you can't convert a 2D pixel art asset to a 3D object; 3D (and many 2D) assets will have completely different compositions, skeletons, rigs, animations etc.
> or a game based on chess.
Not a game based on chess, THE chess. A game engaging enough that the whole UI/UX can be just added or replaced. Think GNU chess, but with an argument that takes a magnet link for background.png. I think that is kinds of games that "NFT as game assets" idea is targeting. Not a modern game at all.
I mean, I could have said that NFT believers' mental model of a game is so removed from computer games IRL, AAA and gacha and mobile and all kinds of games, that those concepts make basically 0.0E-16 sense or in case it make sense the point those paths cross is few decades away. Basically that's my thinking. But isn't that too dismissive?
The chess/rimword/elden ring comparison doesn't really make sense. You're assuming any game that allowed NFTs would simply load ANY NFT?
Twitter, for example, allows some set of NFTs to be used on their website. Those NFTs are from a specific place (OpenSea) and follow a specific criteria (be an image).
Like that a single game would connect to some place (GameNFTs) and allow for example a user to select their chess pieces if they owned an NFT in a specific category (GameNFTs::Images::ChessSets::TypeA). But it wouldn't allow other NFTs than that.
> You're assuming any game that allowed NFTs would simply load ANY NFT?
That's what crypto bros keep telling us.
> Those NFTs are from a specific place (OpenSea) and follow a specific criteria (be an image).
So, a very limited set of NFTs from a centralised service. Got you.
> Like that a single game would connect to some place (GameNFTs) and allow for example a user to select their chess pieces if they owned an NFT in a specific category
So
- there would be a central asset authority
- that authority would oversee asset categorisation (or this categorisation will somehow be standard)
- game devs will willingly integrate with that central authority's API to find, list, and accept game assets
And the reason game devs will do that and are not doing it already is because?
I'm not a crypto bro so this is a more realistic take on how you can get actual NFTs into games. Yes, it has massive trade offs that would make the whole thing very roundabout, but I am simply arguing for that it is technically possible.
> I am simply arguing for that it is technically possible.
It's still not even remotely possible (except for games running more or less the same engine and implementing the same type of game like the Crusader Kings series). But even before we get to that, my last question remains: "And the reason game devs will do that and are not doing it already is because?"
> It's still not even remotely possible (except for games running more or less the same engine and implementing the same type of game like the Crusader Kings series).
Yes, and that's my whole point. It can be done, just not as general as the bros have you believe.
> But even before we get to that, my last question remains: "And the reason game devs will do that and are not doing it already is because?"
Because there is no benefit to the game developer.
It's possible to load assets from remote, it's basically not possible to provide meaningful value by allowing assets foreign and out of context to individual games. Thus the point being made is close to moot...
That still doesn't make it impossible, does it? The shared resource server would have a set of requirements, and the engines would have to work with that. It would also be an opt-in scenario, so if a game decided they wanted to be a part of this, they simply would work with it. It's not like games would be forced to use it.
Again, I am not saying it is a good solution, but displaying a PNG in multiple games from a shared location for /sure/ is possible.
displaying a PNG in multiple games from a shared location for /sure/ is possible
No doubt you can display it obviously, but you can't ensure that it's identical everywhere, especially where the thing displaying it is implemented by separate teams of developers. PNG has built in gamma correction. It's a good example of a format that displays differently depending on where you're viewing it. Game developers would be swamped with support requests saying "My special hat NFT is just a black rectangle!"
And that's just for 2D images. If you want to do it for 3D assets... Well, trust me, you really don't.
Blockchain, NFTs, and all related ideas are about sharing data between untrusted parties without a central authority. If you're in a single game there is automatically an authority.
I'll be generous and suggest that World of Crypto is being built by some devs who are using NFTs as a hustle because they're trendy. There's nothing wrong with that. That's how you sell things in fashion. But it could easily be a rugpull scam...
That period also excludes all the work and progress in phones it took to get there.
> I’ll ignore DeFi because I know it doesn’t necessarily sit well with HN
DeFi is revolutionary. The idea of programmable finance and bank which can be created by anyone (we have 12 year old engineers with complex defi financial products) is nothing short of eye watering. On top of it, all the primitives are composeable which makes risk stacking possible. That's capital efficient for the capital owner compared to tradfi.
You can criticise the grifters in the space which are too many but what it enables is amazing to me.
Loaning items sounds like at most a weeks worth of work. Building in blockchain technology sounds like months worth of work.
All of this works better and faster on a normal database. All of the additional features marketed are just the removal of intentional restrictions by the developers. Why would the developers want to give up this power and if they did, they could do it without blockchains.
Loaning is just one potential use. The idea is that if you were to put ownership of items on a blockchain then you open up your game to all the external tools/marketplaces that have been built.
Who on earth is going to put ownership of game items on a blockchain?
There's a huge difference between "I own a level 28 sword of whacking in this game" and "I own the copyright to this level 28 sword of whacking and all the art-assets related to it".
I can't see many game designers selling the copyrights along with their fancy outfits, frankly.
Devs still have to build blockchain functionality. Which one of the hundreds if blockchains?
And devs still have to build things like "ownership of item changed, reflect it in the game", "this guy is a member if a clan in game X, so has to be member of clan X(?) in this game" etc.
The hand-wavy way crypto proponents approach this is maddening.
Yes, there will likely always need to be some work done on the dev side to enable any of those use cases. A lot of the tools/services to enable these and other uses are either being built or haven’t even been started yet, so for the moment the level of effort from individual teams is higher than it could be.
Trading game assets is a billion dollar industry in web2. CS:go skins, robux, etc.
By building on blockchain, you can save work building trading systems and enable cross-pollination (Take advantage of all the tools and bridges because of composeability).
a lot of web3’s critical infrastructure like ipfs, TheGraph and Infura, scalable L2s, and zk proof tech is all far more recent and still in development so it will probably still be another few years before it matures i think
No other technology platform has been so denigrated and ridiculed
Web3 is very likely to fail because a substantial proportion of both the tech and business space think it’s a load of unnecessary nonsense backed by fraudsters or the gullible who think they can get rich fast and want nothing todo with it.
To be fair, it IS a load of unnecessary nonsense backed by latest bandwagon jumpers, fraudsters and the gullible who think they can get rich fast. There's no technical merit to it.
> No other technology platform has been so denigrated and ridiculed
As far as I am concerned it's entirely deserved. Web3, NFTs, etc. are a cancer and should not exist. It's on the same tier as DRM and pop-up ads.
"Web3" is just a new label to make it seem like the same old bullshit is somehow novel and revolutionary.
First "blockchain" was the future, it was the next big thing, it was a revolution, it was going to change everything, you'd be a fool not to get involved. Sure, there might not be a lot there yet, but it's like the Internet in 1994 - this is only the beginning!
If they were still saying the same things about "blockchain" then people would notice that these lofty promises have delivered nothing for ten years. But give it a sexy new name like "Web3" and now it feels new again, even though nothing has changed, and they can continue to entice people in with the same old promises. Sure, Web3 doesn't seem to have produced much yet, but this is only the beginning. It's like the Internet in 1994!
Nothing that came out of crypto, nfts or web3 impresses me. I love new tech in general, and I go “that’s nice” a lot, but it feels like problems looking for solutions. The problem is mostly people trying to push it like the “new economy” in the early 00s, just before it crashed.
The way I see it though is it's a solution looking for a problem.
"Look, we can build a decentralized database."
"Wow, let's try and use this to replace EVERYTHING"... and yet so far it has replaced nothing.
The most basic and obvious use cases – a Venmo replacement, a credit card replacement, and sending money across borders – these are all still done the traditional way, and it doesn't seem like that's about to change.
I'm hoping to be proven wrong, especially for the credit cards use case. Would be nice if everything cost 3% less. But it doesn't appear to be on the horizon.
Eh, the fees on cards are a bit of a myth. Not that they don't exist, but their impact. Particularly in IRL transactions. Sure, a cash transaction doesn't cost the merchant 3% straight off, but it does pile on extra banking costs, extra security costs, extra staff time to handle cash etc.
But sure, it would be nice to have a cheaper way with similar guarantees for online transactions. The alternative is usually bank transfers, but with those, if you get defrauded it's on you, so I quite like CCs for that.
Also in a lot of countries fees are capped way lower than 3%...
The article doesn't mention it, but software devs are gamers. Cryptomining has made video cards expensive and hard to get, so that along with sheer brain deadness of building a system built around wasting electricity... anger seems like an appropriate reaction
I don't play videogames and know very little about crypto mining, but isn't the mining being done on specialised hardware these days and not GPUs? Are GPUs still being wasted on crypto nonsense?
Given the continuing high price of video cards these days, I'm going to say yes, many people are still leveraging GPUs for mining.
EDIT: Maybe not as much as previously, but still enough to have a noticeable impact on the market.
I don't know if it is web3 or not, but there are a lot of interesting things you can do when you have the whole consensus record permission less digital scarcity thing that blockchain architectures provide.
Theres a project called Golem that I was interested in some years ago that allows you to buy and sell hash power in a permissionless way. Right now there are data centers and big providers, it's basically impossible for a little guy to get in on that market. But a system that allows anyone to contribute to a pool of compute and anyone to buy compute like a commodity is an interesting thing. And there's no gatekeeper or middleman, compute providers and purchasers are matched up algorithmically.
There's something called "liquidity pools" that enable trade to occur without order books. This is a major, major fintech advancement.
Another one is triple entry bookkeeping, which is impossible without these systems.
Just the fact that the byzantine general's problem has a workaround (not entirely a solution) that's shown practical use for a decade is enough for me to call this a fantastic technological achievement.
I'm sure there are more that I can't think of. I don't use the term web3 because 99% of shit marketed under that banner are scams, and the term itself is misleading, and the line around the meaning of the term is amorphous. But this whole cryptocurrency world has brought some really interesting things.
Important to note that you can only borrow it with greater value of collateral (in the form of other crypto assets).
If you want to borrow $100m USDC, you need to post $100m of something else (e.g. BTC), which can then be liquidated if the value changes.
There is definitely a case for this (financial speculation, aka shorting one asset by borrowing and selling it), but I think the largest "legitimate" (not tied to hacking, or ransomware) case that's also not speculative (shorting or decentralized leveraging) is simply to avoid a big tax bill.
In other words if you bought a few thousand BTC 10 years ago and never sold, you don't have to pay capital gains in many jurisdictions if you just use it as collateral to borrow USDC.
Personally I'd be happy to pay taxes on a massive windfall like that (and also wouldn't want to hold BTC long-term due to the environmental effects)
But there are (unfortunately, in my opinion) a lot of anti-government, sovereign citizens, and libertarian types in the crypto space as well.
The value of collateral that you’d need to put up would presumably be greater than the borrowed amount, just denominated in a different token. What would be the use case for a regular person?
Basically, “you can borrow” if you already have a few hundred million already, and want to gamble with it.
Why would web3 be capable of anything else? Satoshi invented the blockchain to solve one specific problem: creating a decentralised currency. It was never supposed to be some kind of universal "truth machine" applicable to any other kind of real-world problem. How would it? The existence of data on a blockchain doesn't prove anything except that some data was added to a blockchain. The idea that this has practical applications for anything other than a currency (e.g. supply chain management, concert tickets, property deeds, all the other classic examples that cryptoheads have been citing for years without a single successful example in real life) is absurd, in fact it's so laughably absurd that I question the intelligence of anyone who can say it with a straight face.
Basically, I think that everything in the crypto space is bullshit, with the possible exception of Bitcoin itself, but I'm still agnostic on that front. I hope I'm wrong - it's appealing to think that we're on the cusp of another technological revolution that will make everything better, especially if it gives me a chance to get rich! - but for fuck's sake, it's been five years since this classic article and still nothing has fundamentally changed: https://hackernoon.com/ten-years-in-nobody-has-come-up-with-...
If an asset doesn't live exclusively the blockchain, the blockchain can't enforce its ownership. If the blockchain can't enforce its ownership, it doesn't have anything else to offer.
One small corner of potential I still see is running some low-volume Internet services with a blockchain as a backing store. There was a bit of a buzz a few years ago around distributed DNS, and it seems to fit the criteria to me. The asset itself (DNS records) is a tiny set of key-value pairs, so it can feasibly be stored on the blockchain itself. Clients can look up the blockchain directly, if operating a node is cheap enough, or use middleman servers.
I think it's fine technically, but adoption is going to be a problem. On the plus side, the current administration of this centralized resource (ICANN), has its fair share of opponents and critics[0] - of course it is extremely debatable whether an ancap-style decentralized market would be preferrable, nevertheless there is an existing group of unsatisfied users who have reasons to look at alternatives.
And snce adopting an alt-DNS doesn't mean you need to drop your traditional DNS records, there's no real cost to jumping in.
On the other side, clients will only see added value if your site *isn't* available on the ICANN DNS network, and that's a long shot. Worse, you need a 'killer app' of a site to make people switch to a different DNS system, but realistically a site isn't going to grow big enough without being available on the traditional DNS in the first place. You'd need a few major sites to announce that they're pissed off with ICANN (for example due to a high-profile name dispute) and that they're moving to an alternative DNS. Fat chance of that.
To put it more bluntly - if IPv6 is still having trouble with adoption, what chance does decentralized DNS have?
Not disagreeing with anything you're saying here but rather adding the conversation:
> There was a bit of a buzz a few years ago around distributed DNS
DNS is already distributed: records are aggressively cached across the internet. It's globally scalable and it works pretty well. There's security issues with it that we could fix (most of which we could fix without blockchain).
A blockchain-based DNS gives us what? It has the advantage of removing the "admin rights" from name registrars. This definitely sounds desirable but it comes with an obvious, massive burden/baggage: in order to retain those byzantine properties, everyone who wants to look up a DNS record has to have a multi-terabyte blockchain file locally downloaded and verified. The pro doesn't outweigh the con. And delegating to a cache brings us back to where we already are now.
I disagree: delegating to a cache isn't a major problem, when the single source of truth is public and relatively easily accessible. A DNS server censoring or tampering with DNS requests is already trivially detectable now by comparing it to other servers, and it would be even easier to detect when anybody can operate a "full" DNS node with a $50 hard drive and a fiber connection.
This is frankly ridiculous. The interviewed dev complains that web3 makes everything pay to play. If anything, web3 makes it explicit that the internet has become a place that is purely pay to play. Just today you pay with your data and you don’t know the prices.
So I'm skeptical of web3, I dig cryptocurrency but all this nonsense about NFTs and metaverse and whatever is just that, nonsense.
But there is one glaring mistake in the article, and one I often see in arguments against web3, that is the idea that the internet becomes some pay to play thing.
First of all, running services costs money. Running services for free costs money, it just doesn't cost you money. So you're asking someone to either do you a solid, or get paid another way. And 9 out of 10 times they choose the latter, and track you and sell the data. You pay, one way or another.
So all the concept does is allow people to pay for services they use that someone else provides them. Think about renting a rack vs a vps, now imagine making that sort of service more granular. Things get cheaper when you do that. Things become more egalitarian, you're on equal footing online with providers. When was the last time we could say that?
And when someone tries to make a web3 version of something that doesn't require all that nonsense, people will make free alternatives. And if those alternatives serve the same needs, the ones that cost micro transactions will wither on the vine.
So the market takes care of it. Web3 will serve the roles that it serves best, and things that are better done different ways will be done differently. I'm skeptical of anyone telling me the world will run on this stuff, but to say it doesn't offer some utility, at this point you're deluding yourself. Time will tell what utility it truly provides, but one thing's for sure, this idea of a free as in beer internet isn't working out.
Not smart to compare a nft and the a link to the image the nft represents to a Rolex and a fake Rolex. That gives the ‘believers’ ammunition and it makes no sense. There is nothing fake or different about the 2 images, while fake Rolexes are fake Rolexes.
Yes, I expected him to at least point out that a real Rolex has intrinsic differences regarding its functionality as a watch in terms of precision, durability, etc. that are superior to those of a fake Rolex. Of course, we all know that the cost a Rolex is not proportional to how good a watch it is, it is a status symbol. But it is also a damn good watch.
Not the point; a digital asset is not comparable to a physical asset; the image the nft points to is the same bytes as the image he gave that image to others to prove a point. There is nothing at all fake about the second image; it is the same image. And in this case it was even the actual same link from the nft I think which is even better. There is no notion of fake in digital; you copy something and you have it, identical to the what you copied it from. This does not apply to Rolexes and calling it fake makes no sense and it’s a bad example that doesn’t educate people; people who might have ‘invested’ into nfts but don’t know any tech might think ‘but I have the real Rolex, so it does work!’. And that would be a bad and wrong interpretation of the facts.
I think you misunderstood my comment as I was emphasising your point. I was saying that a real Rolex is, as a watch, materially different from a fake Rolex regardless of how much of a real Rolex's value comes from its image and recognition. The fact that a "real" NFT is, as a URL on a blockchain, no different from a "fake" NFT was implied.
Not a fan of NFTs, but my understanding is the NFT is the signature, not the art itself. If you're just trying to make your wall pretty you don't buy signed art that costs a lot of money. If you're buying signed art, you're thinking of resale value. That's all the NFT is, is the signature.
Well, it's some type of digital proof that you 'own' the 'linked' thing. So in case you buy a NFT for a Rolex with serial number 1234, then this NFT proves you own that rolex. And then you can say, if I give you a fake Rolex with serial 1234, it is a problem. So that example would work. But most (by very far) NFT's that are 'proofs' that you own some PNG of an ape or what not and the author of the article was specifically talking about those. And there the example doesn't work; the NFT refers to an digital image, not a physical object and that image you can copy or link and so your ownership means absolutely nothing at all as there is no notion of fake. You could argue (not sure how far that would get in court) that you own the license to that image and if someone uses that image, you can go after them, but still, that's not faking anything.
> The next generation of the internet was already clearly defined - the inventor of the worldwide web had a definition for it, companies had been founded to that vision.
This doesn't seem in line with how Berners-Lee has been talking about the state of the web.
This guy has grossly misunderstood web3. It’s not just nft or for that matter only about currencies, but about designing specifically constrained computer networks , where nodes are free to behave in their own self interest, yet the network has a overall value to sustain itself. It is the intersection of game theory and distributed systems. Here is a more academic perspective on the same https://youtu.be/KNJGPI0fuFA
> Venture capitalists and entrepreneurs are betting the emerging Web3 space is the next generation of the internet
Venture capitalists that are "betting on crypto" are not, in fact, betting on crypto. They are committing securities fraud en masse.
1/ Invest in crypto startups
2/ Let them offer tokens to the public, which are, in effect, unlicensed securities (that's the fraud part)
3/ Either wait for the value of the startups to skyrocket, or, even better, obtain the crypto tokens for cheap and resell them yourself in exchange for real money
Web3 needs to detangled on beyond crypto/NFT, Crypto has very little if anything to do with web technologies like HTML/CSS/JS which are core of the current Web 2.0 era
I asked them about what appeared to me as the inherent silliness of selling an "exclusive" tokenized image, which could be easily copied with a right-click for free. Their response was that this is essentially no different from print making. When you buy a print, you are buying something you have the means to produce yourself. You aren't paying for the quality of the print making materials--you could order identical prints of the image from a print shop, or if you're less concerned with quality, simply print at home.
But when you buy a print from the artist, you're paying for that signature that says "#3 of 100." There's nothing stopping the artist from printing more, and there's nothing stopping random people from duplicating the print, but we're comfortable with the idea that a signature confers a "uniqueness" to the print that makes it valuable.
I don't know if that is an argument against print making or a case for NFTs, but I found the point interesting.
Context: I own no NFTs nor do I plan to.