Fellow humans,
People are always finding new ways to make money, especially via technology. Although I applaud and support innovation, and I hope people continue finding new ways to sell their product or service, I also hope the buyers learn to connect the dots, separating dirt from gold. Todays post is certainly biased against NFTs, so feel free to stop reading if my thoughts and opinions might hurt your ego.
Imagine walking into a crowded shopping mall, and one-thousand strangers approach you, trying to sell you their custom business card. Might be exciting and flattering at first, but eventually most shoppers will avoid these people like a plague. I’ve just loosely described the non-fungible token (NFT) market. I’m on BitClout every day, and I see posts about NFTs almost everywhere! People seem like they’re foaming at the mouth for NFTs. An NFT is basically a digital certificate, representing unique ownership of something — could be a photo, video, piece of art, whatever.
An NFT is a type of crypto asset, popularly built on the Ethereum blockchain. However, the concept of NFTs and the concept of Bitcoin are very different. A major difference between NFTs and other crypto assets is that NFTs are typically one-of-a-kind, and cannot be interchanged with other NFTs/crypto assets. For example — one bitcoin can always be interchanged with any other bitcoin, because all bitcoins are created equal, which makes bitcoin fungible. Not the case for NFTs. Being non-fungible is necessary for NFTs to represent ownership of something specific.
NFTs are in high demand right now. People have been making a lot of money by assigning an NFT to their product or service, and then selling in the market. For example — Jack Dorsey’s first Tweet was assigned to an NFT, and then sold for nearly $3 million earlier this year. Now the buyer owns a digital certificate, representing ownership of the Tweet. All proceeds were donated to people living in poverty, so I can see why certain people would enter the NFT business — to help others. However, I feel safe saying most people in the NFT business are not looking to donate their proceeds to people in need.
You might be wondering why somebody would pay millions of dollars for official ownership of any Tweet, especially because we can screenshot for free! The NFT market might end up a niche market for collectors. Imagine coin collectors, baseball card collectors, license plate collectors, and art collectors. Now imagine having a certificate to represent ownership of these items. Finally, imagine having a digital certificate of ownership. Welcome NFTs — definitely a demand, but seriously people, calm down.
The NFT market is booming right now — to the point where I feel the need to express myself. People who are not typically collectors are acting like collectors. A lot of people are excited about NFTs, and I just don’t understand the logic. It’s mostly hype, in my opinion. I believe the hype will soon fade away, and the NFT market will continue having demand, but not mainstream demand, although I could be completely wrong.
The world is always changing, but human psychology does not change as often. Most people I know do not care about being collectors, yet many people are excited about NFTs — just doesn’t make sense to me. I suppose it’s possible that most of the people involved in the hype are only trying to sell their NFTs, and are not interested in buying from others. This makes sense to me, and would create a huge supply, but very small demand, which can only end one way.
Until next time,
Salvatore Norge