NFT and the Future of Digital Content
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The forums aren't letting me quote other posts, again. Sigh.
Anyway, I was just kidding about the jealosy and don't need a badge, but it is nice that you made one.
Ok, so this is been going on for a few days now, and I am still confused.......
At 1st it all looked as this was Not For Trade. Later on it more or less became a New Found Terror. Now I get the feeling it is all just another (inter)Net Fueled Troll.
Maybe I'm getting to old for all this Non Favourable Talk......
NFTs do not use bitcoin. So framing NFTs in this energy discussion isn't a accurate representation of the energy situation with NFTs - at all.
As for the article you referred to, it clearly states that bitcoin currently uses 1/4 the power of traditional banks. To just multiply it by the number of people on earth isn't really an accurate way of computing energy use. Less bitcoins are mined over time. Also, I'm not sure that more people means more energy in the sort of 1:1 manner that you surmise. To add to the speculation, computers can run more efficiently with each successive generation of technology, there is no reason they can't make more efficient ASICs just as they make more efficient processors.
To change bitcoins or other crypto currewncy to cash, you either offer it for sale in a digital marketplace or make a direct sale to someone. There is probably a fee associated with the digital marketplace. You could also use them to pay a merchant who accepts them for a service or item. I suppose you could buy something with crypto currency, then sell it for cash.
..yeah I remember where that got us13 years ago.
...+1
Though an NFT could be used as a sort of financial instrument, technically they can represent objects, or even just an agreement between two people. Some people have put their wedding vows in an NFT, for example. There are many uses for NFTs, so it doesn't have to mean leveraged derivitives on stocks, forex, mortgages. It's really just a unique portion of code on a blockchain that may or may not execute a contract of some sort.
..it's a similar principle. and that principle back then got is into a whole lot of trouble which some are atill recovering from.
(like your art re-selling and you get 10% of the sale)
How would I know someone resold a NFT I had sold? And if so would there be yet another transfer fee I'd be required to pay in part or in full?
These problems are temporary ...
Maybe I'll look into it again once these temporary problems have been resolved, but for now I think I’ll stick to selling my silly stories on Amazon and using DAZ to make the covers. Sure Amazon gets a piece of the action, but the buyer gets an actual license/copy of the work – not just a link – and they can have it (and I can see a profit) for what they’d pay for a (really bad) cup of coffee from a big chain I won’t name. ;-)
You would know the NFT resold because money went immediately to your crypto wallet. That is the cool thing about NFTs and smart contracts in general. The percentage you get is already programmed into the NFT. So it could re-sell 100 times and you would get your 10% each time. Let's say you sell 100 cover art jpgs for equivalent of $10 each, and the NFT was programmed to give you 10% of each resale. Not including transaction fees (which are only temporarily high on ethereum-based NFTs) you made $1000. Then each one re-sells an average of 3 times over the next two years at double the original price, that's an extra $600 directly to you. You don't have to do anything, the blockchain just validates and executes those percentages when they occur and they are sent to you in minutes if not seconds.
I would give them more than a passing glance, though. You could stand to profit more and do less. It really depends on your workflow and if you feel like learning a new way of doing things. Which, admittedly can be a pain. I'm not doing much with them myself, but I see their usefulness.
It's a nihilistic art world joke. That's what I first thought, and another article spells it out that way. The reason it doesn't do anything that reasonable people might want it to do is, it's a big middle finger to people who would want it to do that. And as is well-documented, the folks in on the gag love it for being that way.
https://www.theatlantic.com/ideas/archive/2021/04/nfts-show-value-owning-unownable/618525/
Why is NFT better than other types of contracts, which aren't using blockchain technology?
None of that is fine, but it's all beyond our control. I don't like it, but that's how it is.
Thanks for the examples, it's about money, and the traders profit the most and the artists the least with zero appreciation for the artistic value or the enviroment. I get it can be tempting, but it's not the set of values I'd like to sign up to (Dang it, it's getting philosphical again).
To me it feels like a scam; I'm not saying it is, or that Daz is trying to scam us, merely my opinion of what it feels like.
It leaves the same bad taste that "Encrypted Daz Connect" did a while back.
Their introduction of Daz Central altered my buying habits in protest; I'm just dipping my toe in the water again, and this comes along.
... So: No more.
There are real opportunities offered over at the auction site, you can even buy 100 Million Acres of land on Mars for just $653.60USD. That is for sure going up in value.
Trying to argue that the power consumption of Bitcoin is in any way comparable to that of traditional banking is laughable. (I'm glad Zylox pulled up the numbers so I didn't need to.) So, Bitcoin (which affects at most 2% of the population, since that's how many people own any crypto) is 25% of the energy used by traditional banking (which is used by 100% of people). Or, according to google, 2% of the population consume 0.6% of global electricity to power Bitcoin. Furthermore, it's not as if that energy expenditure covered all the transactions of those 2%, because you can't actually buy most goods or pay bills with crypto, and the majority of those that own crypto actually just hold and don't transact. And even among those that do transact crypto, the number of transactions is probably far less than 10% of the person's total transactions. In summary, with proof of work, if the energy expenditure scaled linearly, then we'd easily exceed the entire world's energy capacity if every transaction used crypto, even at current power levels. And linear scaling is not an unreasonable assumption because, if Bitcoin handled all trade, its market cap would need to be proportionate to the world's GDP/wealth, which means mining would become more profitable, which means more people would mine, which means more energy spent. Linear scaling actually makes a lot of sense.
Now, let's address the (ridiculous) whataboutist claim often made by crypto proponents of "why is the energy used for crypto bad, while [insert any use of a GPU] is considered okay?" I think most people would agree that energy use that creates something or furthers humanity is not a waste, whereas energy that produces nothing is a waste. GPU use, whether for gaming, rendering, or research, all serve a practical purpose: productivity or entertainment. Entertainment is a means of relaxation, which is necessary for people to be productive, so that energy ultimately ends up fueling productivity. Running a while(random() != magicNumber) { /*do nothing*/ } loop in code is the definition of wasted energy, which is exactly what cryptomining is.
Now, you say that NFTs run on Etherium, so we shouldn't compare to Bitcoin. But they're both cryptocurrencies, and they roughly accomplish the same purpose. Hence, promoting one cryptocurrency means collectively promoting them all, and promoting their general acceptance/adoption. This is evidenced by their correlated price trends. If Bitcoin all of a sudden vanished one day, or waned in popularity to Etherium, you can be sure that those who are mining Bitcoin will just swap to Etherium (even if it means they need to buy new hardware), meaning the power consumption of Etherium will skyrocket to the levels that Bitcoin has now.
You say that "there is no reason they can't make more efficient ASICs" for mining in the future. Well, it sounds like you don't even understand how cryptomining works. The mining difficulty scales with computing power in the network, in order to ensure a consistent time between blocks. So if hardware becomes more efficient, then the difficulty will simply increase, and a miner will have twice the amount of computing power (to waste) at the same power expenditure. The limiting factor is always energy cost/capacity and hardware availability, the actual hardware efficiency is irrelevant (except for the miner's personal profits if they have more computing power for the same amount of energy). And as the last 20 years of computer hardware have shown, future generations of hardware prioritize increased performance instead of decreased power consumption.
Finally, let's address the idea of how amazing NFTs are, and how much value they could provide the world as a practical means of authenticating ownership, without a middleman. The fundamental flaw here is the assumption that humans are honest and lack greed (greed, i.e. the very foundation on which NFTs are built on). Due to the anonymous/irreversible nature of crypto transactions, it's easy to scam buyers or sellers, so NFTs can only ever work as a means of selling/trading worthless items (or representations of items) in order to have the honor of holding the title of "owner."
For example, take Daz selling assets via NFT. Nothing stops me from buying the NFT, downloading the asset, and reselling the NFT to someone else, even at the same price. That person can then download the asset, and resell to someone else, and continue the cycle, essentially each person in the chain getting free content, and ripping off Daz, or whoever the seller might have been. Alternatively (or if there's one of those pesky "smart contracts" involved), I can just create an account and sell the asset as if I were the owner. Or if I really wanted, I could create an account and actually just sell nothing: a 404 error.
But how about buying something non-digital, like real property, i.e. something that can't be reproduced? Okay, let's say the title to my home is tied to an NFT. What if a guest hops onto my computer while I'm not looking, and sells the NFT to someone without my permission? Or maybe it happens due to a computer virus. Does that mean I've lost my home? Or was it the buyer that got scammed? Or what if I'm renting out my apartment, and the renter pretends to be the owner, mints a new NFT, and sells the apartment. You can argue that in all these cases, the buyer is responsible for verifying that the seller is an honest person. Well, perhaps for the safety of everyone, there can be an established/trusted account, such as a realtor, and I as the owner can transfer my NFT to them, so that the buyer recognizes the trusted realtor account and knows they're not getting scammed. Okay, so in an effort to save the buyer the time and effort to do their due diligence, and as a means to establish trust for all parties, I've just reintroduced that evil middleman. So in essence, that terrible system that we have now, of laws and middlemen, actually exists in order to solve all the problems plaguing NFTs. Wow, mind blown! Who knew that dishonest people exist!
All that said, I'll be happy to change my perspective on Etherium when it changes to proof of stake, but I'll believe it when I see it. Until then, it's cancer. And regarding NFTs, I'm not opposed to NFTs running on an energy efficient blockchain if they're used to distribute meaningless titles of no real world value outside of being collectible, perhaps with some trivial artwork/asset attached to symbolize the token. But to make the claim that they're useful in any real-world/practical way is, frankly, delusional.
You're right, to just compare Bitcoin and traditional banking use by a number of "per customer" doesn't tell the story. Instead look at the transactions. Bitcoin can handle a maximum of 7 transactions per second (in reality it's more like 4 to 5 transactions per second) with a wait time of 10-20+ minutes (up to "it depends" minutes) to get a "confirmation." Traditional banking handles hundreds of thousands of transactions per second with near-instant confirmations. And yes, more powerful, power efficient hardware comes with each generation, which traditional banking will also invest it because it will also increase their transactions, while decreasing their operating costs. Meanwhile Bitcoin will continually become less efficient by design to make mining more coins harder. Bitcoin couldn't keep up with one busy retailer's transactions, yet uses the same amount of energy as a developed country.
Besides the energy consumption aspect, these blockchain currencies and items can be stolen or double-spent by a 51% attack https://www.investopedia.com/terms/1/51-attack.asp You might think getting that much compute in one actor's hands is a challenge but it becomes more possible when paired with something like a BGP hijack attack https://en.wikipedia.org/wiki/BGP_hijacking to knock other nodes off the network and increase their compute %.
Not including transaction fees
Yeah, right now this is geared to making the bank (or whatever you want to call it) plenty of money - a lot like those stock houses that make money on every bid to buy/sell of stock.
It really depends on your workflow
No. It seems to depend more on you throwing money away and praying someone else will pay even more to bail you out.
You could stand to profit
There's that 'could' in there that's the problem. You 'could' also lose every penny you put into it if you can't find any suckers. Where as when selling my ebooks on Amazon I put it up and get 70% of what each one sells for - if they don't sell I'm out nothing more than a little of my time. With this NFT thing I'm out the cost of each NFT I offer - and if they don't sell or don't sell for enough I don't make it back.
NFT as it is is a bad bet for anyone but the bankers. Let me know when(if) the 'bank fees' get under the price of a cup of coffee.
Yup you just feel some better fore thought and discretionary decisions could have been made.
And the seller can produce a legally binding title to that Martian land and a chain of custody for all that legal paperwork that proves it?
All I've got to see is being in tech doesn't elimate that the products are bad products or scam products or even worth investigating, except maybe police investigations.
Edited to note, this is more about previous comments from maybe a page ago... I had to wait to post this because of a DAZ server based Cloudflare issue and I forgot about it for a while...
Egh... every time someone says "NFTs are not like Bitcoin" or whatever other cryptocraptocurrency they may be responding to or defending, in response to the issues with the massive power consumption required by cryptocurrencies and NFTs, l'm forced to wonder if they understand the concept at all...
Almost all Cryptocurrencies require some form of Proof of Work (PoW) or (Proof of Stake) to be added to the blockchain, the PoW is what gobbles up all the power and is environmentally unfriendly.
While Proof of Stake, the system Ethereum says it will "soon" adopt is supposed to be "greener" and require less energy, all I see is claims about it being greener, but no hard numbers... 10%? 82%? I'm sure it's less wasteful, but how much less?... Only one site I visited gave a number based on a claim by Ethereum that it was going to reduce its energy use by 99%, but they were promoting Ethereum and really talked around the details in such I way that I have zero confidence in that percentage.
Every other site talked around the issue as well, with the amount being "huge", "substantial", "eco-friendly" and "game changing"...
Either way, at the moment, all the major cryptocurrencies use PoW, so what happens two months or two decades from now is not relevant to "is now" the context/tense to which the argument is being made.
"But... see, they are different than NFTs!"
No.
NFTs need to be "minted" to be added to the blockchain (actually, more correctly, the artwork or whatever needs to be minted to become an NFT)... minting requires PoW... and Proof of Work requires all that delicious energy.
Typically unless you are going to do the work/minting yourself, you need to have your work minted for you by a service... and that has a cost... a "gas fee" (a reference to the energy requirements of minting)... typically, at the moment, it's $70 - $100 gas fee per transaction... plus you need to find the right platform, create a wallet, purchase cryptocoins to pay the fees, choose a starting price and or what your royalties will be and then figure out how you are going to promote your work, presumably through social media or driving through the streets shouting about it on a bullhorn*... then you sit back and wait for the bidding wars to rage.
So, even if you ignore that minting is costly energy-wise, you still need the damn cryptocash to pay for the minting and almost all cryptocurrencies are huge, substantial, non-ecofriendly, game changingly stupid energy wasters.
So maybe you mint the work yourself and mine your own coins and you have your own solar farm, windmill or hydroelectric dam in your backyard to keep your energy use clean, green and off the grid.
Okay... good work... you win...
Otherwise...
No.
An interesting example of how even trying to be green with NFTs is kinda useless, is well illustrated by British artist Jeremy Deller's work "The Last Day", which was auctioned off for charity (or will be... I'm not clear on that part yet)... the work was for charity, but also kind of a way for him to see what was involved in the NFT process...
He chose the Open Sea platform because it uses the "lazy minting"** principle which did not require any gas... However, once the work is sold, the transfer to its new owner will require 48.14 Kilowatt hours of processing energy on the Ethereum platform. That's roughly the equivalent of 1.63 days of power consumption for your average American household.
*Presumably on a bike because that's more eco-friendly than your coal powered Hummer.
** Lazy minting sounds cool, because you don't pay the gas fee up front... but you do pay it (or the buyer pays it) when the work is sold because the work isn't minted until that point... how that actually plays out is kinda cloudy too, as how that system actually works seems to be a little murky and the platform seems to getting swamped because of misunderstandings as to who is paying the gas fee, how much is it and if you have to except certain offers.