NFTs: A Waste of Money or the Future of Art?

Originally published at: NFTs: A Waste of Money or the Future of Art? - TidBITS

Artists are making big money by selling on the blockchain, with some hipsters and hypesters claiming it’s the future of digital art.

I’ve read through that Verge article twice now, and all I’m seeing from this is that a new class of middlemen are claiming that they can make artists rich. I have a bad feeling that it’ll end up with the middlemen rich and everyone else fleeced. With the added kicker of helping wreck the environment in the process. Cynical? Maybe.

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Regardless of the short-term value of NFTs for artists, they are currently unethical given how energy-intensive transactions on the blockchain are. The energy required for the transactions involved with minting and selling a single NFT are roughly equivalent to a year’s worth of electricity usage for the average EU citizen, and artists tend to mint at least dozens of NFTs per run.

I totally understand the desire for artists to monetize their work given how little our society values art, but NFTs can’t be the approach if we still want a habitable climate.

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Beanie Babies. Tickle Me Elmo. Uggs. Lava Lamps. Pokémon, Cabbage Patch. Jordasch. Etc., Etc., Etc…

Memoirs Of Extraordinary Popular Delusions And The Madness Of Crowds, first published in 1841, is available for free in Apple Books. It’s 100% true history, and great fun to read.

Another article attempting to explain NFTs…

Good explanation. And proves that it is a waste of money.

It’s just like trading Beanie Babies. Only when this bubble bursts, you won’t even have a room full of plush figurines to play with. You’ll just have “bragging rights” to tell someone you paid thousands of dollars to have your name associated with a URL somewhere.

And musicians are starting to sell albums, seats for concerts and promotional products via NFTs:

And if you have $2,500,000 sitting around, Jack Dorsey is selling the very first tweet:

Seth Godin is very much not a fan.

Everything is a “waste of money” if you don’t want to buy it. For me, Spotsball tickets are a waste of money, but many people disagree.

The NFT has one advantage over every other method of artists getting paid: with an NFT the artist makes money every single time the work is sold. Not a lot, but if the work becomes valuable they do not get only that initial $75 for designing the Nike logo, but also a percentage of the sales price going forward.

Oh, and minting an NFT is not like mining bitcoin. It does not require gigawatts of power and hundreds of GPUs.

There’s a huge difference here.

If I buy a ticket to a “sportsball” game, I get to go and see the game in person. Someone without a ticket can’t (legally) do so. He might be able to watch it on TV or see highlights in the news, but he, by definition, can not have the full experience of seeing the game in person. That is a very distinct value.

On the other hand, buying a token that says you “own” a video clip or an animated icon that everybody on the Internet can also download doesn’t give you any special value. The only thing you have that nobody else has is your name on some web server somewhere saying that you paid for it.

People like to compare this to buying a precious work of art, but the difference is that if you own a painting, you can take it home, hang it up in your living room and enjoy it, and nobody else can do so without your permission. Ditto for any other physical collectible item. Part of the value is that you have exclusive rights to do what you want to the item.

But if I pay a sum of money for something and everybody else in the world can still get it with or without my approval, then what have I paid for? Nothing more than the publicity of other people seeing my name on the thing’s official home page. Is that worth something? Maybe. Is it going to be worth anything in the future? Ask all the people who spent thousands of dollars collecting Beanie Babies what their collection is worth today.

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I’ve never been to Paris, but I have seen the Mona Lisa many times. ¯_(ツ)_/¯

No one paid millions of dollars for a Van Gogh to keep it from being seen by anyone else.

Except that there’s a material difference to seeing the original as compared to a reproduction. It might not be a difference that matters to you, but there is a physical difference in the materials and their properties that can change the experience of looking at the Mona Lisa. A copy of a piece of digital artwork is literally exactly the same.

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Maybe not the Mona Lisa, but I’ve paid for dozens of (far less expensive and not the least bit famous) pieces of artwork. They are hanging in my home and nobody can see them without visiting my home and getting my permission to enter.

And all those famous works are owned by someone, whether it is an individual, a philanthropic foundation, a government, corporation or any other organization. The owner chooses whether or not it should be displayed, where it should be displayed, who gets to view it, and how much you must pay for permission to view it.

And if you want a copy for yourself, the owner typically holds a copyright, meaning he has to grant permission for you to (legally) make or buy a copy.

None of this applies to NFTs, where anybody can go and download a copy that is completely identical to what the “owner” paid for. In the case of the NBA video, the buyer doesn’t even have a copyright license, so he can still be sued if he decides to redistribute the clip that he paid hundreds of thousands of dollars to “own”.

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There’s also the issue of reproduction rights. The sale of a work of art might or might not include reproduction rights. IIRC, unless a deal is negotiated with the artist, the artist maintains reproduction rights for the painting, sculpture, print, etc., unless it’s a work for hire, licensing or another negotiated arrangement. Andy Warhol, who had a background in commercial illustration before morphing into fine arts, made sure he held on to reproduction rights. He did very well with T shirts, etc., from work that he sold to someone else or gave to a museum, and I’m sure his estate still earns money from licensing.

I don’t know how this will play out with NFTs, but I’m assuming it will be the same. I suspect a lot of people are clunking down big bucks for NFT ownership without knowing they might not have IP rights.

Here’s one recent example:

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Yep, there are whole temperature controlled warehouses full of physical artwork across the globe.

Often owners never even see the work, but buy it then hold it for a period as an asset then eventually get it pulled out and up for sale when market conditions are favourable to garner a decent return.

Try doing that with a Tweet in the future. I think not. :roll_eyes:

And there have been issues with stolen artwork throughout history. Here’s just one recent example:

Pretty unbelievable how such legacy issues remain decades later.

The surface is still just being scratched. A many decades long struggle over Kilmt’s Lady In Gold was settled just a few years ago by the US Supreme Court. There’s a fascinating book about about it “ The Lady in Gold: The Extraordinary Tale of Gustav Klimt’s Masterpiece, Portrait of Adele Bloch-Bauer.” It was made into an award winning movie starring Helen Mirren. A good summary of the case is here:

Oh yeah, I remember that. AFAIR, the BBC I think did an arts programme about it. :wink: