bullet points about nfts / cryptocurrencies that I can refer people to, that ends with one potentially useful application in case any boosters I know think I’m just a hater.
Environmentally-unfriendly blockchains should be illegal, even if there is a “plan” to transition them.
I do not support private currencies, though maybe some blockchain stuff will be usefully adopted by governments around the world.
Irrevocable “smart contracts” are bad. It should be possible for a judge to unwind any “contract.” Irrevocable money transfers are also bad (and I don’t think that “off chain” services where equivalents to chargebacks are possible are enough). Courts do have the power to just order someone to give people Bitcoin refunds now, but this is only enforceable by law.
“Digital scarcity” is, in general, bad. NFTs are not DRM or anything like it, it’s worth pointing out, so are not even useful for anything like “digital first sale” in practice. (Even some hypothetical future blockchain that allowed for 1 TB tokens that themselves simply were a copy of the art and not a link to it, would still not be effective for all the usual DRM reasons. There is no path to making digital media un-copyable. But I should also say that if there were, I wouldn’t want it to exist.)
“Fungible” is not as absolute a category as people think: Are dollar bills fungible? Yes. But not if you want to collect a particular serial number. Not if there is a cool doodle on one that you want to hang up. It’s a social construct as much as anything. Elementary particles however are truly fungible, so there’s that.
I am pro-cash so naturally sympathetic to the idea of digital cash. I am glad I was not an early booster of the concept however because the reality today is not worth preserving. Digital cash equivalents need to show they are useful in practice for things other than speculation, ransomware, dark web stuff, etc.
The most common type of NFT–a “unique” token that just links out somewhere–seems to be largely fraudulent. To the extent there is no fraud, no systematic risk to the economy, it’s all done on an environmentally-friendly blockchain, and probably a dozen more caveats, have at it I guess. But I would like to see them used by actual artists as something along the lines of a Patreon subscription, just a way to support an artist, not a way to get a concrete benefit. A decentralized Patreon makes sense except for the fact that in practice it would be expensive and slow and you’re probably better off just using it (or copying the business model of Patreon).
I am not even going to mention the incredibly stupid idea of game items or characters that can move from game to game. I guess I just did. It is a stupid idea that probably can’t work and even if it could, should not. Do people know what “games” are?
I am kind of sympathetic to the idea of a (subject to usual caveats) distributed database of namespaces or unique numbers. DNS comes to mind, and because I do not think it should violate trademark law (without more) to own a domain name such as microsoft.com or pepsi.com when you are not Microsoft or Pepsi, the idea that namespaces are first come first serve, and irrevocable (as a technical matter) is basically fine. But, initial allocations are a pain in the ass and I while I don’t care if Joe Blow’s website is Pepsi.com I also don’t want domain squatting and resales to exist. (Also, trademark owners would stop a truly decentralized DNS from ever coming into being.) So in practice something like this would be great if it were just something more similar to an IP address or a phone number where the goal is just to have something unique but not otherwise “special,” and maybe there could be some kind of special treatment of cool and simple numbers analogous to Cloudflare’s 22.214.171.124. I don’t think you can stop speculation and unproductive flipping but this would limit it.
NFTs as a digital proxy for ownership of a real-world scarce item seems fine. But, just as stealing a deed does not mean you own the house, it’s not at all clear that we should want some kind of “digital deed” where, whoops, you left your laptop unattended and now it’s my house. You can keep elaborating the tech to account for things like this, or instead, not bother, since all you’d be doing is replicating all the features of the system we have now, except for records being lost, which can be solved other ways.
I think using NFTs for event ticketing (please incorporate above caveats) could be a great idea actually, provided it meant that anyone could track who owns what ticket and its complete ownership history, which in addition to being useful for fighting scalpers and counterfeit tickets, would allow people to see things like when the venue itself is crooked. Venues (and Ticketmaster and some major artists) are often the worst offenders with shady ticketing practices, not the victims. For example to give the impression of a concert selling out, they will not “release” all the tickets that are available. They might then release them at a higher price later or sell them themselves on the “secondary” market. Here, smart contract stuff could do things like making some special classes of tickets (low cost ones) non-tradable. Venues don’t have any incentive to do this, and if they designed some blockchain ticketing tech themselves, it would just allow them to continue the same bullshit, so this system would have to be imposed on them by law.