The NFT Bubble Might Be Bursting Already (cnn.com) 109
An anonymous reader quotes a report from CNN: Prices of NFTs, the digital certificates that have taken the art and collectibles world by storm this year, have plunged about 70% from their high point in February. The average price for an NFT on April 5 was about $1,256 -- down from more than $4.000 in late February, according to market research site NonFungible.com. Data from The Block, another crypto research firm, shows a similarly large decline for both prices and NFT sales as well.
[T]he sharp, sudden rise in the value of NFTs and more recent pullback is reminding some of other similar historic market bubbles, such as tulip mania in the 1600s, the dot com/tech crash of 2000 and bank stocks and housing prices in 2008. NFTs may be here to stay, but they just may not be worth the staggering sums of money that some people have shelled out for them in the past few weeks.
[T]he sharp, sudden rise in the value of NFTs and more recent pullback is reminding some of other similar historic market bubbles, such as tulip mania in the 1600s, the dot com/tech crash of 2000 and bank stocks and housing prices in 2008. NFTs may be here to stay, but they just may not be worth the staggering sums of money that some people have shelled out for them in the past few weeks.
Broken links (Score:5, Interesting)
All you have to do is go to Wikipedia to find how frequently source links are broken. Things move around on the internet all the time. So essentially when you buy an NFT, you're buying a URL, with no guarantee the URL will continue to point to anything next year. Buyer beware!
Re:Broken links (Score:5, Informative)
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I thought the NFT was on a blockchain though. If you have a blockchain explorer for Ethereum, which I think is the crypto where most of them live, you still have the NFT, right?
Re:Broken links (Score:5, Informative)
The problem is the blockchain can't store large files cheaply. It costs 20000 'gas' to store 32 bytes of data on the block chain and 1 'gas' costs a medium of 114 'gwei', and 1 'gwei' is 1E-9 Eth so 32 bytes costs 4.845 USD as of right now and this message as of the end of this sentence would cost about $45.
Since that's clearly not economically viable in anything but small images or SVG files, a URL is used instead since you could 'mint' a URL from as little as 1 block.
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Ah, OK. That makes sense. I think that's how those "crypto punks" work. They store a reasonable number of bits on the chain, and each bit represents a characteristic of the "punk" which is rendered out by a 3rd party site someplace. Crypto Kitties works the same way I think, with the addition of being able to "breed" them and create new bit strings on the chain. Then once again, the "cat" is rendered by a 3rd party site.
So. If you own a virtual punk or cat, at least it won't go away as long as the cha
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Yes, depending on the encoding system, you could employ some form of delta encoding system to dramatically reduce the payload requirements for derivative works. Oddly this actually makes some works more exclusive since if the price continues to increase, creation of novel objects on the blockchain will become prohibitively expensive over time. So long run, Ethereum based NFTs will consist of various Crypo Kitties and dead URLs.
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The NFT just says you're the owner of what that points too. Wait a minute... maybe I can use this to charge other people for looking at 404 error messages...
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The NFT just says you're the owner of what that points too. Wait a minute... maybe I can use this to charge other people for looking at 404 error messages...
You're the owner, but you don't have any rights over the thing you own?
So you're not the owner. You're a fool.
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So you're not the owner. You're a fool.
I mean that could be said about basically anything a hyperrich person buys.
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So you're not the owner. You're a fool.
I mean that could be said about basically anything a hyperrich person buys.
Hyper-rich fool is actually on a spectrum that spans $500,000 sports car to $500,000 url shortener record. Maybe it's all the same to someone that doesn't have $500g to blow, but I can't imagine it's the same thing to someone that does.
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That is correct, you are not the owner of the "thing" your NFT points to. You are only the "owner" of the pointer to the thing. Everybody else can access the "thing" just as easily as you can.
I suppose it's like "owning" a particular QR code.
A fool and his money are soon parted.
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This whole thing makes Dogecoin sound like a sound investment.
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The person is buying a URL. Just a URL and nothing else. A URL is just the address of a web page. A URL is just a string of characters. Not the servers behind it, not the data it points to, not even the domain name.
It is like you bought the address of a person. If the person moves or dies, that address is worthless.
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It seems like storing a SHA-3 hash (or stronger) and perhaps another recognized hash from an independent "hash family" with a nanosecond UTC timestamp appended instead of a URL would make more sense.
Sure, there is the possibility that the hash (or both hashes) are "broken" because the algorithms turn out not to be as strong as thought or because of computing power increases. But that risk doesn't seem to be as great as losing a physical item due to fire or other natural disaster - eventually everything turn
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The lameness filter shoots down lines of C code, or random combinations of white space as ascii art, but gigantic ascii art swastikas with swastika in the title pass. Come on Slashdot...
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I don't understand NFTs (Score:5, Insightful)
Aren't they just a certificate of authenticity, at most?
When you're trading valuable items that can be replicated, a certificate of authenticity is necessary of course, but you're trading those items, not the certificate itself.
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Aren't they just a certificate of authenticity, at most?
In implementations like NBA Top Shots they can also be loot boxes.
Yay.
NFTs are performance art for blockchain (Score:2)
Re:I don't understand NFTs (Score:4, Insightful)
The scam is that you can sell things that aren't yours. The NFT is like a fake certificate of ownership.
It's basically the old "I have a bridge to sell you" scam for 2021.
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That's actually how I explain NFTs to people.
Even if the "URL" is something that is never broken (using a hash on IPFS for example), the issuing business is not an authority. There is nothing to stop another company minting their own NFT for Beeple's picture and then selling that. Or a third company doing the same. And so on.
There are so many flaws in this system even from just a layperson's PoV.
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My comparison was Alice buying a star's name for $50 from the Astrological Society.
Then Bob bought the name of the same star, paying $50 to the Astronomer's Archive.
Imaginary Property is a racket, and this is no better.
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John Cleese of Monty Python fame did just that. I think there was a /. story about it a few weeks ago
Well crap. Wonder what I could get for the Staten Island ferry.
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I still do not understand this (Score:4, Insightful)
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Why do diamonds, gold, or old stamps have value? The {idea|scam} of NFTs is to create essentially a collectible which acts as a store of value. The reality is yet to be determined.
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The reason stamps go up in value is because so many people collect them that there is competition for specific stamps.
Yep, and the reason people collect stamps is because its history. Some people collect old computer hardware. Some people collect old tools that arent really fit for purpose any longer. Some people collect old firearms.
I'll bet you anything that the dipshit that you are replying to collects pirated movies.
Some people collect old software. Some people collect old perfume bottles. Some people collect old zippo lighters. Some people collect signatures. Some people collect old coins. Some people only collec
Re:I still do not understand this (Score:4, Insightful)
People collect all kinds of dumb shit not thinking they'll ever make money. The reason stamps go up in value is because so many people collect them that there is competition for specific stamps. The history associated with stamps and coins baseball cards and comics and shit like that attract people. I don't think there's a single human on the face of the Earth that actually believes an NFT will appeal to anyone for any reason other than a speculative investment. Am I wrong?
All of those physical objects are actual things you can take and put somewhere. An NFT is none of that.
It's like owning the bookmark in your specific browser and nothing else. Not the web site, not the image file. Nothing.
It's like having exclusive ownership of nothing at all.
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Gold is beautiful to look at making it good for decoration and is also a good conductor.
Old stamps again have visual and historical appeal and were used as postage at one time.
NTFs are none of those. They are just an URL, An address to something that may not be there in 10 minutes.
NFTs is to create essentially a collectible which acts as a store of value.
An NFT is nothing but an address to something that may not be there in the future and it has zero value.
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And do you know what women don't give a flying fuck about? Crypto and NFT's
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I still do not understand why anyone believes that NFTs have any real value at all.
The same reason why some people buy pieces of land on the moon, or rather, pieces of paper claiming ownership to some land on the moon -- there is a sxxker born every minute.
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They have some value but the problem is that everyone is using them for the wrong crap. They're a great way to store records of something that you might want to be able to transfer at a later date.
Take San Diego Comicon for instance. Their current system for buying tickets is set up so that people that got a ticket in the previous year have dibs on the tickets for the following year. Without jumping through a lot of hoops, this benefit can't be passed on to anyone else, you can't sell it for anything. If th
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Take San Diego Comicon for instance. Their current system for buying tickets is set up so that people that got a ticket in the previous year have dibs on the tickets for the following year. Without jumping through a lot of hoops, this benefit can't be passed on to anyone else, you can't sell it for anything. If this benefit of "first dibs" were converted into an NFT, then you could pass/sell that NFT around if you have no use for it next year.
Another example would be something like attending artist concerts or sporting events. Every event you attend you get an NFT, kind of like a "frequent buyer reward card" at shops. Event organizers could then grant different bonuses depending on how many of these "event NFTs" you have built up. This also lets someone sell them off to other people.
You keep on talking about allowing people to sell off a benefit provided by to them by a third party. What makes you think the third party wants that? SDCC doesn't want people to do it just like they don't want attendees to sell their tickets.
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It was just an example of a using NFTs to transfer an intangible. I agree SDCC probably does not want that right to be transferable but there are all kinds of other property rights and agreements that we probably do wish to be transferable.
An obvious one is Options contracts. Those would be a good candidate. One party might originate a contract that says the counter party has the right to buy at X (a CALL) the counter party can sell that right to someone else, right now that is handled by a complex system o
Re: I still do not understand this (Score:2)
"Another example would be something like attending artist concerts or sporting events."
We call those tshirts and posters.
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I still do not understand why anyone believes that NFTs have any real value at all.
Define "real value". Value in general is nothing more than the amount someone thinks something is worth. That bag of coffee, it has value. That cool little drone I built as a hobby and someone paid me $200 for, that has value. That gift I got from my grandma before she passed that absolutely no one else would want, that also has value, it's actually more valuable than a lot of expensive things I own.
The only way art has real value is due to fragility and scarcity
Art is neither frail nor scarce, you can find it anywhere. If you're talking about that one specific piece of
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That gift I got from my grandma before she passed that absolutely no one else would want, that also has value, it's actually more valuable than a lot of expensive things I own.
But only to you and perhaps some family member of yours you can convince its significant. IE your great great grandfather was fighter pilot in WWI, this is the tool kit from his plane. My father used to work on his cars, I do too, someday you will.... To anyone else they a battered set of mostly nondescript wrenches, oilers, feeler-gauges, and spade screw drivers in a well made but similarly beat up wood box. Not really of historic interest because without the story behind them and the personal connection t
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Because people are idiots.
An NFT has a real world equivalent - you may have heard of "Certificate of Authenticity" or CoA. You know, anything you buy a collectible, it often comes with such a certificate that say
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An NFT has a real world equivalent - you may have heard of "Certificate of Authenticity" or CoA.
NFTs wish they were CoAs. An NFT is literally just an address of where something is when the NFT was created. And, the NFT can't be changed if the thing moves or is destroyed.
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I'm not surprised the average price is down (Score:4, Insightful)
Multiple podcasts and youtubers have been selling them for very low. I'd be more interested in the total amount spent each month.
That 1 69 million dollar sale drives up the average massively even.
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Re: I'm not surprised the average price is down (Score:2)
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junkyard (Score:2)
There is someone that wants to be owner of the junkyard. When its all worthless they'll work on obtaining the entire blockchain.
Drat and bother. (Score:5, Funny)
I had just secured the NFT to the Brooklyn bridge - and was assured it could only go up in value.
Now I'm off to found a new company - LegitInternetDibs - want to be sure, put a LID on it! I call dibs!
Ryan Fenton
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i will trade it for some ALF pogs.
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Should be more funny on this funny money topic.
I did check all the references to speculators and didn't laugh. I'm pert' shure this entire NFT thing was supposed to be a way to create value for Bitcoin, but that bubble is also overdue for a burst.
(Which ties back to the story of the Chinese cryptocurrency, which is one of the threats that can kill Bitcoin. Also pert' shure the Chinese government doesn't see any reason to waste all that electricity just for a fancy fake-scarcity clock for signed blocks.)
It'll go back up (Score:5, Insightful)
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Pretty much this; buy something worthless as a collectible for payment for something, and any value that remains is just a bonus.
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I mean, I doubt money laundering for weed is driving this. If anything, my guess would be citizens of China trying to hide assets from the state are the biggest driving force.
Oh well, maybe it'll get them to stop buying and leaving vacant buildings throughout the US.
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it's a money laundering vehicle.
The non-fungible nature of NFT makes them unsuitable for money laundering.
In money laundering, the goal is to obscure the source of the money. Using non-fungible tokens means the source of money can be traced back to it's source via the token chain because each token is unique.
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That just means that the population of people willing to throw good money at a collection of electrons hasn't yet been exhausted.
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Yep, you've convinced me with your stunningly well documented analysis. I'll just have to cash out my collection of Beanie Babies and sell my collectible edition Furbies and Cabbage Patch Kids and invest tomorrow!
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If the Fed ever cracks down on money laundering you'll see a spate of suspicious "suicides" among its leadership and the whole thing will quietly go away. The US banking system launders over a trillion (yes, with a "T") of dollars a year (we're the world's biggest money laundry). They pull in 10-15% in fees for that service, so that's $100-$150 **billion** in fees annually. It's so lucrative that Treasury Secretaries retire from "public service" to go run money laundering operations for CitiCorp and Morg
Artificial scarcity (Score:4, Insightful)
Re: Artificial scarcity (Score:2)
The irony is that they still can be copied and viewed. Someone paid millions for dorseyâ(TM)s original tweet, but itâ(TM)s still on Twitter and anyone can see it. The buyer got nothing.
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They still can be copied exactly with virtually zero cost. But the entry on the blockchain is as inviolate as such things usually are. What's special isn't actually the data. It's being stored in an actively maintained blockchain.
If the blockchain in question goes tits up then your NFT is no longer provably existent and its value drops to zero.
Re: Artificial scarcity (Score:2)
It's like paying for beanie babies (Score:4, Insightful)
With tulips. :: shakes head :: Not my money, not my problem.
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With tulips. :: shakes head :: Not my money, not my problem.
Unfortunately, as we have seen in 2008 already, if the bubble grown big enough, it will become everyone's problem when it bursts.
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At least tulips are pretty and squirrels think they taste good. The "beans" in beanie babies aren't even eatable.
Only the performance art pieces will hold value (Score:2)
The ones which grabbed headlines early on and from big troll artists for which the NFT could be said to be part of a performance will hold some value.
For those the traditional art collectors will provide a true collector's market. There was never an underlying collector's market for all the other ones, it was all speculators ... and speculators can't sustain a collectable's market indefinitely.
Congratulations to all of you who cashed in early (Score:2)
Bubbles are super profitable... if you can get out in time.
bubble ? (Score:2)
Do we really call this a "bubble" as if it were an actual investment thing?
Or shouldn't we better call it a short-lived scam because that's what it is, isn't it? You pay a lot of mony for a signed copy of a link to something that you anyway don't buy any actual, legally enforceable rights to.
I mean, it's the cryptocurrency version of selling a photo of your iPhone on ebay with a misleading but strictly speaking truthful description that makes people think they buy the actual phone.
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NFTs can come with ownership of an actual physical object.
I suggest that the most probable eventual official use for NFTs is that every object will eventually (who knows how many decades from now) have an associated NFT, and transfer of ownership of the NFT implies transfer of ownership of the object. The NFT will be used to determine who actually owns something. If someone steals something from you, you'll be able to prove it's yours because you hold the NFT.
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But then we're talking about something entirely different.
In fact, blockchains are currently in (experimental) use for such purposes, e.g. land registers which in many countries are open books anyway and you want the full history and all, e.g. one of the actually fitting use cases for a blockchain.
VNFT (Score:2)
Plenty of other bubbles in the sea! (Score:2)
I've already moved on (Score:2)
Forget NFT's. The future is the Totally Fungible Token!
https://thedailywtf.com/articles/announcing-the-launch-of-tfts [thedailywtf.com]
Not surprising (Score:2)
Ponzin scheme (Score:1)
I feel no regret for that idiot that shelled out a couple of million for an URL to a blockchain somewhere. The faster we get this meltdown over with the better. Otherwise more stupid people are going to lose their money.
bubble burst? you bet! (Score:1)
NFTs released today will be price equivalent to pogs. but that doesn't mean they couldn't be useful. tokens need an ecosystem to keep them alive, relevant, and worth the cost of electricity. an obvious application would be exchangeable items in an online universe. other, less glamorous uses could be for licensing digital assets, escrow, the sky is the limit. but to be sure, today's mania is going to cost some folks money.
it didnt really bubble (Score:1)
it was sold as "the way to indie your art"
and then it turned into wallstreet - things went down but meeplez is a happy now lol
its not over , there's alternatives coming on non-ETH chains (i tihnk at least one on polkadot which is a rising star the level of chainlink)
o yea, HIPPIES : BUY CARDANO , ITS GREEN! (pardon the caps, i have absolutely no vested intrest there)
NFT spam (Score:2)