It’s pretty abstract as it’s the difference between owning a digital file vs owning the tokenization of that file on the block chain.
Basically you can take a digital file and register it on an NFT exchange. This will create a “token” on the blockchain. You own that token, not necessarily the image (although there would be copyright issues if you someone else owned the commercial rights to the image). The original digital file is considered fungible in that it can be duplicated and there is no meaningful difference between your copy and my copy (assuming we both saved it as the same file type with same characteristics). The blockchain token is unique though making it non-fungible.
Theoretically it’s the difference between 2 different 1oz pieces of gold. If it’s just lump gold, there is no meaningful difference between them, both have the same value and can be used identically as currency. However, if both are turned into something by an artist then they become non-fungible. As a result their value becomes abstract and related to the perceived value beyond the inherent value its raw material had as a commodity.
The problem is in practice it doesnt actually make any sense with the current use cases. If I take a photo of my dog and turn it into an NFT. But there is nothing about that which prevents anyone else owning a digital copy of the same image. They just cannot claim to own the token on the blockchain. Wildly, you as the NFT owner dont even own the original digital image or commercial rights to it. If I take a famous photo and own the commercial rights to it I can turn it into an NFT to sell, but I keep the rights to that image. I can even make additional NFTs of it.
So where is the value in my ownership of that token? As @rab has been saying…so far there really isn’t a use case for that other than investment speculation. The current value exists solely in the expectation that NFT’s will appreciate in value (fueled almost exclusive by people being idiots with financial FOMO), and as Rab describes, there are really simple ways to game the system to present a story that your NFT has been appreciating even if its only you selling to yourself over and over.
I think this is another example where the technology is far out ahead of the uses cases for it. Blockchain as a technology has tremendous value, but the things we’ve figured out to do with it so far are really shit and mostly scammy. I think where it probably has most value is not in the NFT itself, but in using the NFT in combination with some physical product of value that might sometimes have questions about its ownership or authenticity. If a vinyard that makes an exclusive wine is the target of fakes, NFTs might be used to verify that the $1000 bottle you bought is legit and not a $15 bottle with a fake label slapped on it. The NFT’s for their own sake though, I think that really is just meme bros participating in something that is deemed cool. While people have made money by dabbling in those uses cases, that doesnt make it a viable use case or product or something a respectable company should be getting involved with (to bring it back to LFC).
It’s official. I have become my dad somewhere along the way. I asked my 15 year old son as he left the house, “Do you know what NFTs are?” and he looked at me with all the special disdain that only a 15 year old boy can muster when he thinks his dad is an idiot.
I read the posts above and don’t know what the bloody hell is going on!
*I get it better than I did, so thanks to Limiescouse, Mascot, Mattyhurst and others too, for what you wrote and links posted.
You’re a dumb old bastard @RedOverTheWater . There is no running away from it so the only option now is to double down with multiple “back in my day” takes.
I wonder if Tom and John will have any difficulty with their transport to their Wembley box. No on second thoughts, it’s only a semi so they’ll only be semi-interested. Probably have it on muted on ESPN, if there’s nothing better on Bloomberg TV.
Don’t want to brag but, no semi here. Linda’s welcome to help me take care of the gardens surrounding Alien Jo (‘Jo’ is ‘castle’). She can help me pull the weeds out.
Not sure where this goes but since a lot of our financial circlejerk happens in this thread, here it is.
I don’t know how accounting standards are applied in the UK but if say Citeh signs a multiyear sponsorship deal with another Abu Dhabi entity does that count as ‘revenue’? If yes, then any new restrictions based on revenue would be eyewash?
I think the other area that I would look at is things like the NFTs as this would allow an owner to buy a fundamentally worthless asset at overinflated prices to fund the club.
Doesn’t matter what rules UEFA come up with, clearly they don’t have the financial muscle to enforce them - case in point, Man City walking away Scott free last time because the leaked emails were from a period of more than 7 (or whatever period it was!) years old. Imagine if you could commit any crime, and as long as you keep it under wrap for 7 years, you can just do as you please.
Accountants will account the shit out of whatever rules there are and find the loopholes, and nothing will change.
