Just crawled out from under a rock... What are NFT's?
Brycescaper
Posts: 148
This topic category is new since I last visited the Forum to ask a question... I gather from some of the thread titles that it is some form of commercial platform to sell your renders, perhaps a new format, but maybe not. I've been so busy having fun with the Face Transfer plug-in with no problems I haven't run into anyStudio issues lately. Anyway, I am intrigued. Could someone provide a basic three-to-six paragraph summary of how they work and their benefits? Thank you!
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NFT stands for "non-fungible token". 'fungibility' is the property of being substitutable so, for instance, a dollar bill is fungible because it can be replaced by any other dollar bill; something that's non-fungible is unique.
An NFT is a unique token representing some object that you own. NFTs are linked to cryptocurrencies like Bitcoin in that they use the same technologies as cryptocurrency to create a unique, permanent record of ownership. They're also usually bought and sold using cryptocurrency.
The object owned could be anything: you could, in theory, have an NFT representing your ownership of your house or your car, or your ownership of a patent or some other valuable but intangible object. In practice, most NFTs are associated with insubstantial objects such as pieces of digital art (and this is where DAZ comes in). If you buy an NFT on a piece of digital art, a permanent record is created saying "Brycescaper is the owner of this piece of art." So, for instance, DAZ has been offering people the chance to buy NFTs linked to pieces from collections of themed 'artworks' such as their Fight Back Apes or Non-Fungible People collections. It's rather as if you bought a limited edition print from a traditional artist, except that there's no physical piece of art that you can hang on your wall (although of course you're free to print out the JPEG of the thing you 'own', frame it and hang it on your wall).
A lot of people buy NFTs much as they buy art, for the purposes of speculation. The idea is that they can later resell this unique 'thing' to someone else for more than they paid for it. Because it is unique (in loosely the same way that an original painting is unique), it's rare, and its value might increase.
Now ... that's the theory. I should point out that many people are very sceptical about NFTs. It's unclear what exactly you own. At the end of the day, often all you get for your money is the right to say "I own that insubstantial thing." You have to decide if that's worth anything to you. You also have to decide if it's a good investment. The initial flurry of enthusiasm for NFTs has mostly died away (NFT trading volumes are down about 97% since the start of the year), and a lot of people are now left having paid a lot of money for something that no one wants to buy from them. And NFTs and cryptocurrency generally have been plagued by scams, hacks, and dubious financial shenanigans like "wash trading" (where people sell something to themselves to increase its value).
The NFT is just a link to some digital content residing on a server somewhere. On it's own, the NFT is just a proof of ownership of that NFT, ie. the link that can go dead just like any other link.
Without additional measures, owning the NFT is no proof of having any rights to the content behind the link, as the creation of the NFT requires no proof of ownership or originality of the content.
I crawled out from under that same big rock back in December ... ... ... consider it stepping out of reality and into virtual reality ... it is hard to believe how different it is.
You must deal with the entire realm of cryptocurrency (online virtual money) and blockchain purchases (highly complex trains of information across multiple servers that record your purchase or sale) as well as the speculative market (like stock market) of NFT's (made up mostly of digital artwork).
In the end, if you have an electrical outage (or worse like eventually a nuclaer war or a powerful solar flare or anything that can wipe out multiple server locations at once) you (and/or vast numbers of people) can lose the whole thing.
Like any investment: some will get rich, many will lose money, and most will be left out altogether. It has already had a few boom and bust cycles ... more may follow.
I tested the waters ... they are too rough for me ... I will be staying out.
EDIT: Oh, and Daz Studio, with parent company Tafi, are in the thick of it trying to make a collection that becomes valuable ... we will see if they are successful.
Nope. If you buy an NFT on a piece of digital art, a permanent record is created saying "Brycescaper is the owner of this link to that piece of art." The ownership of the actual piece of art that is linked is not affected by it.
An NFT is a technically complex way of creating a digital thingy that only one person can have at a time. Unfortunately, that's about all there is to it. These thingies don't actually mean much of anything. Some people like to talk big about their potential, but so far, they seem to be a solution in search of a problem. There's nothing they can do that can't already be done much more easily by other means.
The precise meaning of an NFT and what it conveys in terms of ownership seems to vary from NFT to NFT. In some cases, there's an implicit or explicit idea of 'ownership' of the thing identified by the NFT. In others, not so much. In some cases, purchasing the NFT even conveys additional rights (for example, the exclusive right to use the associated art as an avatar on particular platforms), or even access and exclusive rights to use some other thing, such as the unique 3D model files made available to buyers of DAZ's Non-Fungible People.
Of course, it's very unclear what mechanisms exist to enforce any grant of exclusivity. I don't know if there've been any cases where an NFT owner has successfully sued someone for using a piece of content to which they theoretically have an exclusive right of use.
It is and isn't true to say that an NFT indicates ownership of "a link". NFTs do often contain a link to whatever is associated with the NFT on some server somewhere. This of course raises the possibility that the server will go down, taking 'your' art with it, or that someone will substitute one file for another, so that your unique and 'valuable' picture of an ugly monkey will be replaced by GOATSE (don't Google that if you don't know what it is) or worse. There are supposedly ways around this using a distributed virtual filesystem called IFPS (Inter Planetary File System), but it turns out that content pointed to by IFPS links isn't permanent either, but only lasts as long as people keep accessing them. This is merely one of the problems with NFTs.
But there isn't always a link. In a few cases, the actual art involved has been embedded directly in the NFT. This obviously solves the problem of your art disappearing because of link-rot, but it raises another problem, which is that the cost of creating ('minting') the NFT and handling transactions in which it's involved is related to the size of the data: if you want to throw a hi-res multi-megabyte version of 'your' art into your NFT, you're going to pay through the nose for the privilege of storing all that data on the blockchain, assuming the software will even handle it. The few cases where art has been embedded have involved tiny blocky graphics that take up scarcely more space than a link.
There are also NFTs that relate to some object that can't be linked to at all; as I said, they could be used to encode property ownership records. Or NFTs might encode ownership of virtual items in videogames (or in the dreaded Metaverse), in which case any link is secondary to the use of the NFT to verify the "owner's" right to use those virtual items in the game or virtual world.
So it's not really much more useful to say that the NFT means "you own the link to the art" than it is to say that it means "you own the art". Both may be true to a limited extent (depending on circumstances), but neither is completely correct either.
Getting back to the question of what you own, there's also nothing to stop someone selling multiple NFTs associated with the same piece of art, in which case it's clear that you don't uniquely 'own' that piece of art. There's also no shortage of scammers who will sell NFTs on some piece of art or other intangible object that they didn't make and have nothing to do with. If you buy one of those, it's pretty clear that you can't claim any kind of real ownership over whatever you were suckered into buying because the person selling it had no possible legitimate claim to the object in question in the first place.
And so on, and so on. You can see why I hedged my bets and (over-)simplified things by saying that the NFT says that "X owns Y" because while that's not strictly true, it's closest to the common understanding of most NFTs. I might have got closer to the "Emperor's new clothes" nature of NFTs by saying something like "the NFT is a record indicating that its owner has paid to possess the abstract concept of having some kind of proprietary relationship to thing X" or maybe just "owning an NFT means that you own the NFT", which sometimes seems to be all that it amounts to. But I didn't want to make the original questioner's head explode all at once.
I think this explanation is actually far better than either mine or @Ascania's, in part because it captures the fact that the only truly stable characteristic of NFTs is that only one entity can own a given NFT at any given moment (*).
It also reminds me a little of John Oliver's famous definition of cryptocurrency: "everything you don't understand about money combined with everything you don't understand about computers".
(*) Unless someone forks the blockchain, I guess.
When even the NFT marketplaces themselves admit, that most of the NFT's are linked to stolen or otherwise fraudulent content, the claim about having the ownership of the digital content verified by owning the NFT, has long ago lost it's credibility.