You Can’t Escape NFTs

Inspiration for the reluctantly curious

Keep hearing about NFTs? Yup, thought so. NFTs (non-fungible tokens) are attracting a diverse audience in a way I haven’t seen happen much in my multi-decade career in tech. How many things are there that captivates the attention of developers, celebrities, auction houses, musicians, meme creators, and investors? It’s wild.

The form that NFTs took to break into mainstream consciousness might look frivolous — seriously, multi-million-dollar JPGs? — but there’s a lot going on here, and it’s worth seeing if you are curious about any part of it.

Now, listen — I get it. There’s something about crypto and its most vocal proponents that can make it feel like a toxic cool kids club. But, if you go past that bro-riffic, eye-shooting-laser vibe, you might find a rich new world that has a place for you in it. And to be honest, you might not have a choice, so it’s worth understanding what’s going on here.

I want to show you a few of the sprawling aspects of NFTs that I find interesting and that have sparked curiosity in so many people to see if anything jumps out at you. As my new friend Christin put it, it’s about finding the “not yuck” in all this stuff. You in?

The Tech
Alright, so bear with me. We gotta start with possibly the most boring part to you, the technology. But it’s important! The underlying tech — the blockchain — itself is not new, but new features are being built daily on top of this tech. There are engineers and other fans rallying around the technological innovation piece of NFTs. These are the builders, the early adopters, and the ones pushing the functionality of NFTs further. It’s a niche crew, but without them, NFTs don’t exist or evolve.

Digital Scarcity
Ok, cool. That wasn’t so bad, was it? Now! A super exciting thing about NFTs is that they enable digital scarcity. In the olden days (a few years ago), when someone created and shared a JPG, you could download it and use it however you wanted. There could be infinite copies of that JPG, which rendered it pretty much valueless. This is all still true, but check this out — the blockchain establishes the ownership of a digital asset. With NFTs, everyone can see that you own a particular JPG. Why do we care? Let me show you…

Collectibles
Since NFTs allow you to own digital things, that makes them the perfect digital collectible. Sure, collectibles are nothing new — we’ve got baseball cards, vintage toys, and whatever sneakerheads are into these days — but prior to crypto, digital collectibles only really clicked with gamers. The popularity of collectible NFTs has exploded with profile pictures (PFPs) you can use on social media, one-of-a-kind artworks, pre-release songs, and licensed sports video clips.

Status & Access
Now that collecting NFTs is most definitely a thing, the rarest collectibles have become the new status symbol. There are all kinds of reasons why (some have historical value, some are created by notable artists, some are just really freaking expensive), but these NFT prizes have become intertwined with personal identity. The hottest NFTs can grant you access to elite communities of crypto whales and lucky early adopters. The owners of pixelated frogs in hats and oozing zombie apes update their Twitter profile images to feature their tokenized ego…or just to signal to their tribe that they know what’s what.

Speculation
But, of course, with any gold rush come the opportunists — the speculators. NFT flippers buy low and sell high for personal gain, regardless of the impact on the greater market. Lots of people see this whole NFT business as a big ol’ pump and dump scheme that takes advantage of the suckers left holding worthless bits and bytes when the music stops. Another way to look at it though is that there’s an entrepreneurial spark in many of us. It’s thrilling to find a new way to make money with a bit of knowledge and luck. It’s a game with real potential upside, or losses, and that can be pretty damn compelling.

Creator Monetization
So who, besides the speculators, are making money off of all this? Creators of profile picture collections reserve some items to keep as a reward for their efforts and to further fund the project. Creators of one-off artworks pocket nearly all the money when patrons buy their art. Here’s where it gets cool though — NFTs make it possible for a creator to get a cut of all future sales of their artwork. That’s a big deal!

Artists got kinda screwed when the world went digital, especially with middlemen like record labels and galleries taking hefty cuts before paying out profits. Now artists can not only sell directly to their fans and supporters but also continue to earn income from their work as long as it holds value to people. And remember that bit before about access? Imagine an artist allowing their NFT owners private access to some IRL or online experience. It’s a new era with new money-making possibilities for creators, and the party is just getting started.

So, there you have it. It’s not an exhaustive list. There’s a community aspect of NFTs that’s fascinating. Oh, and there’s a hot environmental debate around the energy costs of crypto mining. Hop onto YouTube and you can go as deep down the rabbit hole as your heart desires. I’m not recommending that you immediately go set up a crypto wallet and start buying $800 profile pics. Just check out projects on Opensea.io, follow a few NFT accounts on Twitter — just take a tiny step into this world and see what interests you.

I’m not an expert on NFTs, but I’m talking to people who are deep into it and the surprising thing is: they’re still learning, too. No one knows where all this goes or what it means because it’s never happened before. We don’t know what creators will dream up next or how people will behave in the face of all this new technology and culture. You know what that means though? It means that you’re not too late. There’s so much left to be discovered with NFTs and I think it’s exciting to be a part of it.

So pull the thread. Let your curiosity guide you. It might just take you all the way into…the metaverse. Whatever the hell that is.

None of this is investing advice. In fact, you should probably be willing to lose every penny you put into risky assets like NFTs, just like you would with slot machines in Vegas.