Lost money on NFT

Scottex99

dunstonh said:

Bitcoin at least has an advantage over World of Warcraft gold in that its developers can't press a button and generate more of it. The value of items in a multiplayer game by contrast is totally up to the whim of the developers.
Gamers have traded virtual items for real money since Ultima Online and probably earlier. No problem to solve here.

And the other issue with games is that they have a shelf life.  That shelf life is longer than it used to be with some games but when the publisher decides to put the game in maintenance mode with no new content and then no support at all, then all that money spent buying in-game items was wasted beyond other than the recreational benefit you may have obtained whilst playing it.

The dutch tulip comparison is valid.  There are differences but you effectively have something that some people believe has value and could make money on and lasts until the collective get a dose of realisation.

And keeping with the dutch tulips.
This NFTsold for $401 dollars last month apparently.

Yet this NFT sold for $4 a week earlier.


There are 50 dutch tulips in this collection and 44 of them have been bought.   

Now I am struggling to see how either of those NFTs have any value.   Over 16 million colours available.  A near-infinite variety of colours to use in the image and anyone create a tulip with different pixel layouts (make the angle of the leaves different or the size of the leaves relative to the tulip etc).  

For me, NFTs are similar to the old Panini sticker books e.g. Football 79.  Silver stickers had more value in exchanges than normal and gold stickers more still but some had wider print runs and some were rare.   The value of the stickers was measured in the supply and demand and the popularity of the sticker.    Then when Football 80 comes along, nobody is interested in Football 79 anymore.  Until around 30 years later where 10 people get nostalgic and want to buy a complete collection or fill a hole in the collection.

There is money to be made in NFTs.   Those creating the images to be bought are going to rake it in.   Reselling NFTs though is going to be a lot harder unless we all give up human form and go live in virtual reality.     Once people realise there is no value in 99% of NFTs, the demand will drop away and the ability to resell with it.

Will come back to the points later but 50 items with 44 owners doesn’t mean 44 have been bought. It means there’s 1+ owners with more than one.

Not looked to see if there is any utility (saw something about locked content) and all art is subjective but I think they are cool. Cheapest one is 1 ETH right now

dunstonh

Go back and read a history book. The tulip bubble wasn't just caused by some people believing a thing had value. 

The Dutch Tulip bubble term is used when:
1 - the prices deviate from the intrinsic values significantly.  Largely because of a small number of tulips that did have higher value.  Whilst the majority did not.
2 - A buying frenzy occurs where people forget they are buying something that does not have any intrinsic value.
3 - In the end, people are left holding something that nobody else wanted and any money spent on buying them was wiped out.

You can throw in fashion investing.  ie. Got to invest in it because people on the internet or media tell me its a good thing and I cannot possibly miss out.  Dutch Tulips didn't have the internet but it was certainly triggered by fashion as one couldn't be seen without a collection of tulips.

And you also have the issue that you can just keep growing them just as you can just keep creating pictures of tulips.

You also had the stock jobbers that took a cut. Companies set up purely to trade tulips and take a cut of the trade.  

The whole thing was built on greed and people being persuaded that there was a value because of a small number of cases when there was nothing of value (in investing sense) outside of those.

Too many critical differences make the comparison fatal.

To me, the comparisons are not that different. 

barnstar2077

DunstonH downloaded those tulip pictures for free and used them in his post.  Doesn't that prove that the same picture presented as an NFT is worthless?

Haven't we all seen meme worthy pictures that have gone on to become NFTs?  Why are people paying for something that is all over the internet for free already?

I'm serious, can someone explain it to me please, because it sounds like lunacy.

Scottex99

The same way a print of the Mona Lisa is not the Mona Lisa and not worth 20bn or whatever she is worth.

I can right click save a punk that has a book value of $250k and use it as my profile picture here, but I don’t own the image on the blockchain 

barnstar2077

Scottex99 said:

The same way a print of the Mona Lisa is not the Mona Lisa and not worth 20bn or whatever she is worth.

I can right click save a punk that has a book value of $250k and use it as my profile picture here, but I don’t own the image on the blockchain 

The problem is., using your analogy, there are 40 million copies of the Mona Lisa and they are identical to the original, which is not something that happens with real artwork.  A print of an actual artwork could never be mistaken for the original by anyone with just a small amount of knowledge. 

Scottex99

Fakes end up in museums all the time and that’s after being looked at by 10 experts.

If went to the louvre tonight and switched the original with a print, you and everyone else wouldn’t have a clue when you looked at it the next day.

Now I’m not saying that that automatically guarantees that my “original” on the ethereum blockchain has more value than a saved image someone else has on their desktop by in theory it does.

There is crazy hype around NFTs right now, most of it will slowly die off as people realize that random cartoon pictures of dogs and cats don’t actually have much value. But real value will emerge as the space grows and matures. OpenSea just did a Series C at 300m. I don’t have the figures in front of me but im pretty sure they are making more money daily than big auction houses could dream of

lozzy1965

darren232002 said:

Governmental co-operation hilariously over estimated for decades now. Unsure why you believe people would adopt a controlled privacy-less currency over a decentralised one with some level of privacy. Market currently proving you very wrong on this too.

Because currency only has a value if it is usable.  Crypto is usable at the moment, but there may come a time when it is not allowed by major governments.  It's all very well having a decentralised currency, but if it is banned everywhere then it is worthless.  I'm not saying that WILL happen, but it COULD.  Most people only adopt what the government allows them to adopt.

Alexland

Scottex99 said:

Now I’m not saying that that automatically guarantees that my “original” on the ethereum blockchain has more value than a saved image someone else has on their desktop by in theory it does.

But is there anything stopping me making a higher quality scan of the Mona Lisa as a new digital image file and creating a new NFT of that and arguing that mine is more valuable than yours? The whole thing seems such a pointless waste of time and buyers money - has humanity run out of worthwhile problems to solve?

Malthusian

Scottex99 said:

What about the normal fifa game but there’s 100 gold Ronaldo’s and they are NFTs. Players can trf them directly between each other and EA takes a 5% fee of each trade?

1. That's called "pay to win".

2. There is nothing stopping EA doing that already. Multiplayer games have had unique or ultra-rare items since MUDs in the 90s and have never had any problem tracking their ownership with a simple centralised database.

3. Why would EA allow players to trade Ronaldos and take a mere 5% of profits when they could sell non-transferable Ronaldos and capture 100% of what the market is willing to pay?

4. Games using the ubiquitous "loot box" model immediately run into gambling regulation. At present a gamer can pay £10 of their pocket money for a lootbox of random footballers or guns, and it isn't treated as gambling on the (flimsy) grounds that what they pay for has no market value. As soon as the footballers have a quoted market value, that defence, which is already paper-thin, evaporates entirely.

Now you can pay £10 for a lootbox in the hope it contains a Ronaldo or at least a Rashford or two and you can immediately sell the contents on the market for more than £10. That is indisputably gambling. That means EA has to register with gambling regulators in every jurisdiction it sells the game in, comply with the relevant laws and follow its duty of care to potential problem gamblers.

No problem to solve here bro, maybe next time.

While "pay to win" is a lucrative niche, that niche consists entirely of crappy mobile games terribly translated from Chinese. Both the mass market and the hardcore gamers detest being killed purely because some rich kid spent thousands of dollars on a gold AK47.

What we are seeing here is the classic problem of living in brospace and seeing everything through gold-tinted glasses. Bros say "wouldn't it be great if you stuck NFTs in computer games so everyone could have a chance to get rich quick while they played". What they have missed is that gamers aren't interested in getting rich quick, they just want to play. Explaining this to a bro is like explaining to a street preacher why I'm not interested in going to Heaven. Why on earth wouldn't I want to go to Heaven? Does not compute.

lozzy1965

It's just like buying anything 'collectable' - to those that collect, they gain enjoyment.  To those that don't it is a bizarre way to spend ones money.  When it becomes an 'investment decision' then the advice needs to come pouring in about the risks.
Incidentally, I know nothing about NFT's but game wise (which I know a lot about - and don't waste my money on frivolities) - I presume it is a kudos thing to have a unique looking player/gun/piece of equipment.  Ie. it doesn't have to be an item that gives you a gaming advantage over the opposition.  And there are people with more money than sense that would pay for that.