Nonfungible Tokens NFTs

The blockchain could protect the digital tokens, which could change how art is sold, stop poaching, and give NBA fans a cool new way to show off their collections.

Imagine if the horns, tusks, and furs of animals that are going extinct could be replaced by digital tokens that poachers could use to get what they want. Derek Lewitton is trying to make that happen in Limpopo, South Africa. For a long time, Lewitton, who runs the Black Rock Rhino wildlife preserve, has been a supporter of making the international trade of rhino horns legal and harvesting them in a humane way. He thinks that if the supply of horns goes up, prices will go down, making it less profitable to kill rhinos and take their horns.

Poaching is rarely stopped because it reduces the demand for horns. Instead, it makes poachers more likely to hide what they are doing. So Lewitton’s preserve is now looking at non-fungible tokens (NFTs) as a way to solve the problems of rhino conservation. This month, Momint, the first NFT marketplace on the continent, sold the first rhino horn NFT for 105,000 South African rand ($6,782). It was a digital copy of a horn that was taken from a rhino in a humane way, and the real horn is locked away to keep it safe. The idea is that these NFTs, not real animal tusks and horns that were taken by poachers, should stand in for the animal trophies that these poachers want. Some trophy collectors may want this because they use animal parts as valuable items they can show off. This was the case for Cape Town businessman Charl Jacobs, who was the highest bidder.

One possible use for these digital assets that live on the blockchain and have a history of transactions and owners that can be checked is to stop poaching. Sports fans have already joined in on the trend. The NBA’s sales pitch tells fans to “own your fandom” with its Top Shot NFTs, which were made by Dapper Labs and are basically digital clips of famous on-court moments. Collectors can choose from different tiers of NFTs, which get rarer and more exclusive as they go up the list. Roham Gharegozlou, CEO of Dapper Labs, told Tech Crunch that the product has been very popular so far, going “from 4,000 to 400,000 users in a matter of weeks.” In just two months, 600,000 people have joined Top Shot. NFTs are also in high demand in other places. In the first two months of 2021, almost 150,000 NFTs were sold for a total of about $310 million, which Forbes says is “almost five times as many as were sold in all of 2020.”

But so far, NFTs have mostly been a good thing for the art world. They give collectors a way to check that the assets they are buying are real and not copies. NFTs are like the original Picassos or Monets, while other digital art that looks the same as an NFT is like a print of a Picasso or Monet that you can buy on Amazon. When compared to traditional art, NFTs are different because blockchain technology guarantees the buyer that the NFT is the real original and cannot be copied. For people who care, whether irrationally or not, about being unique and real, the blockchain’s guarantees offer a lot of value that collectors and crypto fans are willing to pay top dollar for.

Even though high-profile auction houses like Sotheby’s and Christie’s have entered the NFT market—Sold Sotheby’s the first-ever NFT by Kevin McCoy for $1.4 million earlier this year, and Christie’s sold a work by Beeple for $69 million—NFTs have cut out some of the middlemen and traditional gatekeepers, which is part of their appeal. If artists want to make it in traditional markets, they have to do things like curry favor with auction houses, galleries, and collectors. Digital artists can now sell their work directly to buyers through a platform. There is no long-term career path or secret group of collectors that can only be reached by a certain broker. “I’ve worked with artists who feel like the internet (like Instagram) has taken away their choice of where their work goes,” writes gallery owner Danny Fuentes in Rolling Stone. “So I think it’s a good thing to be able to add a digital fingerprint and provenance to art in the digital age.” “Artists can attach a royalty arrangement to their NFT, which means that every time the NFT is resold, the artist gets a percentage.” This lets less famous artists make a living if they have a small but loyal fan base.

NFTs also make it possible to try out some interesting things that were once only possible at installations: Sotheby’s is selling Terra0’s Two Degrees, which is set to destroy itself if Earth’s temperature today “reaches at least 2 degrees Celsius above average global temperatures.” Damien Hirst is destroying his own art as part of his project “The Currency,” which involves selling 10,000 unique pieces of art, each of which is worth one NFT. “Buyers would have a year to decide if they wanted to keep the NFT.” If they didn’t, the physical work of art would be burned in a ceremony, “says artnet news.” “Or they could keep the physical work and give up their rights to the blockchain-based art.” This lets people in the market bet on which form of art ownership they think is more valuable. This gives Hirst and others useful information about how people in general see the potential of NFTs.

Some people worry that NFTs are getting too much attention, while others think they’re a bad way to use blockchain technology. “Over the past ten years, the blockchain has become a haven for people who need another place to store their assets,” writes skeptic Anil Dash in The Atlantic. Dash worked with McCoy to make the first NFT. Dash says that since cryptocurrency trading marketplaces are the only blockchain-based apps, this “hermetically sealed economy” means that “people who have made those bets can’t cash in their chips anywhere,” so they use their crypto to buy art in the form of NFTs. Imagine a kid who played skee-ball all day and now has a lot of tickets to spend. Every toy looks like a good idea. NFTs have become exactly this kind of toy. “

At their core, NFTs are a way for creators to make money off of the fact that people still want to own things and value being the only ones who have them, even in the digital age. Whether it makes sense or not, people prefer real Vermeers to copies; real Birkin bags to copies; and real Cartier watches to fakes. This could be for bragging rights or for their own satisfaction. NFTs can be seen as an extension of the appeal of Veblen goods into the blockchain era.

Walter Benjamin wrote in 1935 that “the technique of reproduction removes the reproduced object from the realm of tradition,” because “even the most perfect copy of a work of art is missing one thing: its presence in time and space, its unique existence at the place where it happens to be.” In other words, Benjamin probably didn’t mean that NFTs have to be untethered from a specific point in space, but in a way, they still do. People want authenticity and are willing to pay for it, at least for now. Building on Benjamin’s ideas, John Berger, saying in 1972, “For the first time ever, images of art have become ephemeral, ubiquitous, insubstantial, available, worthless, and free.” He said this was because it was so easy to make copies of them. Berger’s words still ring true today, but NFTs are an attempt to tap into this market for authenticity in a world where everything seems to be the same.

How to Create an NFT