THE MEDIUM UNLOCK TIME CRACKED

NFTs aren’t the only way to create scarcity and authenticity online - trusted, centralized entities such as banks (and platforms such as Twitter and Apple) do it within their verticals, and blockchain tech is evolving to address myriad environmental and security concerns. NFTs offer the promise of scarcity and authenticity for digital goods. Bitcoin’s “proof-of-work” system likewise ensures scarcity (there will only ever be 21 million bitcoins produced) and authenticity (all are tracked on an immutable public ledger). Treasury can make it (authenticity) and we trust Uncle Sam to mint a limited number (scarcity). A dollar bill is worth $1 because only the U.S.

THE MEDIUM UNLOCK TIME CRACKED

Bitcoin became a trillion-dollar asset class because it cracked this code. Google put the news media into intensive care by reproducing its content (ending scarcity), and Facebook drove another nail in the coffin by de-emphasizing the source (neutering authenticity).Įnter blockchain.

The pirating of digital goods of all kinds reduces both tech profitability and long-term innovation.

Napster broke the barriers of scarcity that were inherent to physical distribution of music on plastic discs. Limited options for credible scarcity and authenticity have rendered digital commerce chaotic. Authenticity’s virtues are practical (we like to know where our food comes from and who we can sue if it makes us sick) and philosophical (if we buy music, is some of the money going to the artist who made it?). Our cravings for sugar and fat (historically scarce) have resulted in an obesity crisis, because our instincts haven’t kept pace with industrial food production. A scarcity mentality is built into us at an instinctual level. NFTs offer digital commerce something the Internet lacks: scarcity and authenticity. As private property and ownership are central to capitalism, and economic activity increasingly moves online, NFTs may become central to our economy. Digitally native, NFTS are (theoretically) lower cost than real estate deeds - thus they’re economically practical for digital items and lower-value property. NFTs, or non-fungible tokens, are deeds rendered in the world of bits, not atoms. It’s worth the expense, as real estate is valuable. Real estate deeds rely on an ecosystem of paper and electronic records, legal standards, and institutions staffed by experts. A digital document that identifies one true owner of a digital product.

So … WTF is an NFT? Technobabble aside, it’s similar to the deed to a house. The sun may have passed midday on the hype cycle, but NFTs (or something similar) have real potential to be an unlock for a fundamental aspect of the digital economy.

The medium unlock time