Everything you know about NFTs is wrong.

Everything you know about NFTs is wrong.

TL;DR

  • Memes drive culture
  • NFTs ≠ JPEGs
  • NFTs > JPEGs
  • NFTs are the most powerful social organizing tool
  • For everybody, be it artists, collectors, or the public, NFTs will be enriching our lives
  • NFTs give artists stability, financial opportunities, and no censorship
  • NFTs give collectors security, a new type of exclusivity, and benefits from the public display of the artworks they own
  • NFTs give the public more exposure to art and it does not affect them negatively in any way
  • All creative industries stand to benefit from the adoption of NFTs
  • Scams existed long before crypto and NFTs
  • You can “Right Click, Save As” as many NFTs as you want. It’s not hurting anyone

Right Click, Save As

Many non-NFT heads have been arguing that NFTs are just some very expensive JPEGs, and for those who have not taken enough interest in the matter yet, or the noobies, it might look like these people have a good point. The “Right Click, Save As” argument, along with a superficial analysis of what NFTs are can easily convince oneself that NFTs are JPEGs.

I mean, what else could you think they are when you browse on OpenSea and all you can see are pictures?

So, why would NFTs easily win in a head-to-head battle with JPEGs? Why will all creative industries, or any sector/individual that generates and exploits intellectual property, undergo a paradigm shift in their processes? And why might it be opportune for you to know more about it?
You have the answers to all these questions (& more) below.

Why Are JPEGs Powerful?

First, let’s focus on why JPEGs are powerful on their own. One word: memes. Memes drive jokes, politics, the society, and they act as symbols of our digital culture & identity. News travels the fastest if a meme becomes viral, while tight presidential battles are swayed by some jokers on the internet. The reason why memes are so powerful is that they are public, and everyone can distribute & display them freely (theoretically). On their own, memes are the most effective form of communication for the younger generations. However, beyond this, JPEGs have been a pain in the @$$ for intellectual property holders, and NFTs seem to be able to serve this purpose and more.

Once we take one step further and we think about all those who make a living from their artistic expression, it’s easy to tell that artists struggle. This does not only apply to visual artists, because, with the uncontrollable, free distribution and infinite ownership of digital intellectual property that the adoption of the internet has caused, nobody who generates IP is safe.

The “Right Click, Save As” method has surely made some artists wrongly reconsider their career path in web2. Which is a shame…

So, here is where NFTs step in and get their face value. But, before we go even further, if you’ve been living under a rock and this is the first time you hear about NFTs, I got you covered.
Read this introductory thread to NFTs where I walk you through all the basics.

NFTs vs JPEGs

Okay, everyone back?

Since you’ve read my thread, you know now that NFTs are not JPEGs, but they are tokens on the blockchain that have metadata linked to them. And nobody has said that NFTs revolutionize metadata, a picture is still a picture, as well as a song, but what NFTs are doing is repurposing that data. The important aspect of NFTs is the token itself, the thing that seems the least tangible. Thus, understanding the benefits a token in the blockchain comes with is essential.

So, coming back to memes, the first takeaway is that blockchain offers NFTs the opportunity to become the most powerful social organizing tool in the world. We have never had such a potent meme technology. Unlike in the past, anyone can own a part of a powerful meme, a part of our digital culture. And this is incredible.

NFTs vs JPEGs

NFTs Are Disrupting The Creative Industries

Art serves multiple private and public functions, and NFTs have solved the problem of serving these functions simultaneously, and not only, for all stakeholders: artists, collectors/holders, and the public.
Let’s walk through that.

For artists

Most artists earn nothing from distributing/selling their works: In web2, works are creating infinite digital copies, so, obviously, they are all priced incredibly low.

“If there’s an unlimited amount of something, then it should be worth nothing, right?”

– Someone, somewhere

Let’s use the music industry as an example, the one I know most of, where all web2 streaming platforms provide infinite digital copies. Some have made the remuneration per stream so low that it takes a music artist hundreds of streams to make 1$, with some of it going back to the platform itself anyway. This has been reflected in the streaming platforms’ subscription prices and has created an environment where all competitors are constantly pressured with lowering their prices, for the sole reason of remaining competitive and attracting customers, leaving artists with no way of pushing back.

However, this has not only affected the music artists’ profits but has also driven record labels to sign so-called ‘360’ record deals that take from a music artist’s revenues in areas the record label has no direct connection.

Why? Because music streaming has become the mainstream way of listening to music and record labels don’t make as much money in the streaming era as they did in the CDs era.

Also, 90% of Spotify’s royalties are shared among only 0,8% of ALL artists using it. So, what about the other 99,2%?

A Guide to Web 3 Streaming Services and NFT Music Marketplaces – nft now

With this financial dependency and few alternatives, many artists have relied on investments. These investments have caused censorship, meaning that creators had to follow the investor’s requirements and views, which limited their artistic expression. So, not only artists have never been remunerated less fairly than in the last two decades, but many of them have not even been able to create the art they enjoy doing.

Luckily, NFTs are solving these issues because:

  1. The ownership of digital assets can be scarce again, so, with a limited supply, the price of artworks becomes higher once again, and artists, and the creative industries, can earn more from generating and exploiting intellectual property. Also, artists can benefit from the potential price appreciation of any of their works in the future, in the form of royalties, which makes this even fairer for the creatives.
  2. With this increased opportunity for a better income for all creatives comes the stability they needed. This, and the fact that it is now more likely than ever for an artist to get crowdfunded by those who appreciate their art as it is, through the purchase of primary pieces, and not rely on private/public patronage, is giving the artists the power to produce as they choose, without censorship.

For collectors & the public

In traditional art, the private benefits for collectors and the public benefits for the public are opposed to one another because physical art can only be in one place at once. Becoming the owner of a piece of art meant bringing it home, hanging it on the wall for your enjoyment, for the feel of exclusivity and ownership. So, the art was kept out of the public eye, with only a few people having the possibility to see it, ever.

With collectors buying items to add to their collection continuously, art becomes increasingly inaccessible to the public. And the only way in which the collected physical art can become available to the wider public is if they decide to donate it, sometimes sell it, to a museum that is willing to display it.

Otherwise, even after the death of the collector, the items are passed to their heirs who usually either keep them for their sole excitement or sell them to another collector who will follow the same path as the original one.

NFTs are solving these issues because:

  1. They are separating ownership and identity from the display, maximizing private and public benefits at the same time. One can own a mfer, so they have the private benefits of identity, ownership (they can use it however they wish), and price appreciation, but, at the same time, everyone else can enjoy the piece on the same terms as the holder.
  2. For the first time ever, exclusivity is not decided by the number of people who can see/experience the art. On the contrary, the popularity of the piece appreciates the price for the holder, and the blockchain guarantees that, even though the art is displayed publicly, the proprietor has full control over its usage.

These arguments prove that the “Right Click, Save As” function that many argue defies the purpose of NFTs is wrong. Everyone can see the piece, they can experience it on the same terms as the owner, but token ownership provides unambiguous proof of ownership for collectors, so they don’t have to keep the art they own hidden from the public eye to avoid it being stolen or damaged.

The main point of NFTs is to make content available & free for the public while making ownership scarce. Maybe we won’t all own the next The Weeknd albums, but we will still all be able to listen to his music freely. And this will lead to a significant structural change in all creative industries.

New use-cases

Besides the solutions that NFTs are providing to decades-old problems, they also create new opportunities for the creative industries, in the form of “utility”. Art can now become more than just a “view-only” experience. But this is a story I’ll leave for the next time.

NFTs & Scams

Even though I have praised NFTs long enough, it doesn’t mean that there are no scams and that all NFT creators are doing everything in good faith. There are still a lot of questionable projects and creators, and you should pay attention to that. But within the mass of artistic content that is already being created in the form of NFTs, these scams will eventually spread out, as the buyers will become educated, and the market will be overwhelmed by genuine creators.

Remember, neither crypto nor NFTs have invented scams. They have always been around, especially during the early times of emerging technologies.

This Is Your Chance

NFTs make everyone’s lives better, but it’s a no-brainer for artists to start using this tool, so it might be just a matter of time until they become the main form of digital ownership there is. This. Is. Your. Opportunity. Catch the first NFT drops of renowned artists, and discover talents and genuine creators that have their whole life ahead to develop and create value. NFTs give you access to a kind of investments that only the rich could afford in the past. Wouldn’t it be incredible to own a percentage of Post Malone’s next album? For me, it would. So I’ll keep sure to save money for what comes next: Music + NFTs.

In the meantime, feel free to “Right Click, Save As” as many NFTs, or I should say metadata, as you want. I promise, in the name of all NFT holders, that no one will hold a grudge against you. NFTs were never meant to replace JPEGs or any other file format but enhance their utility.

So, are you still so sure that NFTs have no value?
Challenge me on Twitter – @iamMEANiX.

Do you think I got something wrong?
Let me know on Twitter – @iamMEANiX.

Also, some of my articles will only be posted on Mirror, so don’t hesitate to join me there if you want to learn more about web3, NFTs, music & intellectual property.

Thank you for reading and learning! You are incredible!
Spread the knowledge, we are all ambassadors in web3.

Meet me at the finish line,
MEANiX.

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  1. Very thoroughly article. The problem with NFT’s right now is that there are very few solid accessible projects (under 0.5 eth let’s say) so those who want to join probably buys into a piece of … of a project. And there are also debates about fractionalized NFT’s, as in they are unregistered securities.