- NFTs have been laughed at in the past weeks by news reporters trying to get their heads round the idea
- Their responses are reminiscent of similar encounters back in the 1990s regarding the internet
- NFTs are undoubtedly in a bubble, but their idea is too good to die
There is a famous clip from 1995 where David Letterman is interviewing Bill Gates and the subject of the internet comes up. When mocking an announcement of a baseball game being streamed live over the internet, Letterman cracks ,“Does radio ring a bell?”. This quip watched back would have even the great man himself shaking his head in embarrassment. Fast forward 26 years later and the same exact situation is playing out, with baffled news anchors forced to discuss the explosion of NFTs, laughing at how much money is being paid for them and joking that ‘you can’t hang a piece of digital art on your wall’. Once again, early adopters are a laughing stock, but if history is our guide they will be the ones laughing all the way to the bank.
NFTs Are The Perfect Target
NFTs are an easy subject to bash because they combine a new technology, a lack of understanding and huge sums of money. Back in the 1990s very few people understood the internet and its potential, hence the mockery, despite the technology having been around since the 1980s. The ones who did understand it, the ones who were laughed at, made millions and sometimes even billions out of it. Who’s laughing now?
Of course we can’t say that NFTs are going to be bigger than the internet, but the parallels are striking. Just watching a 30 second exchange between two baffled news presenters on the subject of NFTs is enough to realize just how early the asset class is. Part of the problem is that those who only have a basic graft of NFTs (or none at all) dismiss them for two key reasons – firstly because the items themselves can be replicated for free, and secondly that ‘you can’t hang digital art on your wall’. There’s also the spurious argument about their environmental impact, but this has been fueled by mainstream media who can no longer attack Bitcoin’s fundamental use case.
‘Can’t Hang It on Your Wall’
But I digress. To the first point, those who complain that an NFT can be replicated for free are absolutely right – anyone can watch a LeBron James slam dunk online. But this is losing sight of the fact that only one person can own the original, and this is what gives it value. It’s the reason why people (when they’re allowed) flock to The Louvre to see the Mona Lisa, even though they could see it on their computer screen in far more detail without the crowds. The original of something has inherent value, whatever it is, and it is nice to own an original of something that you like.
Secondly, there is an irony in the fact that a trio of 40-something news anchors are laughing about how you can’t do anything with digital art when her kids will soon be at home doing just that – Enjin already has a Minecraft plugin for NFTs, and plenty of blockchain gaming companies are working out how to integrate your NFTs into your favorite game.
Digital Piece for a Digital World
NFTs are digital collectibles for a digital world, not a physical world. Our existences are increasingly being conducted online, and it won’t be long until a killer app comes out that allows NFT buyers to enjoy their collectibles in just the same way as their parents have been doing in the physical world their whole lives. NFTs of the world’s most admired paintings will almost certainly be issued, bought up, and displayed in a virtual museum. Will anyone visit? Of course they will – by the millions.
NFTs are like the internet in the early 1990s and digital music in the late 1990s – they are new, they are misunderstood, and they are currently impractical to use to their full potential. In ten years’ time these same anchors laughing at NFTs today will all undoubtedly be looking back at their very own Lettermen moment and thanking the Lord they didn’t ask, “Do picture hooks ring a bell?”.