Tales of the wealthy and influential swindling money from the masses are commonplace in American society, but in 2014 a movement arose dedicated to the rich swindling themselves out of thousands if not millions of dollars. This movement is known as the NFT craze, the digital, modern-day equivalent of snake oil. NFTs are designed with the express purpose of fooling someone into buying what can be best described as nothing at all.
Also known as Non-fungible Tokens, NFTs are often pieces of virtual artwork that can be “bought” and “sold” using cryptocurrency, most notably Ethereum, or ETH.
Because the purchase of NFTs requires cryptocurrency, the buying and selling process is built on a system known as a blockchain, essentially a public ledger that ensures that a specific NFT is “owned” by one person.
What is not known by many of the poor souls on the NFT bandwagon is this: when they buy an NFT, they own nothing. They don’t own the rights to the image displayed, nor are they left with any real form of collateral for their investment. All that they technically “own” upon purchasing an NFT is a virtual space that is represented by the pieces of art on display, rather than the art itself. Said another way, they have essentially paid to have the rights to an entry on a server or database.
This issue is further complicated by the fact that the legal rights to the image displayed remain with whomever produced or “minted” the image associated with an NFT, meaning there could theoretically be multiple NFTS with the same exact image on display but with a different digital space behind it.
If this seems confusing at all, that’s because it’s supposed to be. NFTs are created in such a way as to confuse and mislead people with money into paying for what is the same thing as “purchasing” a star. In other words, they own nothing at all.
Another possible issue is that if a buyer were to simply save the image attached to an NFT and use it for their own purposes, the creator of the art would have the ability to pursue legal action, as, once again, the buyer doesn’t own the image, and therefore has no legal claim to it.
Despite the clear indicators of a bad investment, NFT exchange has ballooned into a multi-million dollar industry — with well-known businesses like McDonald’s and Burger King even attempting to sell their own NFTs. The immense popularity of what could possibly be one of the most lucrative scams of all time can largely be traced to one main factor: ignorance.
With popular social media influencers, like Richard “Faze Banks” Bengston, supporting and promoting NFTs and boasting about a collection of art they don’t legally own, it’s only logical that misinformation has consumed the NFT world. It is that ignorance, then, that has led to an aura of exclusivity surrounding the NFT community. Its prohibitively expensive nature makes it seems like the place to be for people who want to show off or “flex” their meaningless collections of poorly made images they don’t own. Some influencers actually promote NFTs based on some fantastical idea that the digital world will soon become a “metaverse” where their fancy tokens will serve as “tangible” goods in a completely virtual world — a concept that makes as much sense as buying an NFT for millions.
There is yet another cost incured by these pieces of overpriced code, and it’s one that affects the wellbeing of the masses —be they rich or poor — pollution. It cannot be stressed enough that there are millions upon millions of NFTs currently in circulation, a number that continues to grow by the day. As such, more power is needed to fuel not only the addition of new NFTs to the blockchain, but also the maintenance on the infrastructure built around the crypto economy of NFTs.
This, in turn, produces greenhouse gasses, and as the NFT bubble doesn’t seem likely to burst anytime soon, more money will continue to pour into NFTs as more of the wealthy join the craze. It’s a cycle with no end in sight.
Though there have been some steps made by people in the NFT world to change the way the internal systems work so that less energy is wasted, few are willing to risk their investments, and are resisting changes that could potentially harm their NFT income. Until that changes, the common public is once again paying for the whims of the wealthy — and it only adds insult to injury when what we’re paying for is a virtual playground of worthless art.