Nature of NFTs
1/ Blockchains are unique database architectures that allow for shared state, or consensus between participants on common truth. This architecture lends itself to designating of basic property rights via tokenization & encryption (private keys).
1/ Blockchains are unique database architectures that allow for shared state, or consensus between participants on common truth. This architecture lends itself to designating of basic property rights via tokenization & encryption (private keys).
2/ The 1st use case for property on chain was currency, designed for payments, fiat hedging, expressing/storing value on a common platform. The holder of the keys is assured by network enforcement with property rights. That's valuable in of itself & doesn't require governments.
3/ NFTs are a subset of property for a unique item set, & a misnomer w/ respect to fungibility. It's not a currency explicitly, but obviously carries value. It's a property primitive like a title on your house or car, but different in that it's digital w/ low transaction friction
4/ As property primitives it's the layer 0 of assurances, recognitions, upon which you can build more complex legal transactions. For example, in the physical world I can use my property primitive, my home, in more complex financial transactions.
5/ I can lease my home to a renter, or use it for AirBnB, modify it, borrow against it, or outright sell it. Similarly, most of the discussions we've had so far are about simply minting & selling NFTs, that's simply the most basic financial primitive.
6/ Once minted, an NFT can be used to express property primitives, but the assurances of the blockchain are insufficient. We need more complex assurances, physical as well as digital, to unlock the potential of NFTs. We need real contracts + smart contracts, super contracts.
7/ NFTs are going to explode into complex legal constructions that allow minters to monetize their creation: ex. artists can license creation for merchandise, screenwriters share with producers algorithmically, athletes can monetize performance for games, on and on and on...
8/ All physical & digital assets will be onchain representations of property primitives with the ability for cross chain interoperability with liquid currencies & real world legal assurances of business logic. The next phase of NFTs are about the full financialization of property
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