Thread by @RaoulGMI

It's Friday, wine night and time to write a thread on NFT's, inspired by my chat on @RugRadio. I think people are massively underestimating what is going on... and its only (very) partially to do degening with monkey jpegs and dickbutts...

Let's talk...

An NFT is a "smart" "contract" "stored on a blockchain". We all know that.

But have you thought what that really means???

Well, there are 3 component parts:

"Contract" - almost every single agreement in society in the broadest sense is a contract - be it written, implied, verbal from religious vows to airline tickets, from meeting a friend for a rum or using Twitter. Contracts are literally a base layer of society that build on trust

"Stored on a blockchain" - all contracts are stored to set a record of them - handshakes, nods, rooms of lawyers, databases, blockchains, etc. They essentially are a settlement mechanism, whether disputed or agreed.

"smart" - the settlement mechanism is automated by code and resolves without the need for 3rd party enforcement - courts, lawyers, notaries, accountants, etc.

I won't bother to go into the decentralised element as I think you all get that by now. In a nutshell, decentralised databases are more secure and robust than centralised. Clearly, this could be a 50 tweet thread on this alone but I'll leave that to others.

Right now, people think of NFT as art or community. Both are amazing use cases for NFT's.

We will see all cultural assets digitised and tokenised. My friend and colleague and President of @sciencemagicxyz , Tareq Nazlawy, pioneered this with Adidas, proving that...

By transferring a very physical thing - a sneaker- into a digital thing, it had equivalent, or even more, value.

This was a HUGE step in understanding that the digital world has the same human drivers as the physical world - status, belonging, etc and that derives value.

@hirst_official split the art world by doing both digital and physical and giving people the choice (outcome was close to 50/50) or artists like @lphaCentauriKid moved from digital to physical or @beeple blew the art world apart by proving digital was as valuable a physical.

We seen the rise of community, art and culture like #rektguy or Yuga's #BAYC or @CryptoDickbutts, #mfers or whatever. So many amazing projects, it a cultural explosion!

We have seen the start of music NFT's from @RAC, the work of @Cooopahtroopa and @3LAU and others.

We are seeing books and films from people like @benmezrich and @dan_sickles and historic IP from @KeithGrossman

While the tokenisation of culture is almost infinite and has only just started, most people miss the even bigger picture...

ALL contracts will get tokenised as NFT's as they more efficient, cheaper, faster and more secure.

ALL: ID, tickets, reservations (hotels, airlines, trains, restaurants etc), all insurance contracts, internet permissions, hotel keys, car documents, real estate, certifications

...advertising, supply chain contracts, inventory management, business deals, driving licenses, medical records, employment history, references, etc etc... but it gets even bigger...

The entire financial industry is based around contracts at a truly VAST scale - too big for the old City of London "My Word is My Bond" system to work and a two party, audited ledger/database....

There are somewhere between $650trn and $4 QUADRILLION of derivatives, $250trn of equities, same in bonds, etc. These are all non-fungible contracts of sorts (some are large and some are 1 of 1's like a special OTC option)..

All asset management and funds will be tokenised too. It is much faster, accessible, transparent and more efficient.

AND the "smart" element of NFT's mean that enforcement or dispute resolution is automatic, cheaper and faster, as is "storage or ownership"

No one can get their heads around this.

Everyones anchors of a linear path of what is happening today but miss the BIG picture, which is truly exponential in nature.

Some of it will happen fast and some over time.

It also has other benefits...

It frees up velocity of money through less trapped capital, settlement, dispute, enforcement, etc. It makes the system infinitely less capital intensive. It is also transparent.

And it can create liquid(ish) secondary markets of all of it...creating capital efficiency

And you thought it was just about the BIG concept of ownership of digital assets in a digital age...

My frens... you are missing the REALLY BIG picture.

EVERYTHING will be tokenised.

NFT's, fungible tokens and blockchains (and who knows what else is to come) will run it all.

gn!