NFT — what are for
What is the difference between the Guernica exhibited at the Museo Nacional in Madrid and a JPG copy used as a notebook wallpaper? Perhaps the massive sizes of the original painting does not convey any sensation when resized on a computer screen. Or more simply, a Picasso loses its artistic value if contemplated outside a gallery runs by critics and art lovers.
For someones, the sensations transmitted by oil on canvas can never be reproduced by technology; for others digitization has reached such high levels that every physical product can be reproduced; for still others ones, a painting on canvas and a digital creation are two different forms of art, albeit attributable to a common macro-category.
With regard to the value of the artwork, after all, it is no less complicated to attribute a correct evaluation. Let’s think about what would happen if the Museum decided to sell the masterpiece at auction. Let’s think of a minimum starting value that could be the true value that the history of art recognizes in the work. So let’s think about what value could be achieved based on the economic resources of the participants, perhaps only the need to own that painting or, much more simply, to be able to say to be the collector, the true and only owner of that uniqueness.
Could the new owner of the artwork then get angry because thousands of people have a copy of the painting (which he has just bought) on their computer desktop?
The rules that move the NFT market are the same as those of the traditional art market: probably the problem is not allowing the free distribution of photos or copies of the original work (when recognized as such and when they become an instrument of knowledge for the citizens of the world) but certifying their originality and ownership.
It is at that point that technology is called into question and comes into play without a shot being fired but also without worrying about the exorcists of blockchain and the anti-Bitcoin knights.
We know well that non-fungible token identifies a good considered in its specificity and not replaceable with another of the same kind.
For example: if we wanted to change a kilo of flour with two packs of a half we could do it without problems. After all, even if we wanted to exchange one euro for five twenty-cent coins, we would have no problem doing it, and the same logic applies to any cryptocurrency.
But if we wanted to change Guernica for four pieces of Les Demoiselles d’Avignon, would we be able to close the deal? In the end it would only be a question of exchanging one Picasso for another (albeit cut like a cake).
Beyond the maturity of the artist, the year of realization and the history of the two works that could never in any way justify the provocation of the previous sentence, the artist dresses up that discourse of uniqueness for which during the auction cited above, unimaginable values could be reached for the certificate of ownership of the masterpiece taken as example: unique and not divisible.
So let’s get to the point and see what utility NFTs can bring to this world.
A bit like painting counts among its artists great talents and simple enthusiasts, digital illustration is perhaps the application that makes the house honors in the NFT world, opening the doors of the new artistic era to illustrators and graphic designers of different qualities.
In addition to the unique or limited edition copies that deal with single themes, on the various NFT portals we can also find series that recall cards collections of various games or famous people known to the public.
A collection that is generating no little curiosity is “Bored Ape” whose ten thousand monkeys produced have gone up, through the secondary market, from the initial value of two hundred dollars each to over a million for some specimens.
At the simplest level, the use is not very different from the previous one: a series of illustrated tables produced previously are animated by simulating the movement.
Alternatively, it is possible to make videos that capture the highlights of an event: a Pit Stop during a race, the sensational goal of a famous football player, a rare event.
Just like for the minting of a table, the animation is also recorded on a blockchain: a public database structured in the form of a chain of blocks that contain a series of information encrypted and not editable.This keeps track of all the movements of your investment: from which wallet I bought and at what value I eventually decided to resell.
Alfa Romeo enters the world of NFTs by tracing the life and assistance of its model: Tonale on the blockchain. This NFT will report indications of the car which will also be valid as a guarantee certificate regarding its state of maintenance, also allowing greater transparency even in the second-hand market.
Before Alfa, entered or are close to doing so:
- Lamborghini which coined five NFTs — Space Time Memory — which from an initial auction value of one hundred dollars closed with bids between seventy and two hundred thousand dollars;
- Ferrari that with a partnership with Velas Network AG, based in Switzerland, is already working to enter the WEB 3.0 which contrary to 1.0 and the use of online content, and 2.0 centralized by social networks, aims to provide control and management of own data online, creating a semantic WEB, decentralized finance and digital identity through crypto wallets and open digital economies.
It is not difficult to think about the import / export of goods and their registration on the blockchain via NFT to support Customs; as indeed it is obvious for a large company to want to control its supply chain and life of products or components.
There is a blockchain — VeChain — whose management cryptocurrency is VET which has already set itself the goal of solving this problem.
Its solutions adopted for the real economy have already been appreciated by well-known brands such as: BMW, De Cecco, PwC and even LVMH which, in addition to have a simple production inventory or management software for distribution, want to protect themselves and their customers from counterfeiting of products or parts thereof.
Have we ever thought about what would happen if an non-fungible token were anchored to a physical underlying?
Or rather, if an NFT were a financial good that represents a physical asset, integrated for example within a new “decentralized eCommerce” system?
Boson Protocol, whose governance token is the Boson, has put itself into play with this goal and does so between the “metaverse” and physical reality.
For example, an NFT of an item of clothing or other object purchased using the Boson Protocol in the metaverse would therefore be redeemable as a physical object in the real world and vice versa; representing in fact the right at any time to obtain that particular good in one of the two forms (virtual or physical) provided.
The initiative to provide a way to redeem blockchain tokens with their physical counterpart is laying the foundation for next generation e-commerce applications, through smart contracts that interface blockchain and decentralized finance: the DeFi.
Inexperienced in technology often associate the term metaverse with a “Second Life” style game from a few years ago. It is not wrong to believe that the metaverse also affects the gaming market but it is foolish to believe that it only applies to this.
It is true that you can buy items to win challenges with other players online or to level up, as it is equally certain that these items are sold as collectibles on the blockchain in the form of NFTs, more or less rare and therefore with variable cost, even behind the economic offer expressed in cryptocurrencies by a possible buyer who plays, perhaps, in another team.
Finally, we can safely confirm that brands such as Nike, Burberry, Gucci, etc. have already entered these games, which having a range of customers of different ages can take advantage of the virtual lands to advertise their logo and their items.
The point is that expecting a gamer to connect to a game to rent a real space for a real event or design the interiors of our home becomes utopia.
The question that arises spontaneously, however, is this: “do we believe it is possible to attend a U2 concert directly from our home as if we were at Madison Square Garden?”.
Let’s go step by step:
• we know that there are already applications for augmented reality and glasses for virtual reality that make us live immersive experiences;
• we know that our account can dress an NFT avatar that resembles us or not and corresponds to our identity in the virtual world (in games this happened even before the advent of NFTs);
• we know that through computer programs for technical drawing we can design a space from scratch or meticulously re-propose an existing structure;
• we know that we can assign a space to the avatars we want in the arena, sitting or standing;
• we know that we can design the space for the stage we want, the points where to place the lights, the audio speakers, the advertising of the sponsors;
• we know that through our dCommerce we can sell our NFTs as concert tickets, numbered according to the space we will assign;
finally we provide the link to access the concert, put on augmented reality glasses and, with the hope of not disintegrating the living room at home, it will be like really being at the concert. Looking towards the stage we will see the musical group performing while looking in the other directions we will see the other avatars (real users in the form of NFTs) who will attend the show with us in the numbered spaces corresponding to their NFTs.
Now let’s imagine how long it would take to create a simple corporate room for augmented reality meetings: the same procedure as before and without the sale of tickets, the avatars needed to occupy the seats of the participants in the meeting and our conference room is ready.
As with cryptocurrencies, NFTs are financial assets or services that need to be fully understood. Entering the world of decentralized finance, cryptocurrencies and NFTs randomly means getting very hurt.
It is true that some portals allow the purchase of NFTs also through FIAT currency: the currency with legal value recognized by one or more countries not tied to underlying assets such as rare metals (as was for the gold), energy commodities or synthetic derivatives; but in the end, however, we must not forget that we are in the world of cryptocurrencies and that managing our crypto investments on DeFi knowing the system and choosing the correct procedures brings profits; managing assets without having an idea of how this world moves means losing a lot.
Director of Information Technologies reFRAME