What the Tech? What’s an NFT and Why Are People Paying Millions for Them?
Over the weekend someone bid $2.5 million for an autographed original tweet by Twitter co-founder Jack Dorsey.
It left most everyone asking “how do you buy a tweet?” and “why would you want to buy a tweet?”. Both valid questions.
How do you buy a tweet anyway? Isn’t it on the internet for everyone to see and copy and save? It’s a rather good example of a new trend and technology in the art community called an “NFT”.
Let’s start by saying to most of us, an NFT is going to sound crazy, maybe even stupid. But they’re a real thing. Well sort of. An NFT stands for non-fungible token. Fungible is anything with a standard value such as gold or currency.
They’re worth what they’re worth. A $20 bill is worth two $10 bills. Non-fungible items are generally works of art or antique furniture. Their worth is determined by what someone is willing to pay. So an NFT is something that can be auctioned off
to the highest bidder.
In the case of an NFT, it’s not a tangible item like a collectible sports card or ancient relic but a digital piece of art in most cases. Since the artwork is digital and on the internet, people buy and sell them using the “t” which stands for token. It’s basically computer code for the original digital artwork. Are you with me so far?
Christie’s Auction House is auctioning off digital artwork by the artist “Beeple”. The highest bid is currently $4 million and likely much higher by the time you read this. The winner of the auction will receive the one-of-a-kind token or computer code, making them the sole owner of the original artwork.
The owner could print it out for a display of course, or display it on a video screen in their home. Or, like other works of art, they may sell it to another collector. Purchases are paid for using cryptocurrencies such as Bitcoin or Ethereum.
Smaller artists are using NFT’s to finally be able to sell some of their digital artwork which can be images, video, music, or a combination of all three. NFT’s selling for 6 figures or more include animated memes, short video clips, and an autographed first tweet from Twitter co-founder Jack Dorsey.
So what’s stopping someone from printing out that artwork and hanging it in their home?
Nothing. It’s the same with a downloadable picture of The Mona Lisa. You can display it or use it as a screen saver but it isn’t the original. Purchasing an NFT is proof you own the original piece. For collectors, that’s a big deal and why NFT’s are getting lots of attention (and bids).
How soon before you walk into the home of an art collector and see a digital piece of original artwork on display on a large video screen? How soon before we see collectible NFT’s (maybe even Dorsey’s tweet) on display in museums? Something tells me it won’t be very long.
NFT’s have been around for a couple of years and since so many artists are creating digital art now that lives on the internet, NFT’s may indeed be the new way to collect artwork. Kind of crazy yes, but not stupid.