NFTs are an unusual idea sweeping through the world of electronic art, allowing people to prove that they own the art. Now, digital artworks that can prove they are one-of-a-kind are being sold for huge amounts of money.
Nyan Cat was a hit YouTube video in 2011. It had catchy music and showed a cat with a PopTart body running and leaving a rainbow trail behind it. The video, and animated gifs (moving pictures) of Nyan Cat can easily be found on the internet. But in February, an animated gif of Nyan Cat was sold for nearly $590,000.
(Source: Chris Torres, Screenshot, via YouTube.)
Electronic art is very different from art made without computers. When a painter paints a picture, there’s only one original painting. It’s possible to make copies of the picture, but these are easy to tell apart from the original. And they’ll never be as valuable as the original artwork.
But with digital art, copies are easy to make, and every copy is exactly the same. If you have a picture on your computer and you send a copy to a friend, the computer files used to create the pictures are exactly the same. This has long been a problem for artists who create electronic art, making it hard for them to sell their work.
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With digital art, copies are easy to make, and every copy is exactly the same. This has long been a problem for artists who create electronic art, making it hard for them to sell their work.
In recent years, people have developed a way for electronic artists to sell a work of art as if it were an original, using something called an NFT.
What Does NFT Stand For?
NFT stands for Non-Fungible Token. Something that’s fungible can be replaced with something else just like it. For example, if you owe someone a penny, and you have two ordinary pennies in your pocket, it doesn’t matter which one you give them. Either one will do. The pennies are fungible.
But if one of the pennies is a rare penny from 1943, then it’s special, and it’s non-fungible. You would lose something valuable if you paid your friend back with that penny.
An NFT lets people treat something that can be copied as if it were one-of-a-kind. The NFT doesn’t actually change the thing that’s being sold, but it creates an electronic record proving who owns it. And people are paying a lot of money just to say that they own things.
For example, a picture called “Everydays: The First 5,000 Days” was sold last Thursday. It’s a complicated picture, made of 5,000 other pictures created by Mark Winkelmann, an artist who uses the name “Beeple”. Even though the picture can be found on the internet for free, it was sold at Christie’s Auction House for $69.4 million.
(Source: Christie’s Auction House.)
It’s not just art that’s being sold with NFTs. Some bands are releasing music with NFTs. Recently, Jack Dorsey, who started the social media company Twitter, put an NFT of his first tweet up for sale. The highest bid so far is $2.5 million.
If copies can be easily found on the internet, why would anyone pay money for an NFT? Some people are buying to support the artists. Some like the idea of collecting rare things or feeling like they own them. Others hope to make money by reselling the NFTs.
(Source: Screenshot, via Valuables.)
There’s at least one big problem with NFTs: the electronic system that keeps track of who owns what. This system uses so much electricity that creating NFTs also creates massive amounts of pollution.
So far, that hasn’t stopped people from spending lots of money on NFTs. And many people think that NFTs will make it much easier for electronic artists to earn real money for their work.
Did You Know…?
The NBA is turning short videos of famous basketball moments into NFTs and selling them. Nike has even come up with a way of putting NFTs into its shoes – but it hasn’t made the shoes yet.