This emoji summarizes it perfectly: 🤢
NFTs are essentially a decentralized >token. This means that they can be >used to represent anything you might >want to represent with a token, e.g. >ownership of a physical object such as a car or a house; ownership of a digital >asset, such as a website or game
No.
NFTs are not proof of ownership. At best they are the equivalent to receipts, at worse they are mere url links. They are certainly not title deeds, not proof of copyright ownership or anything of that sort. They are just a ledger that person D paid something to person C who paid something to person B who paid something to person A.
Lets use those NFT monkeys as an example. There is literally no proof anywhere on that NFT chain that person A is the rightful copyright owner or has the rights to sell said image. Furthermore, there is no proof that person A gave the rights to person B to resell said image. Or that anyone down the chain sold the complete rights instead of just selling the link to access monkey.jpg
The whole point of cryptocurrency is decentralized ownership. That’s the big breakthrough in technology, it’s the whole point of it, I can try to ELI5 how that works if you want to, but for the moment I’m just going to assume you accept that cryptocurrency can demonstrate ownership.
NFTs are an extension of that, except they can’t be split or traded by one another, i.e. they’re non-fungible. Therefore you can by definition prove ownership of those tokens, as that’s the whole point of the technology, which again, if you’re curious I can try to explain how it works.
How does ownership of those tokens transfers to ownership of something else? Well, that’s an excellent question, and the answer is that it happens in the same way that a piece of paper grants ownership of a house. There’s no innovative technology behind that piece of paper, but still everyone would agree that it grants ownership, and the reason is that the authority that enforces that chose to respect that piece of paper. Nowadays this is mostly databases and the piece of paper is just generated from the records there, but this is very insecure as anyone with database write access (or access to the physical folder containing the documents in case of old paper deeds) can transfer ownership. NFTs solve this because only the owner of a token can transfer it to someone else, so they’re inherently safer than any of the alternatives.
Again, the technology is great and has millions of excellent applications, but people use it for pyramid schemes and scamming others, but people do that with any piece of technology.
Buddy must have purchase a couple of bored apes just after the peak. He’s still waiting for them to peak again
The whole point of cryptocurrency is decentralized ownership. That’s the big breakthrough in technology, it’s the whole point of it, I can try to ELI5 how that works if you want to, but for the moment I’m just going to assume you accept that cryptocurrency can demonstrate ownership.
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How does ownership of those tokens transfers to ownership of something else? Well, that’s an excellent question, and the answer is that it happens in the same way that a piece of paper grants ownership of a house. There’s no innovative technology behind that piece of paper, but still everyone would agree that it grants ownership, and the reason is that the authority that enforces that chose to respect that piece of paper.
So NFTs are not inherently proof of ownership as the person above said. The general concept of owning crypto (which no one is questioning here) is a very different topic than using NFTs as proof of ownership of literally anything else.
Do you consider a deed to be proof of ownership? A stock? The registry of a car? They’re not inherently proof of ownership, they’re just pieces of paper or entries on a database. If you go down the road of what is proof of ownership then no technology we have is able to prove it.
The thing is that NFTs you can prove ownership of the token, if the token correlates with something, e.g. if the DMV stored car ownership in a Blockchain, NFTs could be used to represent car ownership in a secure and decentralized way.
