US Culture Goes NFT

That’s apparently the new way to be cool and show off things that others can’t afford with top apes going for $4 million, or some 700 eth.

That’s a lifetime salary, and even then for skilled professionals. Some however make it in a month or a year, so they can afford such luxuries, like jpegs. An ape tokenized jpeg.

What’s astonishing is the speed of adoption. We haven’t seen anything like it, or even near it. It took about four years for bitcoin to get its first ‘celebrity’ and that was some company CEO, Patrick Byrne of Overstock.

We can’t name one celebrity that mentioned defi, while NFTs from the get go got their Newsnight section, and Saturday Night Live even sang to them.

If this was in another industry, we’d just dismiss it as a manufactured nonsense like them South Korean pop bands, but we kind of know how the sausage is made in this industry, so what is going on?

Art Re-Meets the Profit Motive

The invention of the internet turned art into a communistic ‘industry’ economically. Everything free, common ownership, and everyone gets paid a pittance with bread lines and all that or Hackney box rooms for those brave or fool enough to want to paint.

NFTs are the first time in decades that a serious proposition is being made to those artists. You don’t have to produce your work for free online, you can sell it digitally.

There’s a trick involved in that transmutation, which is the current period. What was free and still is free in the jpeg, has to be seen as having actual value and be worth something.

If we were in another industry, we’d say we were engaging in some big lie for the greater good. Kind of like Netflix. We do have Youtube. We used to have Netflix for free with many sites showing you the latest blockbuster. Now people pay. Now people pay for digital news too. They pay for Discord subscriptions, for newsletters, for skins on some game that can go for $200,000 or more.

Some will never pay for any of that. They might not be able to afford it, or they’re basically communists in that they want things for free without much care that means they won’t quite be produced to a reasonable standard, or in some cases there’s more a technical problem in the rails themselves. Just how many monthly subscriptions do you need to read an article nowadays?

In the case of art, there used to be a more fundamental problem in that there was no mechanism to pay for it. You could wall it like on Netflix, but who wants to buy a jpeg? It would just sit on your computer and you wouldn’t be able to show it off, with it having no resale value. Although you could also give it a market within them walls and strictly enforce copyrights, but you’d need to go to a site to see it, and you’d have a bootstrapping problem in getting artists, in getting users, all too much for anyone to even try as at the end of it, it might have even worked.

NFTs are trying with this being the second attempt. The first prominent one was Cryptokitties in 2017 which was a bit of a game in that you could breed kitties with the aim of getting a new one that has rare traits. That’s where demand came for it, the desire to breed and hit jackpot, but it became too popular for the ethereum network to handle at its current levels of capacity.

Second layers are now here and more are coming, with quite a few of these NFT projects, like Bored Ape Yacht Club (BAYC) being a play of sorts on Cryptokitties where you don’t breed, but hunt for the rare traits to the point an ape is now rare in itself.

For how long is the big question. The apes will obviously be there but, will anyone care? Currently, the artists do care and very much. It’s their profit motive. It’s their revolution in a way out of communism and into capitalism.

So when Malone shoots himself buying an ape in his music video, some can dismiss it as he is probably just being paid by the project for it, but it may well be he is being ‘paid’ in a different way. He has a clear interest in NFTs succeeding in providing base value to art because like any reasonable man he hates communism.

Self interest, the profit motive, even greed, would be our explanation for the quick adoption of NFTs by the culture ‘class.’

They’ve just found a way to be paid. And just as this paper would argue, and many papers have argued, that you should pay for news especially by subscribing to Trustnodes, so too this display of apes or punks or even penguins by celebs is probably an attempt or statement aimed at making acceptable the payment for jpegs.

It’s a culture messaging, or even massaging, in an uncoordinated way except through self-interest, aimed at establishing that not only is it ok to buy an NFT, but it is actually cool.

That’s their way of participating in the current debate. In some ways, a vital debate for the art world because communism obviously doesn’t work. So they’re using their microphones to do basically what papers did, or Netflix did, but this time for all art, and with NFTs.

Herding Apes

One reading of BAYC is that the project is saying you’re all apes. Literally, you’re all evolved from monkeys and so you’re all dumb monkeys, we’re all apes.

That’s an insult, but it also contains a critique that calls for a more elevated behavior a more civilized behavior. Less of Russian troops near Ukraine’s borders or prominent Chinese tennis players being censored and silenced or one monkey objecting in Congress or Parliament bringing down a whole bill amendment.

It would be tempting then to read it further as suggesting 50% of the population is dumb, which is why these dumb things are happening and/or why manipulative people can get away with it, including with the use of brutal force at a national scale.

We’re all apes, but obviously the implication is that some aren’t, we are humans with intellect. Now we can stop at: so does buying the ape mean you are dumb or smart?

Or, there’s the algorithm, there’s maths, it’s producing a new shiny toy, look what we apes have created and see now all apes smily and happy. Gods and mortals, or maybe just mortals.

It is probable however few, if anyone, is buying the apes because of meaning, not least because others have a different interpretation. The creators themselves want you to see it as saying ape in. In which case that would be the surface meaning and our advice is don’t ape in, do your research and thinking.

Because there’s a lot of different sorts of algorithms in these matters. The public by now should know and hopefully very well that prices do go up, but they can also go down in this space. If bitcoin is risky, these things are probably 100x bitcoin’s risk.

But they’re not all sophistry. You can copy jpegs, but you can’t copy bitcoin. The jpeg is on the computer, the NFT is on the blockchain.

You can’t copy an NFT, and therefore for projects like BAYC, their argument is that the NFT is not just a number, it’s an access key to a private discord, some scribbling digital wall, actual physical events, and whatever else they might dream up.

A token, of course. Instead of a percentage of the resale price of the BAYC NFTs going to the project creators, they could go to the token holders, with that token perhaps airdroped.

Maybe to just BAYC NFT holders, or they could widen that a bit by also dropping some to Cryptokitties holders, making a statement in a way about potential longterm value.

The value of the token itself would depend on demand for these NFTs, which in turn would depend on what exactly they can get you access to.

Currently, it is mainly music or entertainment. Hence Rolling Stones fittingly covered BAYC, portraying them as a band of sort.

It remains to be seen what else they can expand into as currently this is mainly driver by speculation with a club ticket costing $200 at most.

Eventing also can’t quite scale in the physical world. It could in the metaverse, but you don’t like it very much when you’re not allowed into a part of the metaverse because you don’t have bunny ears.

That conflict, between the desire for open access and the necessity to generate profit, is a delicate and a very complex matter that brings to a clash the ape instinct and the civilized man. Especially if the ticket is $4 million.

You could say what could they possibly do except the allure of exclusivity, a trick of sorts playing on the desire to know when there might not really be much knowledge behind the curtain.

Where the metaverse is concerned for example, fundamentally we see the opportunity to connect Oxford level graduates across the globe. Oxford level being a metaphor, people of exceptional or above average capabilities that do not necessarily have the means or are not in close proximity, with the digital nature of the metaverse making both means and proximity irrelevant.

This bumping into each other of capable individuals across the globe is already happening, but in a somewhat limited 2d format. The metaverse can potentially increase it, hopefully to the level where we then gain the means to conquer Mars and beyond following this blending of merit.

Putting walls on that would have to be limited. You need a blending of the commons and private enterprise, or free and walled. The latter then would presumably be layered.

There’s nothing wrong with a $20 NFT ticket for a movie or music show, or even a game. For things like BAYC however, at $200,000 base tickets, we have the resemblance more of an exclusive gentlemen’s club with access here not through other’s introduction and acceptance, but by buying the NFT.

On the private discord then maybe some of these celebs are there, but presumably they would be too busy to discord. So just how much access you get to anything, is not clear.

A development on that might be university fraternity clubs, where again the access is by paying. Yet these are first experiments and prototypes really. The price and the narrative or the glorification is probably a distraction, more for the apes.

It’s probably what you’d expect on first introduction of a new technology that this time didn’t insta crash the ethereum network, with it so playing out.

Because no one knows which one is the dumb bookstore and which one is the super smart Pet Shop that will change the world.

If we are to risk a Krugman quote, we’d says BAYC is no bookstore, neither cryptopunks, as much as cryptokitties were which can be distinguished because the latter has unlimited supply in theory, but we say so because there isn’t quite scale or scale is difficult to pull off.

However they are an interesting experiments in community building around entertainment, at least as it stands or as it appears. In that, they might even bring a world we didn’t greet, the 70s-80s music scene where you had different tribes of punks and rockheads and electrons or metal with their dress to go with it, and they all hated each other but had fun on the way as some new tribe and type of music played the ‘I am cool’ now until rap came and then never went.

That’s what we are told anyway. Street dancing being cool again would probably be cool, but of course you can say you can go dance on the street without involving money.

In which case, why did they stop, with that stopping coinciding with the arrival of the internet? Because they didn’t go to the cassette store anymore where all this tribalism played out. They listened for free on the internet, money dried up, and rap stayed forever.

This introduction of the tokenomics speculative element combined with ‘cultural’ elements, may send rap packing. And if it does that to rap, why not Hollywood, where we may get pet stores?

Sophistry or I Think?

MySpace gave us a brief view of how art can happen in the digital era. This was a very clunky profile based social network that everyone used or came across when millennials were in university or maybe high school.

The unique thing about it was that alongside with the general Facebook profile view, connections, etc, everyone would put music on their profile. Also real names were not quite used so there were no grandmas on MySpace.

That addition of music led to a boom in indi music, independent musicians. That gave a brief explosion of novelty in music because people were organically discovering it and showing it off. Little known bands topped the charts.

With corporatebook overtaking MySpace, all that indi music stuff went with it. Now we’re back to cloud rap or rock rap. Rap.

With NFTs, we might be back to casually showing off music in a one to many form, or art images, or algo NFTs, or even movie shots. Potentially bringing back that organic discovery and production.

That’s because you hold them on your eth address and so other people can see what you are holding.

Horses, ducks, apes, bunnies, what are those doges and even dinosaurs. That’s some of the collection of this person called Unreal_ who won the bid for a mystery ape 3d box for 0.6 eth at the drop, so coming to our attention.

There isn’t much art work here in the traditional sense of an artist creating a Mona Lisa or a David statue, although he does have some in his collection.

On the other hand you can say all of it is art, just not Mona Lisa level, but for a lot of these the look is secondary. For the first NFT at top left for example, that’s actual digital land in what sounds like a new and a somewhat expensive metaverse.

The NFT is the digital land itself. If this is on IPFS, you could copy it or basically fork the metaverse, but you’d then need to get people to come to yours rather than to the ones that made it and they probably wouldn’t unless you’re exceptional (in which case you’d make your own better metaverse) or unless there’s some serious disagreement about direction in which case the copy-ability is a feature and in some ways, is the whole point.

This is the most concrete example of a unique NFT, something with a concrete use case and something that even grandma would say does have value… depending on usage, execution etc.

That’s expanding nowadays to include designs for this metaverse land you bought, with the design or space being an NFT. In addition to the avatars themselves, wearables for the avatars, and obviously the free popes.

But the others might also show us how art is potentially changing. At the bottom right for example we have “a simulated environment populated by simple machines… after Valentino Braitenberg’s 1984 book ‘Vehicles.’”

That’s a png image that responds to dimming or showing lights by pressing keyboard keys, which is interesting for this format. We saved it, and still works, so now we have it on our computer but it’s not the original and it’s not clear how this would look on the metaverse.

The GEN.ART NFT allows you to “mint exclusive NFT (ERC-721) artwork by world-renowned artists” in addition to a governance token that will be airdropped.

There’s a bit of an element of a gamble here and in many ‘drops,’ initial issuances or mints of new NFTs, in that you don’t know what art work you’ll get in your mint. Thus initially all are of the same speculative value, with that changing depending on what you get.

The pill NFT at the bottom “is a collection of 10,000 unique programmatically generated 3D pills with the aim of being the first consumable NFT across various metaverses. BYOP will also provide each holder a unique AR/VR and Metaverse Trip experience.”

While the Golden Ticket “grants players guaranteed early access to the game. This in turn gives players a head start in accessing game content where limited-edition cosmetic and decorative items can be found.”

The game being by… hmm. “Big Time Studios – a team of veteran game developers who’ve brought you some of the best-loved franchises in gaming history, including Fortnite, Gears of War, Call of Duty, and Overwatch.”

Then there’s the donkeys and apes that you’re all familiar with. The theme here being that you don’t get an NFT, you get something the NFT contains. AR/VR, some game by big shots, a token airdrop by a new art project as well as art or artwork NFTs, partying on a boat for BAYC.

A lot of these are beyond our budget, with the tendency here being to significantly limit supply to 5k or 10k. They could go for a million. Nothing restricts them except mint costs.

It is the experimentation stage so some might try, with the NFT space perhaps better seen as not quite just a jpeg, although there are those too, but a funding method for new projects that are often art, gaming or entertainment focused.

It’s a diverse space, and an evolving one, with significant innovation here because people are funding innovators in the art world.

Thus what is an NFT depends on the NFT. You can’t easily generalize as they’re different depending on the project or even on the NFT itself.

Some of these projects won’t go anywhere. Some might. Which is which, is for the market to decide.