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NFTs and the Blockchain - What the hell is all this?


squirtle
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I keep seeing and hearing these terms and reading articles around them and I just can't get my head around them.

 

Have I got this right? Are they just digital pieces of art that you own and can then sell on at a higher price somewhere down the line? That's what it seems to be. But, that can't be it. Why are EA and Ubisoft saying this is the future of gaming and Valve banning them from Steam and so on?

 

What is going on?

 

Someone please educate this old luddite.

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Imagine if you had Pokemon, and you had a rare one drop and then you could sell it to someone else who doesn't have time to grind but does have money. Or that RARE axe in World of Warcraft. Or instead of grinding lootboxes in FIFA, you spend bitcoin on buying Cristiano Ronaldo from someone else. It's that. So it's just the Diablo 3 Auction House, except this time with a blockchain and we call it play to earn. People loved that Auction House, so this is obviously a huge thing.

 

There are games, like Axie Infinity (It looks like a really shitty Flash card battler), where I think this is already quite successful. If money flowing in and out is a definition of success. It's blockchain and crypto, so also obviously like 90% plus of projects doing this are obvious scams. There's an NFT equivalent of Star Citizen and its vapourware scam! It's called Star Atlas.

 

Obvs I'm being cynical, but I think that's more or less it.

 

There is some discussion that, because your loot/drops become something you "own" as an NFT, that it might mean you can somehow bring your rare Sword of Killing +1 from Game A into Game B. God knows how anyone balances that.

 

The idea of Play to Earn all seems pretty dystopian to me, but who knows.

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It's not inherent to the idea of NFTs that they should be huge energy sinks by definition. It's just that Bitcoin and Ethereum (and I think a lot of NFTs are traded using Ethereum?) happen to be, because of their technology choices. You could make them in a way that doesn't require the energy equivalent of a medium-sized country to run.

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1 minute ago, Uncle Mike said:

It's not inherent to the idea of NFTs that they should be huge energy sinks by definition. It's just that Bitcoin and Ethereum (and I think a lot of NFTs are traded using Ethereum?) happen to be, because of their technology choices. You could make them in a way that doesn't require the energy equivalent of a medium-sized country to run.

But they aren't, and they won't, because crypto is intrinsic to the online culture of the sort of people who either deny or don't care about climate change, i.e. right-wing libertarians.

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@squirtle Yeah - your Pikachu equivalent would be the exact same one as every other one, potentially. But your instance of it is yours, and you can sell that token to me and then I have the Pikachu and you don't. I don't think that's the weird bit - it's no different really to me gifting you a Steam game. I haven't sent you the game in that case, I've just sent you an entitlement. And your gifted copy of Hades is exactly the same as mine. I think for games the issue is what sort of games start getting made around it. We all love microtransactions and lootboxes and skinner boxes. What if we have that, only more of it and explicitly as a way for some players to get rich and others to buy stuff from them?

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1 minute ago, Uncle Mike said:

@squirtle Yeah - your Pikachu equivalent would be the exact same one as every other one, potentially. But your instance of it is yours, and you can sell that token to me and then I have the Pikachu and you don't. I don't think that's the weird bit - it's no different really to me gifting you a Steam game. I haven't sent you the game in that case, I've just sent you an entitlement. And your gifted copy of Hades is exactly the same as mine. I think for games the issue is what sort of games start getting made around it. We all love microtransactions and lootboxes and skinner boxes. What if we have that, only more of it and explicitly as a way for some players to get rich and others to buy stuff from them?

Yeah, that's what I can't quite my head around. Hasn't this sort of stuff being going on in things like CS:GO for years? The making and selling of skins for guns etc?

 

What I don't understand, and what you allude to, is what this means for game design from the big companies? I presume they will make money off all the transactions within their game? Is that it? Is it that simple? I just don't get the wider take on this. We all have a picture of William Shatner, but our receipts are different and worth 100K each. I just don't get it.

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It's fascinating to watch this play out because at the moment it's just some line of bullshit that's been fed to shareholders. Whether or not (and how) that gets spun out in to a real thing, and what that real thing looks like, is another question entirely.

 

Another strand in the rich tapestry of the collapse of the AAA games industry.

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Add it to the Ubisoft pre-release spreadsheet: Far Cry 7 Platinum NFT edition that comes with iconic gun skins and clothing item NFTs you can trade* as well as all the other digital cobblers they shoehorn in to justify the price. 

 

*- you do not own the items, you will own a token representing them that can be traded in the Ubisoft NFT Trading House(tm) on UPlay. 

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Meanwhile:

 

https://www.notebookcheck.net/Discord-Nitro-users-start-canceling-subscriptions-en-masse-as-CEO-teases-Ethereum-and-NFT-integration.577971.0.html

 

Quote

A tweet from Jason Citron, the founder and CEO of Discord, has resulted in a flurry of Nitro users canceling their subscriptions with the popular messaging service. The provocative post featured a screenshot of Discord settings that included new options for storing crypto and NFTs and showed an image of the Discord and Ethereum logos.

 

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From what I've seen, cryptocurrency advocacy tends to to boil down to two core arguments:

 

The altruistic argument: "Crypto has the potential to finally set human society free of the tyrannical authoritarianism of banks! Embracing crypto will benefit all mankind, comrade!"

 

The selfish argument: "Better get in on the ground floor of this sure-fire moneymaking opportunity! Otherwise you and the other granddads will get left behind when these STONKS go TO THE MOON!"

 

Can both be true at the same time? 🤔

 

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I think every publisher is going to at least say they're looking into NFTs, just because their shareholders will be asking about them even though no one involved has any real understanding of what they're talking about.

 

In theory I suppose you could have a blockchain ledger that recorded cross-platform ownership of videogames, so you buy it once and you can then access it on any device in perpetuity. Obviously there's no way that will happen as there's no benefit to platform holders or publishers; no doubt they'd want to take a cut of every 'resale'.

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NFTs aren’t inherently bad, and there are some potentially useful applications. Like, I can see how they could be used for making it easier to manage usage and administering payments for the use of an image or similar - so if you’re a digital artist or a photographer, then that could be useful.

 

Most if not all uses of it at the moment are based on speculation, which is not particularly productive. Once the initial gold-rush fervour dies down then I can see something interesting emerging, but for now it’s all pretty unseemly and a bit scammy. 

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2 hours ago, Protocol Penguin said:

But they aren't, and they won't, because crypto is intrinsic to the online culture of the sort of people who either deny or don't care about climate change, i.e. right-wing libertarians.

 

Ethereum is moving to proof-of-stake.

 

Things that expend lots of expensive energy to produce and maintain are not (as) profitable compared to those that don't. That's the reasoning to move to carbon-neutral/negative right there.

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12 minutes ago, K said:

NFTs aren’t inherently bad, and there are some potentially useful applications. Like, I can see how they could be used for making it easier to manage usage and administering payments for the use of an image or similar - so if you’re a digital artist or a photographer, then that could be useful.

 

Most if not all uses of it at the moment are based on speculation, which is not particularly productive. Once the initial gold-rush fervour dies down then I can see something interesting emerging, but for now it’s all pretty unseemly and a bit scammy. 

 

Slightly OT but... When I worked for a 'futures' company, bitcoin and Blockchain were just becoming a thing.

 

The only real applications that I saw as being genuinely useful were:

 

1. the ability for people who create content digitally, to prove ownership of the IP. In theory, anyone could create a set of code that is unique to them and immediately 'own' it and have unquestionable traceability of that fact. Which NFTs kind of are, but messed up.

 

2. For voting - each individual can have a digital 'vote' that is uniquely allocated to them until the point of transaction to the person/organisation that they wish to vote for. The 'vote' then becomes unquestionably allocated. Of course, the flaw in this idea is that the allocation of the 'vote' to the individual in the first place is open to corruption and social engineering will still make votes venerable to attack.

 

As for NFTs in video games, it's ludicrous because the only advantage is that platform owners won't have to cover the costs of maintaining the registers of who owns what, and can pass that cost on to its customers, effectively allowing for a very cheap way for them to create a trading platform for their players. I can imagine the EA execs:

 

"So you are telling me that we can get the players to take on the costs of maintaining which FIFA ultimate teams cards they own, and they will see this as a good thing? We won't have to managed our own database, and these idiots will do it for us? But that's like 20% of our operating costs? Fucking morons, let's do it."

 

 

 

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1 hour ago, Fallows said:

 

Ethereum is moving to proof-of-stake.

 

Things that expend lots of expensive energy to produce and maintain are not (as) profitable compared to those that don't. That's the reasoning to move to carbon-neutral/negative right there.

 

This is an interesting, short thread on a related topic, by a guy at John Hopkins

Sounds like PoS moves you away from decentralization? So is ETH definitely going to do that?

 

Disney are selling NFTs of a Wall-E poster. scanners.gif

 

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2 hours ago, Fallows said:

 

Ethereum is moving to proof-of-stake.

I read something linked to on here that said they've been saying that for a long time without actually showing any evidence they are doing something. Is that true? 

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39 minutes ago, Gabe said:

I read something linked to on here that said they've been saying that for a long time without actually showing any evidence they are doing something. Is that true? 

 

I don't think it is, no. https://ethereum.org/en/eth2/

 

Personally I have more than several ETH already staked with the foundation. I don't get control of that back until Eth2 launches, so I have full faith in them coming through.

 

For any form of financial energy to reach peak efficacy it has to do the polar opposite of burning fuels and gases, or it's just energy and environment wasted. Many other POS blockchains are now picking projects off of Ethereum due to the insane gas fees. They're well aware of this, and they need to act fast before they're made redundant.

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3 hours ago, BeeJay said:

 

We won't have to managed our own database, and these idiots will do it for us? But that's like 20% of our operating costs? Fucking morons, let's do it."


yeah if each database entry wasn’t an utterly trivial amount of their operating costs compared to their existing minimal customer service and having reliance on a third system.

 

I’m with K. There might be a use, though not in games, but only when the speculation bubble passes. You could imagine a version of Getty Images, that doesn’t involve everyone always paying a fee to Getty: but you’d still need the Getty lawyers checking who’s just ignoring the smart contract and right click saving.

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6 hours ago, Uncle Mike said:

Imagine if you had Pokemon, and you had a rare one drop and then you could sell it to someone else who doesn't have time to grind but does have money. Or that RARE axe in World of Warcraft. Or instead of grinding lootboxes in FIFA, you spend bitcoin on buying Cristiano Ronaldo from someone else. It's that. So it's just the Diablo 3 Auction House, except this time with a blockchain and we call it play to earn. People loved that Auction House, so this is obviously a huge thing.

 

There are games, like Axie Infinity (It looks like a really shitty Flash card battler), where I think this is already quite successful. If money flowing in and out is a definition of success. It's blockchain and crypto, so also obviously like 90% plus of projects doing this are obvious scams. There's an NFT equivalent of Star Citizen and its vapourware scam! It's called Star Atlas.

 

Obvs I'm being cynical, but I think that's more or less it.

 

There is some discussion that, because your loot/drops become something you "own" as an NFT, that it might mean you can somehow bring your rare Sword of Killing +1 from Game A into Game B. God knows how anyone balances that.

 

The idea of Play to Earn all seems pretty dystopian to me, but who knows.

 

None of that requires an NFT. If games developers want to do it, they could implement it today using a database.

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5 hours ago, squirtle said:

OK. I was just reading on Kotaku that the actual digital asset is not even unique, it's the receipt that is, the token. What the hell?

This is an important thing people miss. You only own a receipt which marks you down as the owner of something at a URL. The thing itself can get deleted or amended.

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3 hours ago, K said:

NFTs aren’t inherently bad, and there are some potentially useful applications. Like, I can see how they could be used for making it easier to manage usage and administering payments for the use of an image or similar - so if you’re a digital artist or a photographer, then that could be useful.

I have commissioned and paid for digital art. Shutterstock make a living selling it. Absolutely no NFTs required.

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