How to make a digital file as valuable as a Rembrandt? – Boxes

01-01-2022

reading time 3 minutes

3572 views

Physical art, such as painting by Rembrandt or sculpture by Rodin, can be worth a lot of money, partly because the original can be distinguished from a replica. But what about creative works that are online and therefore can be copied, downloaded and shared by everyone? So-called ‘non-fungible tokens’ (NFTs) also give this kind of works economic value.

Digital files, such as images, videos, music files, and digital artwork, can be converted into a non-fungal token. An NFT is a non-replaceable, unique and digital proof of ownership. When you buy NFT of a digital file, you become the official owner of that file.

Digital photo is sold for a considerable amount as NFT

We explain it to you using an example. In 2008, this photo of Zoë Roth, later known as Disaster girl, all over the world at once. The picture where the devilishly laughing girl is standing in front of a burning house was massively edited and shared for all sorts of jokes.

tthe text continues below the image.

1240

The now mature Roth sold the picture as NFT for over 400,000 euros. A music studio in Dubai now owns the original image. Roth still owns the copyright, so every time the image is resold, she receives ten percent of the sale. In addition, anyone can still copy, download and share the image. NFTs therefore make digital files that can be duplicated massively valuable. With NFT, the music studio can prove that it has the original in its hands.

A tweet from 2.5 million

In addition to images, all sorts of other digital files are also sold in this way. On March 21, 2006, Twitter founder Jack Dorsey wrote “just to set up my twttr.” This first tweet ever was sold for almost 2,500,000 euros.

figure 1

Another example is the iconic internet video ‘Charlie bit my finger‘, where Harry is bitten in the finger by his younger brother Charlie. The video was sold for more than 622,000 euros.

Price set at auction

NFTs are sold through auctions on online marketplaces. The more people bid on NFT, the more expensive NFT becomes. The price of an NFT is also related to its cultural value. In addition, digital works can have a great collector’s value and therefore increase in price.

Blockchain and the climate

The sale of NFTs takes place via Blockchain technology, ie completely online and without interference from banks. You can therefore only buy most NFTs with ether, a cryptocurrency. Blockchain is a type of public database that, among other things, registers which transactions have been made and who owns which NFTs. The blockchain system consists of thousands of computers connected to each other. Because the computers are constantly raining, they use an enormous amount of energy, even more than an entire country. The impact of blockchain technology on the climate is therefore enormous. Several large crypto companies signed the Crypto Climate Accord in April this year. This agreement aims to make the cryptocurrency world climate neutral by 2040.

What should you be aware of?

It is possible that NFTs are a hype and thus turn out to be less valuable than expected in the future. In addition, the rules regarding NFTs are still in their infancy. If you want to buy an NFT, be sure to do so on a reliable auction site. Commonly used websites are OpenSea, Rarible, SuperRare and Foundation.

The video below also explains NFTs.

Source: NOS, NU.nl, Forbrugerforeningen, Bright

Do you have a question about NFTs or Blockchain technology? Then ask them at Checkouts Q&A! Go to all categories here. Do you have knowledge of a particular topic? Help others along the way and answer questions in our forum!

Join the conversation? You can do that below!

Leave a Comment