It's more like a pointer to a JPEG of a baseball card.
If I buy the baseball card, I get whatever (limited) utility it offers. I can put it in an album, frame it and hang it on the wall, stick it in the spokes of a bicycle wheel, use it as a very small shim or insulator.
If I buy the rights to the card, I get the utility that offers. I can contract out and offer reprints of the 1990 Topps Juan Agosto card for the millions of people who want one.
If I buy a NFT corresponding to the photo on the card, what utility have I bought? What new capabilities or rights do I possess? As best I can tell, nothing.
NFTs are the MMO version of the "I am Rich" app with factions and customizable skins. You can demonstrate your economic might by exchanging large quantities of money for something with negligible if any actual utility. But you at least get to pick which particular piece of uselessness you're associating yourself with, so you can use it as a more precise social signaling thing.
Personally, I don't care for baseball cards, I value them about as much as the paper they're printed on. But collectors like them, so if I found one (I dunno, dropped in its sleeve into a tip jar?), I'd check if someone else wanted to pay for it before I started using it as a bookmark.
Same deal with NFTs. The difference is they're brand-new and white-hot, and it remains to be seen if they have enduring value.
My guess: NFTs will continue to be valued, but the vast majority of those which exist right now (and of every NFT ever minted) will be worth so little that it isn't worth the transaction fee to transfer ownership.
The John Cleese Brooklyn Bridge though? It's a great joke! Might not be worth whatever it goes for down the road, but it will probably still be worth something.
Who can make an NFT?
NFTs are Beanie Babies, but instead of a limited edition toy, you get a barcode. Anyone can make them for anything, so there's no scarcity. They're pogs you can't play with.
And just like pogs, when Pizza Hut and Lunchables started making pogs, it was over. Pizza Hut and Lunchables NFTs are coming.
I'm going to go sell an NFT of Jack Dorsey's fist Twitter post NFT.
Any decently print operation? The MLB would come after them if they tried to sell them, of course, but it's not like pictures on cardstock is a tougher technology to recreate than NFT.
Both are only worth something because of their provenance, ease of manufacturing is irrelevant.
NFTs aren't scarce. Anyone can make them for anything. I can sell you the couch I'm sitting on as an NFT.
If I own a Picasso, I could burn it, have my tigers urinate on it, or make sure no other human ever sees it again. I can do whatever I want. What exactly can I do with Jack Dorsey's first tweet? Get him to delete it? Change it into an ad?
There's no legal framework behind NFTs. Ownership is meaningless. If you bought my couch as an NFT, good luck coming to get it.
Also, when the cryptography behind NFTs is broken (and it will be!), what happens to the ownership? If the chain switches algorithms, not everyone will update their keys. After breaking the old scheme, ownership will instantly be impossible to prove.
Next you have the copycats, people selling shovels, and uber drivers investing in it.
Then comes the eternal stagnation.
These are worth jack shit except to the temporary evangelicals buying the craze. They aren't rare, you have to explain it ("I wonder if anyone knows I own the NFT of this song"), and the crypto will be broken before the holders update their wallets to safer algorithms.
Nobody will ever honor your CryptoKitties. You can't use them in Nintendogs or Neopets. The creators won't build a compelling platform for them and they'll simply die from waning interest.
These are moon certificates, except with crypto.
I expect quantum to pick up major steam, especially if major state actors want to screw over the Bitcoin network.
[1] At the price levels we're discussing.
Those are some of the means by which we arrive at price.
> Take this concept to its logical conclusion, and you get NFTs
Mistake this concept for an end by itself and you get NFT.
NFTs aren't attempting to be bearer instruments which convey ownership of some physical good, or even of a piece of intellectual property. Those require a corresponding Ricardian contract. This remains a good idea, but, to put it mildly, there are unsolved problems associated with it.
A NFT is just a baseball card, what you're proposing is more like a baseball player packaging up 10% of his lifetime earnings into 5000 instruments and selling those.
Baseball cards have provenance, scarcity, and IP protection of their appearance: that is, they're demonstrably produced by a company with a right to do it, there are only so many in existence, and it's illegal to make identical copies of the baseball card.
NFTs have two of these properties and an adequate substitute for the third. They're signed, giving provenance, and scarce, due to blockchain-verified artificial scarcity. It's not illegal to make copies of the referenced digital artifact, because what fun would that be? No one could load the image or whatever in a browser.
Nor is copyright currently assigned. I don't believe it's conventional to purchase copyright for an artwork along with the artwork itself, but I could be wrong about that, and it doesn't matter: this would be a cool thing to add to some NFTs, but we can just agree that it isn't a part of the package right now and move on.
But it is impossible to make an actual copy of the NFT itself, even with the private key used to sign the original. That makes IP protection an inferior good: it's fraud to make a forgery of a rare baseball card, but it's quite profitable fraud if one happens to get away with it.
Disclosure: I own no NFTs in the usual sense of the term, and don't intend to.