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NFTs - If You Don鈥檛 Know, Now You Know | The Daily Social Distancing Show - YouTube
Channel: The Daily Show with Trevor Noah
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over the last few weeks you may have
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heard people talking about
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nfts which i found out too late
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does not stand for nudist fishing trip
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again i'm sorry but what are
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nfts and why are people trying to get
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rich off them
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well let's find out in another episode
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of if you don't know
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now you know
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if you've heard about nfts you probably
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know that it's the latest hot trend that
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teenagers have to explain to their
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parents
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and grandparents and boyfriends but this
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trend also has
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big money behind it it's a new craze
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breaking out in the crypto world and
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it's all about crypto
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collectibles non-fungible tokens or nfts
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are exploding in popularity
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in february alone nft sales hitting 340
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million dollars
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that's up from 12 million dollars in
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december
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nft stands for non-fungible token
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now in economics fungible means you can
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trade one identical unit for another i
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think a dollar bill
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gold oil or bitcoin non-fungible means
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it's unique it can't be replaced
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in music the kings of leon releasing an
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nft only album
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in social media jack dorsey's first
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tweet selling for nearly three million
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dollars
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the art world just turned upside down
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with the sale of this
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digital collage entitled the first five
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thousand days a work that took 13 years
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to create
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it sold thursday in an auction for 69.3
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million dollars
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that's right move over gamestop there's
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a new
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confusing internet money thing in town
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but yes
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nfts are blowing up so much right now
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that one
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digital collage sold for 69
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million dollars 69 million dollars
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i would never pay that much for a
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collage
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never unless it was the one from that
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tupac video
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where all the little videos of tupac
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turned into one giant image of tupac you
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remember that
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yo that blew my mind but if i did
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spend 69
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million on a picture best believe that
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would be
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the only picture i show people ever
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again didn't you just have a baby trevor
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yeah don't don't worry about that don't
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worry about it look at this though look
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at this picture
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69 million dollars 69
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million dollars shut up huh
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the problem though is that if digital
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pictures become the new status symbol
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you realize that rap videos are about to
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get boring as hell
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because i mean instead of showing off
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expensive cars or pet tigers
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man what rappers are just gonna be
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clicking through their computer
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now this may all seem insane but the
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truth is guys the idea of spending money
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on digital collectibles isn't much
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different
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than spending money on anything else you
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know anything else that people collect
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like baseball cards or beanie babies or
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the
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fingers of secret service agents nfts
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are really just a new twist on that the
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idea of collectibles has always been
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very physical you have comic books that
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you read or you have art that you hang
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on your wall but with these it is meant
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to be entirely digital
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on the surface buyers appear to be
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purchasing what's already on the
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internet for free
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like this video of a monstrous dunk by
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lebron james
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the clip recently sold as a digital
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trading card
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for two hundred eight thousand dollars
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but you can still watch it online at no
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cost
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think of the mona lisa it's an original
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piece of art it couldn't be swapped out
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for say a mona lisa poster from the
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louvre gift shop
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because the poster doesn't hold the same
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value
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exactly a mona lisa from the gift shop
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isn't as valuable as the painting itself
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unless
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leonardo da vinci also painted mona lisa
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onto a mouse pad
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oh if you don't mind can you stay a
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little longer please this one is for
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greg and
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hr's desk okay yes a smile but not
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too much a smile just like a kind of
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smile ah perfect perfect
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oh he's gonna love this one for the
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mouse huh and i know i know right now
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you might be saying but trevor why would
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i want a clip of lebron dunking i'd
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rather have an nft
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of something you never see like the
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knicks winning a championship
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but it's not just a clip of lebron
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dunking it's the official clip
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of lebron dunking and that's what makes
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it valuable
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because people love to have things that
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no one else
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has check out this dog turd ew
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gross it's the only turd that dog
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ever made i'll give you a million
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dollars for it
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and if you're thinking that's kind of
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unusual but it would still be cool to
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buy the original version of a digital
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artwork or a song or a video
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well here's where it gets weird that's
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not exactly
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what you're buying either an nft is kind
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of like a certificate of ownership for
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virtual assets
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essentially when you buy an nft you're
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not buying the horse the horse is
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somewhere else
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you're buying the racing papers that say
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here's where the horse came from here's
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who
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who's owned it over all these years
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here's this horse's record what the
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buyer gets
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is essentially a long string of numbers
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and letters it's a it's a code
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that exists on the ethereum blockchain
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it relies on blockchain technology
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sometimes described as a kind of digital
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record keeping
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it's a secure way to track when digital
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items change hands online
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yes essentially what you're buying with
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an nft
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is a long digital receipt that has
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your transaction along with every
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transaction that has
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ever happened so basically it's like a
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cbs receipt
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you know it's miles of irrelevant
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information but somewhere buried in
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there
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it says that you bought a gatorade and
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some pretzels and maybe condoms but not
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condoms you went for the gatorade and
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pretzels
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in other words the point of nfts
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is to create artificial scarcity and
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this isn't
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just so that speculators with too much
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money can make even more money
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it can also be a way for artists and
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musicians to make a living in the
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digital age
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like right now one of your favorite
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musicians
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is probably scraping by on a fraction of
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a penny every time someone streams
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one of their songs but if they auction
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off that song to the highest bidder as
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an nft
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now that musician that you love won't
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have to rent out his face for ad space
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but there are also some potential
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problems with nfts for one thing
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like cryptocurrency making some nfts
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requires
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massive amounts of energy which
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contributes to
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climate change so every time you buy one
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you basically have to think
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how many polar bears am i willing to
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kill
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for this distracted boyfriend meme i
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mean not five
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obviously but maybe four oh and there's
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something else you might want to
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consider before you sync your life
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savings
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into an nft along with all the hype
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around nfts experts have raised some
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concerns
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basically the blockchain
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is is a permanent record while the
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record
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is permanent and stable the location
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where the work is hosted may not be
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effectively you're buying access to a
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code that runs through a gateway online
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if the gateway effective the website
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goes down
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you've lost whatever you just bought and
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if that server
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happens to be holding the object goes
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down or it's moved who's ever
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controlling it forgets to pay their
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hosting fee
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then your nft could point to nothing
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let's say that i buy an nft
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and i go to the link for the third party
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hosting thing
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that has gone down and what i see is the
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most expensive 404 of my life
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man if i spend 69 million dollars on a
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jpeg you better believe my basement is
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gonna have more backup servers than
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hillary clinton
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imagine if you spent millions of dollars
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to own the crying jordan meme
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and then you lost it now you don't even
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have a meme to show how sad you are
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like this would be the dumbest way
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possible to lose a valuable collectible
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at least if you lose a rare piece of
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artwork what happened a cat burglar
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that's a pull off like an ingenious
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heist
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to lose an nft you just need a janitor
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to bump the surge protector with a
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vacuum
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so now you know about nfts
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and they may be the next big thing in
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the world of collectibles
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but if you invested in one you better
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pray the server that's hosting it
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never goes down otherwise
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that rap video is about to get real sad
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mom the thing shut down
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[Music]
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mom
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you
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