I have made an effort not to get involved with NFTs because as one of the first crypto adopters I've been more preoccupied with developing or supporting the development of true fungibility.
Why is fungibility important?
The way I see it fungibility is achieved through privacy, in my mind even cash fiat, since it has serial numbers that can't be changed and thus can also be flagged, is not truly fungible.
Bitcoin is not fungible, for example. Or do you really think your coins are worth the same as Satoshi's? I'd buy 1 Satoshi associated to Satoshi Nakamoto for the price of a whole Bitcoin if I could...and if Satoshi's wallets ever transact again I am certain we will see a lot of volatility in the entirety of the blockchain market.
Not all coins are created equal, but even if they are...will all coins be treated equally?
That is my concern, where my fixation comes from, as far as fungibility is concerned. I could have a ton of money in Bitcoin, and if all major exchanges say that my bitcoin are blacklisted as coins that were involved in criminal activity or the deep web...well, I'm going to have a very hard time getting rid of them and will probably have to sell them for a lower price than the market average, perhaps even incur in a loss.
Do not make the mistake of thinking I'm speculating on improbabilities, this is already happening. A friend of mine received some bitcoin from his employer and one of the three biggest exchanges sent him an email with a warning. They were telling him that his bitcoin were basically dirty, that they had been flagged for allegedly having been used in the deep web at some point.
My friend immediately took his money out, smart. These people were threatening to seize his money if he ever deposited bad bitcoin again. The problem is, how can my friend tell whether the bitcoin are dirty before he receives them?
If I don't like someone and know their public address to their favorite exchange, couldn't I just send a couple of deposits containing dirty bitcoin to that address and have the rest of their rightfully-owned funds taken from that person? They can't reject the bitcoin that I'm sending and the exchange has no way of telling it was a different person who made the deposits.
Here's a kinder-level math test: If you have 1 billion dollars but you can't spend any of it, how many dollars do you really have?
And this, my friends, is why I'm more concerned with fungibility than its opposite. We already have plenty of non-fungible things to worry about.
Am I against NFTs? Absolutely not! When Opensea.io first started I was actually writing for a magazine strictly about NFTs, this was around 2018 when no one was really into NFTs so I had to read and think about the subject plenty. Are there good applications for NFTs? Absolutely! Real estate titles, birth certificates, ticketing, etc. are all good applications for the technology in my opinion.
I actually got my first NFT here recently but there are actual benefits to having ownership, not just bragging rights. If I wanted to brag I'd just say I've been one person away from both the creator of Ethereum and Bitcoin 😎
What is not a good application for an NFT contract? Art. Plain art. Plain digital art...even if it's animated. I don't see the use. Could a ticket or loyalty program in NFT format also include a unique image? Yes, that sounds awesome, but there needs to be some utility else it's just a picture associated with a serial number...you don't even need a blockchain for that.
Ticketing, real estate, identity documents, loyalty programs...those are the applications I see for NFTs right now, though that might change in the future.
Shhhhh! Don't tell anyone! This is the easiest way to onboard new HIVE users...
