It has been the year my prediction from 2017 came true. Four years ago, I described how crypto would enable what I called ‘unique digital assets’. Today, they are known as ‘non-fungible tokens’ or NFTs.
Many people consider NFTs to be gimmicks. They are mistaken.
Humanity is engaged in a collective effort to create a digital version of reality. Why? Well, we have always tried to create alternate realities. And before the latest digital tooling became available to us, we relied on hallucinogens, theme parks, and roleplaying.
But since the birth of the internet, our brightest minds have focused their efforts on digital realities. Chatrooms, online games, and social media are all efforts in this direction.
With the latest tooling available, such as VR headsets, powerful graphics engines, streaming, machine learning etc. our collective project is accelerating. And with each new app, we are advancing towards a more digital reality.
Many people hope that the coming digital reality will be more equitable. I share this hope. However, some people want digital realities with no scarcities. The logic is simple. When code can be replicated endlessly, we can all have things in abundance. A sort of paradise, they surmise.
However, this thinking is flawed. A world without scarcity is not a paradise. It is something closer to hell.
Scarcity is important because scarcity makes us value things. If something is abundant, we assign zero value to it. And a world we assign zero value to sounds far from paradise. Instead, it sounds like an action game with all the cheats turned on. After 5 minutes of rampage, this ceases to be fun.
Even today, some of our most beloved apps have introduced artificial scarcity for the joy and benefits of their users. Pictures that disappear, a limited number of attendees for streams, time-limited access.
However, the current ways of imposing scarcity are crude because they are essentially just ways of “crippling” the apps. They are not true scarcities. In contrast, NFTs enable true scarcity. As true as digital scarcity gets anyway.
NFTs could turn hell into paradise. A digital version of reality. One that feels truly valuable. NFTs enable us to create, trade and collect. Actions that define us as a species and give us immense joy.
We are just at the beginning of NFTs. So early that we call them by name. Soon, we will no longer call them NFTs. They will just be things. Because we will take scarcity for granted. Just like we used to call things “online”. Today, we just assume things are online.
Startups have amble opportunities to speed up this development. All digital assets will be put on blockchains. Just like we have put everything digital on servers.
Many startups helped us get online. Just like many startups will help us get “on-chain”. In the coming year, I hope to bet on more startups doing this.
Happy new year to everyone.