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Non-fungible tokens
Non-fungible tokens (NFTs) are a rapidly emerging technology that sits at the intersection of cryptocurrency, digital ownership and preservation. These trendlines are of particular importance to libraries, which often work collaboratively with their communities to share and preserve intellectual property. This column will define what an NFT is, explore the relevant trends impacting its development and examine how it intersects with the traditional roles of the library.
What is non-fungible token? Part I: Non-fungible
One explanation of NFTs is fairly straightforward: they are digital objects usually built off existing properties that are designed to be non-fungible. That is, NTFs can be given or sold to another person like an original copy of a panting. Each NFT is a unique digital object that cannot be replaced by another. The internet is a technology that dramatically reduces the barrier to mass distribution. This has resulted in digital objects that are easily copied and shared, reaching a massive potential audience. It also has resulted in digital objects that are often interchangeable. Even cryptocurrencies, which we will discuss later, is fungible in the sense that they have obvious value. One bitcoin can be exchanged for another bitcoin, and each will be identical to each other. Because many people have created digital objects that they would like to be able to sell it to a single individual rather than monetizing its distribution, this creates a new opportunity. With the advent of blockchain technology, it has become technically plausible to create digital objects that are non-fungible, resulting in NFTs.
To really understand NFTs, it can be helpful to examine a few specific examples. The 2007 viral video “Charlie bit my finger” was sold as an NFT for $760,000, funding the brothers’ college aspirations. As part of the sale, the video will be removed from YouTube. The first tweet ever sent by Twitter’s Chief executive officer (CEO), Jack Dorsey, recently sold for $2.9m (Locke, 2021). In this case, the tweet will remain on Twitter for everyone to view. A collage of digital art titled “Everydays - the First 5,000 Days” was auctioned off by the prestigious auction house, Christie’s, for $69m. The artist will retain the copyright to the images that make up the collage, which are available on their...