The Dangers NFTs Pose to the Creative Industry

Written by SHARON LOBO

Illustrated by BARRETT SENN

It’s no secret that NFTs have become the latest trend in blockchain technology. If you’re like me, you probably don’t get why people could possibly go crazy over an image on the internet and be willing to pay ridiculous amounts of money for one. I think NFTs are harming more than how we view the value of money; they are harming—and almost mocking—the genuine efforts of those who develop unique, creative bodies of work.

Behind closed doors creative teams spend hours developing graphics, visuals, videos, and more for their brands. Artists work day and night and are often underpaid for their art, and yet they continue to make it—only to have someone named Josh from New York make a couple thousand dollars from a pixelated image that took him 30 minutes to make. Do you see what the problem here is?

A lot of people will argue that NFTs are a digital way of buying and selling fine art, and I won’t lie—they are getting away with this narrative. Let me quickly explain what NFTs are in simple terms: NFTs are non-fungible tokens, which is a unique and non-replaceable code that represents an item you own. NFTs are not exclusively used for visual art, as they can be tied to music or even GIFs. The reason people pay so much for them is to demonstrate ownership and authenticity. By doing this you obtain the right to display the item wherever you’d like, including your digital wallet. You won’t get ownership of the original work if it’s not already yours; you just get the rights for your private use of it.

The phrase ”non-fungible” means that the token cannot be replicated since each token is meant to be unique and one of a kind. Since they’re technically rare and irreplaceable, scarcity is artificially created. This is why NFTs are often valued for such ridiculously high sums of money.

Many will argue that NFTs can actually benefit artists, and there is some truth in this claim. NFTs make it much easier for artists to sell their art in a new global marketplace, and digital art is very much still art. However, a big portion of the NFT market is not necessarily honest and often contributes to art theft. Many artists never know that someone is making profit out of their art because a lot of the buying and selling occurs on the dark web, and it is impossible to gauge where on the internet their art is being sold. No verification is required to tokenize an image, making it easier for artists’ work to be stolen.

It is very easy for NFT collectors and sellers to work around loopholes because NFTs are often difficult to track. This leads to widespread tax evasion as NFTs are not tangible in the physical world. NFTs and other blockchain technology depend on theoretical circumstances and guidelines, but none of it is really accessible to everyday consumers.

The current state of NFTs demonstrates that artistry and economic values are far removed from one another. It is just another ploy for the rich to get richer and for regular people to buy into this new form of capitalism in exchange for symbols of status and wealth. Why else would Twitter create a new feature for setting your NFTs as a profile photo? It is all about elitism and the guaranteed sense of exclusivity tied with it. There is no real value in an NFT until someone offers to pay for it. None of it is based on anything but luck in an unstructured system.

If NFTs want to be ethically revolutionary, there needs to be intellectual property protections, clear guidelines about value, and a way for the technology itself to become more environmentally friendly, as the production of NFTs requires an excessive amount of energy usage. However, it looks like its current form is here to stay unless regulatory measures are introduced.

If you really want to support artists, buy art directly from the source, engage with their work, and boost their platform by sharing what they do. This is the only way to ethically ensure artists are getting the credit they deserve.