NFT's and Beanie Babies, interesting article

[bnorth]

Originally Posted by Rhotchkiss

I think some NFTs make sense, even a lot of sense. I think NFTs are similar to trade marks or copywrites, which are hardly novel. Trade Mark is defined as "A name, symbol, or other device used to identify and promote a product or service, especially an officially registered name or symbol that is thereby protected against use by others." A trade mark is an ownership interest in an intangible item, and it has value -- the Nike Swoosh, Tony the Tiger, the McDonalds Arch, etc. There is no inherent value in the Nike Swoosh, and it can be seen everywhere and be reproduced easily, but that sucker is a worth a buttload!

A copywrite is defined as "the exclusive legal right to reproduce, publish, sell, or distribute the matter and form of something (such as a literary, musical, or artistic work)". You can hear Hey Jude by the Beatles all over the radio. You can sing it yourself and learn it on the guitar. Yet someone owns the rights to that song and can license it and make real money. Plus, there is substantial value in owning the rights to Hey Jude

To me, NFTs are the "tangible" property version of a trade mark or copywrite. Take, for example, NFTs that are artwork or symbols. These make sense to me and I understand why they could have value. For example, you can see the image of Starry Night by Van Gogh everywhere and there are a zillion reproductions/copies. Yet there is only one original Starry Night by Van Gogh, and that original is priceless. Thus, if an artwork NFT was ever to gain huge popularity, I think having the original/the only actual would be very valuable, both in its own right and for licensing purposes.

Suppose someone created an NFT that served as the symbol for the BLM movement or the LBGQ rainbow. Even though the symbol is used everywhere and can be recreated easily, having the original/the actual NFT would have real value.

Thus, I understand this aspect of NFTs and why/how they can have value. THAT SAID, here is what I think does not make sense with NFTs:

1. They are relatively easy to make and there are so many of them being made. I dont know the percentage, but I would guess that less than 0.01% of all original artwork being produced today will be worth in a year (let alone 10 years) what it sells for in a gallery today; indeed, it may be relatively worthless. I fear there are so many NFTs out there, and more being made all the time, that everyone is rushing to own one (or more) and nobody will eventually care about a monkey with a blue beanie, just as nobody cares about another landscape painted in oil. Some NFTs will have major value, but I think it will be a very small percent and who knows which ones that will be.

2. I totally do not understand the plays/video clips. You are not going to license a block by Zion and you can find it all over the internet and who cares, let alone understands, that you "own" that video clip. To me, this is not like digital art or a symbol. I do not understand them

NTFs limited like modern shiny cards makes sense to me in the high end watch market. Some are insanely rare and the owners don't openly post pictures. I know it is being discussed and hopefully it happens. There are watches I would buy NTFs of.

[Rhotchkiss]

Bob, I think thats a reasonable comparison. Or, consider original negative of a very famous photo. Imagine you had the negative of Ruth bowing out in his last game. The actual negative. You could make a millions pics off it, but there is only one negative. I think thats what an NFT is like, except its not tangible, its digital. But you can take it to another level - I can produce 20 photos from the negative, label them 1-20 and then destroy the negative or somehow retire it so more pics can be made. You can do this with an NFT too - make a limited edition/run, 1 of 20 of the same thing. Or, you can make some dumb monkey with 85 different hats on and sell each one of those hat-monkeys as an NFT that is part of the larger monkey-hat run. I am not saying this is a good buy, but only trying to explain, in somewhat "earthly" terms, what I think an NFT is.

And, as the owner, I think you would be able to bring actions against people who used your NFT without licensing it/permission; just like if someone used my painting or song in a commercial or movie.

[maniac_73]

Originally Posted by Rhotchkiss

Bob, I think thats a reasonable comparison. Or, consider original negative of a very famous photo. Imagine you had the negative of Ruth bowing out in his last game. The actual negative. You could make a millions pics off it, but there is only one negative. I think thats what an NFT is like, except its not tangible, its digital. But you can take it to another level - I can produce 20 photos from the negative, label them 1-20 and then destroy the negative or somehow retire it so more pics can be made. You can do this with an NFT too - make a limited edition/run, 1 of 20 of the same thing. Or, you can make some dumb monkey with 85 different hats on and sell each one of those hat-monkeys as an NFT that is part of the larger monkey-hat run. I am not saying this is a good buy, but only trying to explain, in somewhat "earthly" terms, what I think an NFT is.

And, as the owner, I think you would be able to bring actions against people who used your NFT without licensing it/permission; just like if someone used my painting or song in a commercial or movie.

I agree that there is value in having the original. The issue with NFT’s is that ppl think they own the jpeg or video which isn’t actually true. The NFT is stored on a server somewhere and the address is stored on the blockchain in a smart contract which is what you actually buy. If the server crashed or shutdown or the file is deleted/moved then your nft is gone. All you are buying is a number that points to a server somewhere that tells you what resides there.


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[BobC]

Originally Posted by maniac_73

I agree that there is value in having the original. The issue with NFT’s is that ppl think they own the jpeg or video which isn’t actually true. The NFT is stored on a server somewhere and the address is stored on the blockchain in a smart contract which is what you actually buy. If the server crashed or shutdown or the file is deleted/moved then your nft is gone. All you are buying is a number that points to a server somewhere that tells you what resides there.


Sent from my iPad using Tapatalk

Very good point, and one of my issues and reasons for asking what do you actually own, and what are your legal rights, in regards to such ownership. Here's where my business experience, auditor's background, and professional skepticism starts screaming. As you said, the NFT is actually stored on a server somewhere, and can have all the bad things happened as you described. So........

First off, if I pay some ridiculous amount of money for an NFT, why can't I have it moved and stored on a server I own and/control, or can I? And even if I do have it moved, how can I be sure that the NFT from the original server was not somehow copied and saved on that original server, or elsewhere? I guess I would simply have to take someone's word for it, right? Unlike buying say a T205 Addie Joss card and knowing I, and I alone have it, as I actually hold the card in my hand when delivered.

Secondly, if I can't have it moved, I'm sure I'll be told not to worry, computer technology and safeties are in place so I shouldn't ever have any fears or concerns when it comes to my NFT, and reports, documents or verifications I need to feel safe and secure are available from whoever does own/control the server my NFT is stored in. Yeah, just like people that invested with Bernie Madoff or owned stock in Enron could count on those computer generated reports and data to give them that warm and fuzzy feeling that their records and investments were safe and secure. And those were in industries that are highly regulated and subject to specific governmental department (SEC) oversight.

And thirdly, continuing from my last comment, many people would likely argue and say NFTs aren't really all that different from investing in the stock market. You own an intangible interest in something you never really physically see, own, or touch, and record keeping of your ownership is electronically maintained by massive companies and their computer systems, and Wall Street in general. But the entire system and industry is subject to relentless scrutiny and oversight by the government, specifically the SEC, along with other independent groups and watchdogs, like independent CPAs. And who, or what part of the government, is watching over these NFTs and this entirely new digital market, that suddenly arose seemingly out of nowhere, to make sure that people buying into it aren't getting taken advantage of or ripped off? Exactly!!!

Already mentioned the physical advantage of owning and being able to hold and control a T205 Joss card versus owning an NFT. So fourthly, I can also call an insurance company to show and send them a picture of my Joss card, and have it insured for theft, loss, damage, and so on. Can you do that with an NFT, especially if it is not stored on a server you own or control? And assuming an insurance company did agree to cover your NFT, exactly how would that insurance company value it, and possibly pay off on such a claim if say your 1/1 NFT of Gronk doing something idiotic at a party, that you stupidly paid.........errrrrr, smartly invested $50,000 for, was somehow suddenly erased from the server it was on? Especially when a claims agent can probably just go online and literally find hundreds of images of Gronk acting like an idiot, and simply ask you how many different images of him being an idiot would you like him/her to download and send to you to replace the one you lost. Or maybe even worse for you, the claims agent goes online and finds a copy of the exact image you lost, and simply downloads and emails it to you, along with a simple message, "Claim Closed!". Regardless, not sure why an insurer would agree to just give what you willingly paid someone else for it, especially if you haven't been able to use the NFT to generate income to file a loss of revenue type of claim for, or show there is an established secondary market, and therefore, a discernible value to be able to determine for it. At least that's maybe one more advantage I can see for physically owning a T205 Joss card, ease in getting it insured by a reputable insurance company.

I'm concerned these NFTs may eventually turn out to be a lot like all the GU cards they started producing back in the '90s. They started out as something new, real popular, and somewhat valuable, so the card companies kept churning more and more of them out for the same players over and over again. It has gotten to the point where if you go to a show, you'll see dealers with boxes of old game used cards they can't seem to give away today. So what's to stop that from happening with all the GU and limited edition cards they're still turning out for all the current player's eventually? There will always a few such cards that will retain their value, and possibly appreciate some over time. But I think that will mostly be limited to some of the very elite players, especially in regards to older players like Cobb, Ruth, or Wagner. In regards to GU cards, players like those truly have a very limited number of verified GU bats and jerseys that can be acquired and used by the card companies. True rarities because only a few have survived till today. Nothing like the manufactured rarities the modern card companies keep spitting out day after day now. And I can see a possible course like this for NFTs, and the people currently producing and selling them. The smart ones are probably those jumping on the bandwagon to sell NFTs now, before they become overdone and saturate the market and people begin losing interest, or maybe the next big thing comes along to start replacing them. Like perhaps three dimensional holographic NFTs. Who knows, these current NFTs could turn out to be the next Betamax.

[Ronnie73]

Beanie Babies bring back a lot of memories. I remember at one point, baseball cards shows also included Beanie Baby dealers. I'll never forget the time when McDonald's was giving out mini versions each week and locations were running out of them after the first couple days. My girlfriend at the time had me driving to every McDonald's within a 200 mile radius. Then we'd sell them for $20 each. I still have a large comicbook box of them, along with other random regular issues.

[BobC]

Originally Posted by Rhotchkiss

Bob, I think thats a reasonable comparison. Or, consider original negative of a very famous photo. Imagine you had the negative of Ruth bowing out in his last game. The actual negative. You could make a millions pics off it, but there is only one negative. I think thats what an NFT is like, except its not tangible, its digital. But you can take it to another level - I can produce 20 photos from the negative, label them 1-20 and then destroy the negative or somehow retire it so more pics can be made. You can do this with an NFT too - make a limited edition/run, 1 of 20 of the same thing. Or, you can make some dumb monkey with 85 different hats on and sell each one of those hat-monkeys as an NFT that is part of the larger monkey-hat run. I am not saying this is a good buy, but only trying to explain, in somewhat "earthly" terms, what I think an NFT is.

And, as the owner, I think you would be able to bring actions against people who used your NFT without licensing it/permission; just like if someone used my painting or song in a commercial or movie.

Okay Ryan, I think we're on the same page then in understanding these NFTs, and still not sure why people are willing to pay so much for them. As you said, these are digital images, not something tangible. So one digital image is exactly the same as every other similar one out there, unlike say a work of art where the artist also puts out a limited edition number of prints of that piece. Those prints will never be exactly the same as the original painting, and you can always tell the original from a print. Not so sure that is the case with an NFT digital image. Guess it is a lot of the old fart in me that has a hard time valuing such non-tangible items so highly, because once that digital image gets out there for all to see, copy, and forward, its out there. You won't be physically able to know of and sue everyone who now may have a copy of it as well.

That's why I alluded to an NFT as maybe like the first ever '52 Topps Mantle card to be made. You don't have the only one, just the first one. So the value is in the bragging rights of saying you have the first one. But with these digital images, exact copies can be quickly and easily made, and then forwarded to a huge, ever expanding, number of people. Not the same as owning the negative and then making prints one by one, or having someone then try making a copy from one of the prints, that will never come out as good as a print made from the original negative.

I guess I'll never understand the younger generations and what they see in all these new things. Maybe that's the main problem with the world in general, things are changing too fast and too quickly. Just thinking back to when I was born in the '50s, and all the technological advances and discoveries that have occurred during my life up to now, it almost literally dwarfs all of mankind's combined previous advances and discoveries up till then. Just look how the hobby itself has changed in the last 30-40 years, and the further unknown changes coming with the Fanatic's dealings, things like these NFTs, and God knows what else. As a former colleague of mine and I always used to say to each other, "I'm getting too old for this sh#t!"

[Exhibitman]

The value of a copyright, patent or trademark on a digital image is the right to use it and sell the right to use it. If the NFT came with the copyright so you could license it then it would have some independent value. But as they stand now, they do not, so the comparison with other forms of intellectual property is inapposite.

[BobC]

Originally Posted by Exhibitman

The value of a copyright, patent or trademark on a digital image is the right to use it and sell the right to use it. If the NFT came with the copyright so you could license it then it would have some independent value. But as they stand now, they do not, so the comparison with other forms of intellectual property is inapposite.

And that is one of the reasons I can't fathom why people would be paying so much for these NFTs. Is it possible that some people actually feel they'll be able too generate some future income from an NFT? If that turns out not to be true, a lot of people may be in for a rude awakening.

[swarmee]

Originally Posted by BobC

And that is one of the reasons I can't fathom why people would be paying so much for these NFTs. Is it possible that some people actually feel they'll be able too generate some future income from an NFT? If that turns out to be true, a lot of people may be in for a rude awakening.

Well, greater fools theory is a thing. Plus some NFTs have embedded into the code information about the original owner, and every time it sells, a portion of the sale price is sent back to the creator's wallet. And some NFTs have the ability to be moved off one site (original purchase location) into a digital wallet somewhere else, to be sold on a different exchange or just stored there in case of crash/theft. TopShot minted their "moments" with the availability that they could be moved off-site, however Panini's original blockchain was more like an Excel spreadsheet with tracking and all transactions needed to stay there (so Panini gets a recurring cut of every sale).

[BobC]

Originally Posted by swarmee

Well, greater fools theory is a thing. Plus some NFTs have embedded into the code information about the original owner, and every time it sells, a portion of the sale price is sent back to the creator's wallet. And some NFTs have the ability to be moved off one site (original purchase location) into a digital wallet somewhere else, to be sold on a different exchange or just stored there in case of crash/theft. TopShot minted their "moments" with the availability that they could be moved off-site, however Panini's original blockchain was more like an Excel spreadsheet with tracking and all transactions needed to stay there (so Panini gets a recurring cut of every sale).

I hear you.

[Snapolit1]

Too funny.

[Rhotchkiss]

Originally Posted by Exhibitman

The value of a copyright, patent or trademark on a digital image is the right to use it and sell the right to use it. If the NFT came with the copyright so you could license it then it would have some independent value. But as they stand now, they do not, so the comparison with other forms of intellectual property is inapposite.

A painting does not come with a copyright. Nor do many other types of intellectual property, yet the owner has rights to enforce its non-use and to license its use. I don’t want to get into a legal debate.

Regardless, the analogy is not perfect, but as mentioned, I am trying to explain it to “earth people”, like Bob (and me), for whom the concept of an NFT can be tough to grasp. And this analogy, while not perfect, is plenty close enough for that purpose

[lowpopper]

I was contacted to contribute to this article. I feel beanie babies will have a resurgence in some shape or form

[Exhibitman]

Originally Posted by Rhotchkiss

A painting does not come with a copyright. Nor do many other types of intellectual property, yet the owner has rights to enforce its non-use and to license its use.

Actually, all creative works have an automatic copyright, called a common law copyright, but to qualify for the draconian protections of the Federal law you have to register the work in DC. Otherwise, you literally do not have the right to exploit the painting, unless the artist has sold you the copyright, it has passed into the public domain, or the use you want to make of it constitutes a fair use of the painting. You may be thinking about an artist's right to produce an image with independent artistic merit of an otherwise copyrighted item (like Warhol's Campbell's soup cans), but you do not have the right to simply take a picture of a card and produce reprints or license others to create reprint cards. Here is a fun read on the subject of a sexualized Barbie parody:

https://www.rcfp.org/artistic-photos...ate-copyright/

The Copyright Act limits the rights of a copyright owner regarding works that build upon, reinterpret, and reconceive existing works. ... The factors are "to be explored, and the results weighed together, in light of the purposes of copyright." Id. at 578, 114 S.Ct. 1164. Depending on the particular facts, some factors may weigh more heavily than others. Id. at 577-79, 114 S.Ct. 1164. The four factors we consider are: (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work. Dr. Seuss, 109 F.3d at 1399-1404 (analyzing and applying 17 U.S.C. § 107)."

Mattel Inc. v. Walking Mountain Productions, 353 F.3d 792 (2003)

[Gary Dunaier]

94-Piece Jumbo Beanie Baby Set - a special offer from the Beanie Babies Showroom, with your hosts Don West and Robert Chambers