Introduction: At Expensivity, Bernard Fickser explains that a non-fungible token (NFT) is a unique token in cryptography that represents, say, real estate or art rather than money. Because the tokens have unique identities (non-fungible), they can be bought or sold while reducing the risk of fraud.

So how do they work?: The series is called How Non-Fungible Tokens Work: NFTs Explained, Debunked, and Legitimized (July 30, 2021). In Part 4, he looks at the question of what benefits NFTs, in their current state, really confer on you (or don’t):

4 What Just Happened?

The creation and purchase of an NFT as described in the last section raises a lot of interesting — and troubling — questions. It’s easy enough to go with the flow and simply load a crypto wallet with the Ether needed to create or buy an NFT, and then do what you need to get the NFT you want. But NFTs are supposed to impart some sort of ownership, whether it be full possession in a real-world sense or even a partial claim that nonetheless has real traction.

In fact, ownership of NFTs is much more tenuous than such conventional understandings of ownership suggest. I therefore want next to reflect on what the creation and purchase of NFTs as outlined in the last section reveals if we probe beneath the surface. On the surface, a site like Rarible looks like eBay (though not nearly as extensive or sophisticated). But in fact, something very different is going on.

4.1 No Limit on Proliferation, No Guarantee of Scarcity

Equipment for creating a blockchain

If I put up a real physical item for sale at eBay, I can only put up as many items as I actually possess. For instance, if I’ve got three items of the same widget, then I can sell no more than three of them. But with the NFT that I created (i.e., the montage of photos from the Iowa Democratic Primary), I can retokenize it at will and ad nauseam. I can go to Rarible and simply re-upload the png of that montage, pay the service fees, and have it reappear as an NFT. I can keep doing this at Rarible as many times as I like. And so I can put up for sale as an NFT the same png as many times as I want to repeat this exercise.

I can also redo this NFT not as a “single” but as a “multiple” NFT where I specify the number of copies buyers can purchase of it. The analogy here is with a limited edition of baseball cards, where buyers can only buy so many copies until they’re gone. But just as with baseball cards,…