Non-fungible tokens (NFTs) are supposedly the future of … well, everything. We’re told they’ll completely revolutionize how we buy and sell art, creating an entirely new ownership model and fundamentally changing the digital economy. Better yet, the blockchain technology that acts as their foundation is supposedly the holy grail of cybersecurity.
There’s just one problem—none of that is actually true. While blockchain is broadly applicable to transactional security, NFTs are both overhyped and oversold. They’re bad for the artistic community, bad for the tech industry, bad for the environment, and ultimately, without either value or merit.
To explain why that is the case, we’ll first need to explain precisely what an NFT is.
What Are NFTs?
To hear proponents of NFT technology talk, each NFT is a completely unique, uncompromisable digital identifier. A perfect proof of ownership for everything from artwork to apps. Per retired computer scientist Antsstyle, this is abjectly false for several reasons:
- An NFT does not prove ownership. An artist who sells NFT artwork still holds the original copyright unless that sale also includes a contract establishing a transfer of ownership—rendering the NFT irrelevant.
- NFTs do not have any direct connection to any other assets. What you are purchasing when you purchase an NFT is a single spot in a blockchain ledger. Attached media is simply a visual representation of that spot.
- NFTs have no tangible value—their value is purely speculative, driven by the people who invest in them.
- Like most crypto, the mining process that creates additional NFTs is extremely harmful to the environment, while also contributing heavily to an ongoing chip shortage.
- Blockchain is no more or less secure than any other system, and in fact, suffers from several of its own crippling security issues.
A Fundamentally Broken Technology
NFTs, in other words, are little more than a virtual Ponzi scheme. The only people that promote them are those who have something to gain, and those who don’t understand how they work. Even their supposed claim to fame—that they cannot be modified—is false.
Purchasing an NFT is functionally akin to buying someone else’s grocery receipt and saying that makes them entitled to your items. It’s like buying the exclusive rights to stand on a particular square of concrete next to a painting, and believing that makes you the owner of said painting. However, both of these analogies touch on what is quite possibly the biggest problem with NFTs.
Simply put, they are incapable of proving absolute ownership of an item. There’s a reason legal contracts are subject to so many rules and regulations. And even those contracts can feasibly be challenged in a court of law.
“Proof of transaction does not equal proof of validity,” writes Antsstyle. “An NFT can’t be trusted on its own terms; you must check with the artist that it was sold by them, just as you would need to do with a legal contract or anything else. This makes its use as a “proof of ownership” completely useless; it does nothing a legal contract can’t do.”
NFTs Aren’t the Future of Anything
So, to summarize, NFTs:
- Have no intrinsic value.
- Are actively harmful to the environment.
- Do not demonstrably prove ownership.
- Are extremely resource-intensive.
- Contribute to an economy of theft and gift, with scammers and bots stealing and reselling artwork they have no legal right to.
- Are predicated on the false idea that blockchain is inherently secure.
In short, NFTs have no application in cybersecurity, nor any other field. The current obsession with NFTs is a pastiche of the early 90s dotcom bubble. And we all remember how that ended.