Judeumeh's Blog

This is last in a series of posts to share some observations, opinions and conclusions on this intriguing technology which sits squarely at the intersection of digital, creativity and intellectual property. The topic is broken down into the following parts:

1. What are NFTs (and the non-fungibility superpower)?
2. What has this got to do with Intellectual Property (and content protection)?
3. Does it mean that NFTs are like DRM remixed?
4. How does it affect the creative industry today and in the future?
5. Summary observations and conclusions.

My previous post discussed some of the impact that NFTs have had, and will likely continue to have, on the creative industry. In this last part, I’ll wrap up the outcome of my limited foray into this topic as follows:

5 – Summary Observation and Conclusions

1. We’re still in peak hype cycle – despite the noise and publicity, only a small percentage of the population are actively involved in NFTs or Crypto. We are in definitely in peak hype cycle and exuberance such that any swing down the trough of disillusionment will be truly epic. For starters, it is well worth keeping an eye on cross chain compatibility efforts and regulatory compliance and interventions.
2. Freakish fees and climate challenges –  this is particularly vexing for NFTs on the Ethereum blockchain because of the extremely volatile and unpredictable gas fees which can exceed sometimes the cost of the NFT! This is compounded further by the fact that proof of work blockchains, such as Ethereum or Bitcoin, consume vast amounts of energy to power their growing transaction volumes.
3. Tech and UX woes – Although things have come a long way since I first ventured into the crypto-bitcoin continuum, circa 2013-2014,  the technology is still less than intuitive, user experience is iffy at best, and processes are too fluid. People want to explore NFTs but don’t know where to start as it’s too technical for most to easily navigate setting up wallets or transacting meaningfully with cryptos, DeFi and NFT marketplaces. The user experience has a long way to go to achieve the straightforward ease of doing a simple ecommerce transaction on Amazon. This will be critical for true mass adoption to kick in.
4. Show me the money, and the #FOMO effect – The world of crypto is sometimes perceived as rife with crime, scams and skullduggery; a place where tales of pure mischief abound such that it’s almost a badge of honour to be scammed as you dip your toes in the water. When coupled with extreme speed of evolution, you might be left feeling that daily contact is mandatory to avoid the much dreaded #FOMO. Finally, it is far too easy to make costly mistakes such as sending crypto to the wrong address, (e.g. sending bitcoin to a bitcoin cash address), which can result in irretrievable loss of your crypto.
5. Centralisation vs. Decentralisation – It may come across that decentralisation is the answer to everything and even questions yet unasked, but that is far from the case. I believe there is space, even necessity, for both to co-exist and co-evolve together. This is the way!
6. NFTs != underlying asset – As mentioned previously, buying an NFT does not necessarily mean you’ve bought the underlying item to which it points.  Also, there is no guarantee that the item in question may not be altered, deleted or otherwise tampered with by the hosting operator. 
7. NFT vs. Copyright – It is important to note that although NFTs  and blockchain based systems may look like suitable candidates for an all sweeping digital IP platform, but we have yet to surmount the same issues that plagued the likes of DRM technology in the last century. Even then we saw that technology itself was not the problem, rather its dependence on human fuzziness and contextual interpretation makes this too wicked a problem to solve easily.

In summary, it is clear that blockchain based NFT is not a be-all-end-all solution –  One common mistake is to ascribe inflated expectations, capabilities and impact to emerging tech / use cases. The reality is that it usually takes a combination of certain key ingredients to realise the breadth and scale of change such wishful thinking  espouses.

The last page of my 2007 book on DRM has a list of these key capabilities which still stand true even today, i.e.:

• Ubiquituous connectivity and storage – e.g. cloud computing with SaaS, PaaS and IaaS
• Business model and rights management – business logic and information rights management
• Artificial Intelligence – e.g. enhanced Smart Contracts with Machine Learning, NLP, Vision and Robotics
• Identity and Trust – e.g. powered by blockchain based solutions
• Community and Social Networking – powered by human interactions and connections

In conclusion, it is doubtful that NFTs alone can become the single, major IP and content protection platform. However, it is well-positioned to deliver a major piece of this wicked puzzle with its underlying blockchain-based capabilities for trust, provenance and smart-contract based programmability – and that is exciting!

Disclaimer: The opinions expressed in this post are mine alone, and do not reflect those of my employer or professional affiliations in any way, shape or form. Secondly, it does not constitute any legal, financial, spiritual or otherwise professional advice, and I do not claim any specific expertise on these topics. Furthermore, I believe, we’re still very early into these particular digital technologies and their fast emerging use cases, therefore it is always advisable to proceed with caution. 

Pls. Note: As part of my education, research, and experimentation, I purchased a couple of NFTs and even minted a few pieces on OpenSea, (the above NFT image is based on an early draft of this article). It is used here for illustration and critique purposes only.