![\"hacker](\"https:\/\/realm10.com\/wp-content\/uploads\/2021\/06\/piracy-1024x684.jpg\")
<\/figure>\n\n\n\nThe truth is, freedom is king in the digital world. <\/p>\n\n\n\n
And as long as this is true, projects to limit the access and sharing of digital assets will face strong opposition. By this, we mean software or music piracy, but also legal movements such as the Free Software Foundation<\/a>.<\/p>\n\n\n\n Of course, intellectual property shouldn\u2019t be copied against the will of the copyright owner, but tools used to restrict the use of copyrighted digital materials shouldn\u2019t go against the rights of the end users either. <\/p>\n\n\n\n That\u2019s where DRM tools usually fail.<\/p>\n\n\n\n And that\u2019s where NFTs shine. <\/p>\n\n\n\n Let\u2019s go back to 2020 for a sec. When was the last time you had heard about a digital artist making 6 figures in an auction? <\/p>\n\n\n\n Never, that\u2019s right. (Well, aside from some Cryptokitties back in 2017-2018<\/a>).<\/p>\n\n\n\n Fast forward to 2021, digital art and collectibles sales are making all the headlines and it seems like everyone wants his piece of the cake. <\/p>\n\n\n\n If this isn\u2019t a digital scarcity success story\u2026<\/p>\n\n\n\n But how did NFTs manage to bring scarcity to the digital world?<\/p>\n\n\n\n Let\u2019s take the example of a digital artwork. In a world without NFT, you\u2019ll have two big problems as a digital artist selling online: <\/p>\n\n\n\n That\u2019s because a digital file is easily duplicable, without any quality loss, but also because there is no way to prove the ownership and authenticity of a digital artwork. Watermarks are easily removable and anyway, nothing really prevents someone from buying your piece and sharing it afterward. <\/p>\n\n\n\n But both issues disappear with NFTs.<\/strong><\/p>\n\n\n\n I won\u2019t explain the full process of NFT minting, but basically, to turn a digital art into NFT and sell it, the digital creator will have to issue his art piece on a blockchain. <\/p>\n\n\n\n To do so, he will:<\/p>\n\n\n\n And bam, just like that, an artist converted his previously easily replicable file into a unique, authenticable digital asset.<\/strong><\/p>\n\n\n\n The digital asset, in this case an image, is tied to a non fungible token stored on the blockchain. That NFT is unique, can\u2019t be copied (it\u2019s unhackable), and gives ownership of the digital asset it\u2019s tied to (it can be stolen, but that\u2019s another topic).<\/p>\n\n\n\n But don\u2019t get me wrong, it\u2019s the NFT that can\u2019t be copied, not the file itself!<\/p>\n\n\n\n This means that if you set your Cryptopunk NFT as a profile picture on Twitter, it doesn’t prevent a stranger from saving the image on his laptop and setting it as his own profile picture.<\/p>\n\n\n\n Instead of forcing digital scarcity by preventing the copy of a digital file the way DRM does, NFTs bring artificial scarcity by making the original file unique and authenticable. <\/p><\/blockquote>\n\n\n\n But then, one question remains: what\u2019s the point for the buyer? How does he prove that he\u2019s the owner of the original file, and not that stranger?<\/p>\n\n\n\n That\u2019s basically what you can say, and prove, when you own an NFT-certified digital asset. <\/p>\n\n\n\n An NFT is like a digitally signed original version of a file. We won\u2019t get into the details, but the NFT is a \u201cpackage\u201d that contains the digital file, but also a bunch of metadata, including the digital signature of the artist\/creator as a proof of authenticity, and all the previous transactions associated with that NFT.<\/p>\n\n\n\n Yes, when most people will compare your Twitter profile picture to the one of that stranger, they won\u2019t see any difference if you\u2019re not there to prove that you own the associated NFT. <\/p>\n\n\n\n However, that \u201cissue\u201d also exist with physical art. And copies don\u2019t make the original physical art piece any less valuable!<\/p>\n<\/div><\/div>\n\n\n\n You have to see it that way: If you own an original Picasso and your neighbor bought a perfect replica of it for a much lesser amount, would you feel bad about it? Probably not, because you know that you own the original and valuable one and that experts will easily make the difference. <\/p>\n\n\n\n Plus, when the time comes to auction off the piece, physical or NFT, it is the original copy owner that will be able to do this. <\/p>\n\n\n\n The scarcity of NFTs then lies in the ability to fully control the monetization of a digital asset, and keep the power in the hands of the token owner. <\/p>\n\n\n\n \u201cWait what, you\u2019ve just said NFTs bring scarcity to the digital world!\u201d<\/p>\n\n\n\n Yes, but I\u2019ve also said that anybody can copy the digital file, as only the NFT tied to the file can\u2019t be copied. <\/p>\n\n\n\n The real question here is how do copies of the original digital file benefit NFTs?<\/p>\n\n\n\n One word: virality.<\/p>\n\n\n\n As we\u2019ve seen with the failures of DRM, the digital world is set to be a world of abundance, where it is the attention of users that is the real scarce good. <\/p>\n\n\n\n And the only way to stand out in that abundance is by chasing virality. <\/p>\n\n\n\n However, before NFTs, even if they managed to reach a viral status, creators still had to fight the constant reproduction of their digital content. Each copy stole the sense of uniqueness and scarcity from the original piece. <\/p>\n\n\n\n For example, Beeple could have generated a buzz with its “Everydays – The First 5000 Days” artwork and get thousands of followers on his Instagram, but how much money could he have made from it? <\/p>\n\n\n\n Certainly not the $69 million he got from his auction at Christie\u2019s…<\/p>\n\n\n\n Now, if artists can mint their creations into NFTs, what happens when their digital art or collectible is retweeted thousands of times, or presented on TV news, multiple videos and has a thousand copies? <\/p>\n\n\n\n Both the creator and the original NFT owner can only thank for the free publicity, as it increases the value of the art piece!<\/p>\n\n\n\n By the way, it\u2019s obvious why the NFT owner would benefit from the increase of value of an art piece, but what does it bring to the creator, aside from fame, you might ask?<\/p>\n\n\n\n Royalties!<\/p>\n\n\n\n Every time an NFT is sold on the secondary market, the NFT creator can earn resale royalties. A great way to generate passive income for the creator!<\/p>\n\n\n\n NFTs and blockchain technology managed to bring scarcity in the digital world by giving value to the original file, rather than by trying to prevent (and prohibit) copying that file. Thanks to NFTs, the original file becomes unique and identifiable amongst millions of copies.<\/p>\n\n\n\n However, as you’ve seen from the examples in this article, NFTs are still quite limited in their applications, as they are mostly used (or at least known) for digital art and collectibles. Plus, some might even say it’s only a craze that will disappear as fast as it appeared in our lives. <\/p>\n\n\n\n But I believe the technology is here to stay and that it will rapidly spread to plenty of digital assets. We’re already seeing NFTs in the music, gaming, and finance industries, but also in the real world with the real estate industry leading the way. <\/p>\n\n\n\nMinting NFTs to create artificial scarcity <\/h2>\n\n\n\n
\u201cMy .jpg is worth more than yours\u201d<\/h2>\n\n\n\n
![\"\"](\"https:\/\/realm10.com\/wp-content\/uploads\/2021\/06\/mona-lisa-copy-1.jpg\")
<\/figure>NFTs embrace abundance<\/h2>\n\n\n\n
![\"graffiti](\"https:\/\/realm10.com\/wp-content\/uploads\/2021\/06\/virality.jpg\")
<\/figure>\n\n\n\nWhat’s next?<\/h2>\n\n\n\n