It's that time of year once again, where families gather around the table, break bread together, and inevitably argue across the wide gaps of generational understanding and discuss the complexities of the interconnected world we live in.

One dish surely on the table this year is the parabolic rise of NFTs. It is certainly a challenge to engage in these conversations with skeptics, so here below I have gathered points that have helped me convert many a doubter to the vast potential of blockchain technologies. I hope you may find these points useful in your battle to convince your grandparents, aunts and uncles that you aren't absolutely batshit crazy.

Special thanks to Cath Simard for this generous serving of her Cryptodickbutt for our illustrative purposes. Let's dive in, and please share this post if you find it useful :)

NFTs are a capture mechanism for cultural capital.

Why do we value the things we value? Because there is a community consensus that certain objects or ideas are an integral part of our shared experience and the story of humanity. Historically, this has been analog things- paintings, books, music, artifacts, heirlooms. They are objects that represent ideas we value, and this tendency is so ingrained in us that we never question it. So why do so many question this in digital spaces? It’s because

NFTs are the first time we have digital objects.

This tech is relatively in its infancy, most people have never encountered it or interacted with it. Blockchain technology enables digital originals. Prior to NFTs, everything on the internet was a copy of a copy of a copy. That is the world we are acclimated to. But now, by tokenizing the original representation of an artwork, all subsequent copies are advertisements for the original. To understand why NFTs are going parabolic right now, one must ask-

Where do the majority of your social interactions take place?

Increasingly, our social interactions are taking place in online environments. We now have an extremely robust social experience online, which was accelerated by the lockdowns of the recent pandemic. Your meetings, your interactions with friends and family, your shopping, your consumption of culture and media- all of these things flow through our interconnected networks online.

Not convinced? Check your screen time on your phone. How much time are you spending in digital spaces per day? Subtract the time you are sleeping, and think about the percentage of your waking hours that you engage in our online social sphere.

But why are these NFTs valued so highly? Isn’t everything on the internet free?

No! Everything on the internet costs money. Web2 companies are worth hundreds of billions of dollars (over a trillion combined) because they have capitalized on the value of community and content when paired with advertising, and they sell YOUR data to the highest bidder.

NFTs and Web3 technologies are a response to that centralized system and an effort to reclaim sovereignty over personal data . In Web2, users get little or ZERO percent of that revenue they generate. Web3 represents the users of systems and protocols sharing equity in the value they generate by using those systems. That is a fundamental shift for creatives in online spaces, and it is nothing short of profound.

Ownership is different from viewing / experiencing something.

But I can right click save the image! It’s mine now!

This is a fundamental misunderstanding of the entire concept of ownership. Ownership is custody of an asset- control of where it is, what it is valued at, and the ability to transfer that asset or exchange it for other assets. You don’t own a movie when you buy a ticket to the theatre. You don’t own the Mona Lisa when you take a photograph of it. You don’t own an NFT if you screenshot it, because you have no control or custody over the original asset.

In fact, the more you copy an original, the more an image is seen, the more it is embedded into our collective cultural narrative, and the more value accrues around the original asset. This is the underlying strategy of all advertising- embedding ideas into our collective consciousness, in order to increase the value of those products and ideas.

Blockchain tech allows for frictionless exchanges of value.

High value transactions in the “real world” are extremely high friction. This is true for large sums of money, but even more so for high value artworks, property, real estate, and other assets. There are many layers of interference, slow systems, and lumbering bureaucracies.

On blockchain, these transactions can happen nearly instantaneously. Add up all the time, effort, and stress saved and it means these markets move at the speed of light compared to traditional financial systems. Thus, they evolve faster, innovate more, and provide value propositions that could never be seen in the slow moving markets of the meatspace. But better yet-

Blockchain allows peer-to-peer exchanges with no middle manning.

A wallet allows you to have sole custody of online assets like NFTs and crypto assets. You need not go through a bank, a gallery, a dealer, a consultant, an agency, or any of the layers of traditional exchanges- each which skim profits from the process of helping you make those exchanges. This is the promise of self sovereignty, of decentralization- we are decoupling ourselves from centralized systems that have parasitic business models, siphoning more and more value from the communities they “serve.”

It’s still so early!

This is said so much in this space that it’s nearly a meme itself- but it’s also true. The systems we have now are still a far cry from where we hope to take this technology, but it is a giant step in the right direction. Just as Web2 was a step towards the decentralization of media- this new era is just another stepping stone over turbulent waters. The joy of this space is that it is so early that we all get to play a role in how it unfolds. I’ve never had so much fun online in my life, and it’s why I encourage everyone to learn more about what is happening here so they can experience the same excitement we feel in every GM.

I hope this brief writeup can provide some conversation starters and talking points as you inevitably encounter the right-click-savers in your family and friend groups.

Warm regards, and a hearty WAGMI,

Dave Krugman