NFT. WTF?

Let’s break this down to the individual letters.

F = Fungible. “Fungible” assets are exchangeable for similar items. We can swap the dollars in each other’s pockets or change a $10 bill into two $5 bills without breaking a sweat.

T = Token. Specifically, a cryptographic token validated by the blockchain decentralized database.

N = Non. Duh.

So NFT is a Non-Fungible Token, or in other words, a unique asset that is validated by the blockchain. This solves the real-world problem of vouching for the provenance of that Van Gogh in your attic; in the digital world, the blockchain records changes in the price and ownership, etc. of an asset in a distributed ledger that can’t be hacked. (Just don’t lose your crypto-wallet.)

Early 2021 has seen an explosion in marketplaces for the creation and trading of NFTs. Like most asset bubbles, it’s all tulips until you need to sell and buyers are suddenly scarce.

But I believe NFTs hold the key to unleashing the power of the blockchain for film distribution.

Cathy Hackl of Forbes writes about the future of NFTs:

“Non-fungible tokens are blockchain assets that are designed to not be equal. A movie ticket is an example of a non-fungible token. A movie ticket isn’t a ticket to any movie, anytime. It is for a very specific movie and a very specific time. Ownership NFTs provide blockchain security and convenience, but for a specific asset with a specific value.”

What if there was an NFT marketplace dedicated to streaming films? Filmmakers would mint a series of NFTs and each viewer would redeem one NFT to stream the movie. This would allow for frictionless media dissemination and direct economic compensation to filmmakers.

Here’s a tutorial on turning art in NFTs.

My take: while I think NFTs hold promise in film distribution, the key will be to lower the gas price; the fee paid when creating NFTs in the first place.