Neosify - Buy, Stake & Earn Crypto
Neosify - Buy, Stake & Earn Crypto
Neosify - Buy, Stake & Earn Crypto
Euro coins - 20 years of initial adoption by 12 EU countries

Nightmares, Failure and Trauma: Getting Real on NFTs

By Crypto Eric | Blockchain Auditor | 16 Dec 2021

When is an NFT not an NFT?

Nonsense Funding Technology

We all know NFTs (non-fungible tokens) are all the rage and people are putting millions of dollars into the rights to "own" or control or get bragging rights to some meme. But when is an NFT an NFT - and when is it not? Is an NFT "whatever we want to call an NFT" that has a special record written to a blockchain? Does it have to be a public blockchain? Can it be a testnet and not the mainnet?

If no one wants it, is it an NFT?

Newts, Frogs and Toads

I have some cryptokitties. No one is offering to throw $50,000,000 at me for one of them. Few people seem to remember those crazy days when the Ethereum blockchain was clogged and slowed down to a crawl, starting with the first kitty, the omega (not the alpha?), Genesis was born on 2017-11-23.  Why aren't those popular? Is it because there are so many of them?

I have various pieces of wearables from different crypto sources. You can see people selling same on and other marketplaces, seemingly the same object for everything from pennies to millions. Does the presence of a virtually unlimited number of the same object reduce the NFT-ness of something?

If you can't find it, is it an NFT?

No find treasures

In the "real" world, we have coin collectors. Let's take a particular kind of coin - the 2 Euro cent coin. There's a ton of new ones minted every year, and each bears a year on it. Next, one side is common across EU members, and the other side has a national design. Most of the time, people ignore these differences - 2 cents is worth 2 cents. To a collector, some of these little coins have values in the hundreds of thousands of Euro. France minted only 9,000 2 cent coins in 2002, making it highly desirable, for example. Coins are highly visible - sitting in your pocket, or wallet, or bureau drawer. NFTs are hiding in some blockchain, made visible to the owner only by a properly set up wallet.

Cardano in conjunction with Wolfram Alpha was giving away "laser eye" NFTs. I know where my tokens are - I have no clue where to find the media (except for the "original" I maintain on my own machine). Is an NFT an NFT when you have the record but no clue where the associated object is?

If it's not on mainnet, is it an NFT?

Next funny token

I have some tokens from a startup organization which asked me to be part of its governance. I say I "have" the tokens, but they are not on the Ethereum mainnet. They are on the Rinkeby Test Network. I have 3 ETH on Rinkeby as well, but that and $5 will get me a cup of coffee. And I attended a conference which offered certificates as proof of attendance - on the Rinkeby testnet. They said I could easily migrate to the main net, if I wanted to pay the gas fees. Not at today's rates, that's for sure.

During the earlier days of the Reddit Moons token, there was no official way to sell your tokens. But clever people found a way to move it - with the Rinkeby network being a stopping off point. So is Rinkeby a place that stores real value, or not?

If it's not on a pubic net, is it an NFT? Fool Us!

Noble Fool's Treasure
No Feigning Teller

I've enjoyed magic since my childhood. I treasure in particular my finger guillotine and my "tree of hearts", and other acquisitions from the magic store so many years ago. So when I heard that the Penn & Teller folks were giving away NFTs, I thought it would be fun. I went to the Chronicle website to sign up and get my freebies. That being done - how can I now see it in Metamask or Exodus or Atomic or Coinbase Wallet? You can't. 

How do I export my NFT to my wallet address or Metamask?

Chronicle’s system is centralised and has been created to introduce traditional users to the world of digital collectibles and NFTs. Therefore all collectibles purchased within Chronicle stay within the Chronicle ecosystem.

So are the governance tokens or the certificates or the Fool Us collectibles NFTs?

So what's an NFT?

Not for trade

So we can say that tokens that comply with ERC721 or its counterparts (BEP-721, Solana's, Cardano's, etc.) are NFTs. But is that helpful? If the token is on a centralized blockchain only accessible through a single vendor, or the object is inaccessible through the obscurity of the chain, or the number of a single object individually tracked is more than the grains of sand on the sea - should they be valued as NFTs?

How do you rate this article?


Blockchain Auditor
Blockchain Auditor

The Blockchain Auditor blog is focused on accounting and audit issues related to blockchain and crypto-assets. There will be content of interest to those with an interest in topics such as accounting for cryptoassets, audit procedures related to blockchain and distributed ledger technologies, blockchain for improving audit processes, taxation of cryptoassets, and trust.

Send a $0.01 microtip in crypto to the author, and earn yourself as you read!

20% to author / 80% to me.
We pay the tips from our rewards pool.