By Tristan Olynick, Staff Writer
Over the past year, NFTs (Non-Fungible Tokens) have come into the view of the mainstream media and have come into controversy. The biggest reason why these internet keys have become controversial is because simply, they do not work. Many people believe that these may change the way we use the internet, yet NFTs are stupid technically and ideally.
A big problem is that NFTs are artificially inflated. This inflation comes from the practice that a lot of top tier NFT owners use called “wash trading”. This happens when the owner of an NFT will buy his own NFT with a different crypto wallet. These purchases are traceable through viewing a wallet’s history.
The purpose of wash trading is to artificially drive up the price of these images to an unreasonable number, causing people to think that it’s worth more than it really is. It also puts on the act to potential buyers that it is highly tradeable, causing higher chances for profit returns.
A lot of this wash trading is discovered by places such as “Chainanalysis” which “Connects cryptocurrency transactions to real-world activity.” According to Chainanalysis, there were 25 NFTs discovered under wash trading that made over 8.9 million dollars in ETH (Ethereum) which is an online currency.
A key argument you may have heard thrown around about NFTs changing the game may be in video games, which claim that you can buy an NFT and use it in one game, and then use it in another. A quote from American singer Mike Shinoda, “Imagine taking your favorite skin from Valorant, and using it [in] Fortnite. And not paying extra, because you won it. Then using it in CoD, Minecraft, even Twitter, IG.” This is practically impossible.
On January 9, 3D character artist Xavier Coelho-Kostolny created a thread on twitter explaining why Mike Shinoda’s vision is impractical. When reviewing the thread, one point jumps out clearly. It is irreconcilable to jump from one art style to another; specifically based on rendering technology.
Rendering technology is complicated, there is no same way of rendering things. Many games use vastly different “engines” that drive this rendering for objects, effects, backgrounds, and more in these games. While Valorant renders their game through one engine, Minecraft will render objects in not only a different, but different code. This creates a very important limitation that many seem to overlook.
Due to this change in code and rendering engines, each and every NFT would need to be converted to every single engine imaginable, including ones made by smaller companies which might not even support this conversion. To render an NFT in Valorant you have to give specific instructions and rules to draw this NFT to one’s monitor. Using that same NFT in another game such as Minecraft would break it entirely because they both use completely different sets of instructions to draw objects.
When you look at the server side of things, it gets even worse. If NFTs were to take full effect there would possibly be millions of them. All of them (to even be identified by the platform you are using such as Instagram) would have to be placed on a centralized hub where the platform can pull information from. The platform then needs to spend multiple CPU cycles to verify it is yours and cannot be duplicated, this would slow down server performance immensely rendering them almost useless.
To actually accomplish Shinoda’s dream, Xavier explains that it would cost an unfathomable amount of money with legal issues, conversion work, having to remodel it to fit with the games art style, and performance cost. It simply isn’t worth the work, and many believe it would completely kill the NFT market.