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Non-fungible fundamentals

March 27, 2023

Is a non-fungible token fungible if it's in two different places? I don't know and I don't care.

Milt Policzer

By Milt Policzer

Courthouse News columnist; racehorse owner and breeder; one of those guys who always got picked last.

This may explain why I’m not wealthy, but I truly believe non-fungible tokens are just plain silly. You might as well be investing in air.

Not even the people who profit from NFTs can do it with a straight face. There’s a guy who’s made millions trading them who calls himself “Sillytuna” on Twitter. Why would someone voluntarily hand over huge sums of money to a Sillytuna for a chunk of blockchain that can’t be used for anything?

You can’t even hang an NFT on your wall.

If you want your mind blown by this topic, check out a ruling from a federal magistrate in New York dismissing a lawsuit over the auction of “the first non-fungible token ever created.”

The discussion of the claims by the plaintiff goes on at some length but here’s the main takeaway: NFT values — and their very existence — are a philosophical issue.

A guy named Kevin McCoy created something called Quantum — which you can look at for free on the internet — and then turned it into an NFT on a blockchain called Namecoin. Seven years later, McCoy recorded the NFT on the Ethereum blockchain because, I guess, that’s a cooler chain or maybe works better.

(Jennifer and Kevin McCoy via Courthouse News)

In swoops the plaintiff, Free Holdings Inc., and claims the domain name that the NFT had on Namecoin. The newly addressed NFT is sold by McCoy for $1,472,000 to Sillytuna, aka Alex Amsel, who claims he’s just bought the first-ever NFT.

Not so, says Freehold. The Etherium NFT is a new one, not the first, so the claim damages Freehold’s Namecoin domain blockchain value.

I’ll spare you further details — I feel a headache coming on — except to say the judge here explains there are three NFT theories — either the token remains the same when registered on a new blockchain; a new token is created by the change, leaving the old one in place separately; or the reregistered token is both new and represents the coin at the old address.

Quantum physics, anyone?

Take a break now to swallow the painkiller of your choice.

I’d rather invest in Schrodinger’s cat.

Limited time offer. Since value is created by scarcity and uniqueness, I’d like to offer myself — there’s only one of me — for sale for a mere $10.2 million.

Your ownership of me does not prevent use of me by myself or others and does not extend to a new me created when I move to a new address.

Ownership of the old address me will not be affected.

Side gig? Here are two sentences I didn’t expect to see following each other. These are from a recent New York federal judge’s ruling:

“Plaintiff is a licensed attorney in Massachusetts. From March 27 to May 15, 2020, Plaintiff was employed by Amazon as a ‘Seasonal Amazon Shopper.’”

Apparently the attorney thing wasn’t working out.

OK, I do realize a lot of lawyers struggle to make ends meet and need side gigs. What’s really weird about this is that Amazon hired the guy. If you hire a lawyer for something other than lawyering, you have to know you can end up being sued.

Think about the scorpion and the frog.

There are a couple of lessons to be learned here for both lawyers and employers.

Lawyers: Don’t sue people who hire you. Resist the temptation. No one will hire lawyers if you keep doing this.

Employers: You probably shouldn’t hire lawyers.

Categories: Op-Ed

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