What the hell are NFT's? Part 1

Gentlemen welcome m josh drive  and in this video m going to explain the NFT craze in the simplest way  possibly won't be going into super deep technical depth such as gas fees or residual taxation instead  want to explain the basic concept using relatable real-world scenarios you can finally wrap your head around something which is honestly very confusing ll try to explain everything from the inception of the NFT idea to why the art connected to them is so strange to why people keep saying things like NFTS games or metaverse before we start a massive thank you to the supporters on  and twitch who keep this channel alive more on how you can support at the end for now let's begin with 2.7 million NFTS in existence and that number increasing daily the NFT boom is definitely here but with only 360 000 people actually owning any it seems to be a very exclusive club nearly 300 million people in the world are actively involved in cryptocurrency this means only 0.1 percent of cryptocurrency users are also involved in NFTS so what is this super exclusive club all about and why is  let's start at the very beginning imagine wanted to sell you nothing that would be great for 'd get money you'd get well nothing how could do this ask you if you want to buy nothing you say no and rightfully suck because people don't  what people like is status or rarity now in a digital world scarcity is a strange concept because everything digital is just ones and zeros you can recreate data as much as you need but what if  created artificial digital scarcity data which could not be recreated or reproduced imagine create a database with a limited number of spaces in it each space identified with a unique number it can help to visualize this as a long queue of people a line with places for people to stand the queue doesn't go anywhere and there's no inherent value to be standing in one spot over any other spot it's there and  sell people a position on this queue let's say there are 9999 places in the queue and  sell you the right to stand in a place for one pound it's important to understand 'm not selling you the entire queue or the experience at the end of it because there is none m not selling you the land you're standing on what m selling you is the right to stand there and to say this is your cue position might even give you a bit of paper which reads josh drive  hereby declares the bearer of this paper can stand in this cue position and then  sign it so no one else can make this exact bit of paper your position in the queue or the paper which states your position is a token it cannot be recreated it is means to be replaced by another identical item and because you cannot have another q position 1 it cannot be replaced when you buy a position in the queue absolutely nobody else can buy that position and to make sure no duplicates can happen 've hired a guy called blockchain to check every single sale of any queue position once ve sold the right to stand in that position to  it will be listed on the public blockchain there's no doubt about who currently has that position and if you want to sell your q position to someone else that's fine you can do that this sale will also be recorded on the blockchain but why would anyone want to buy a position in a queue it doesn't go anywhere there's no value to any of the places over any of the others well here's the next trick human beings are visual creatures we like art and while every position in the queue does have a numerical value numbers don't have the appeal or the  of pictures so next to every position in this queue  put up a poster my plan is this m going to put a different picture on every single poster and buying the position in the queue will let you stand by a particular poster it's important to remember you do not own the poster you do not own the picture on the poster you cannot reproduce the picture on the poster or sell copies or claim ownership of it what you own is the right to say you are the only person able to stand in a specific queue position next to a specific poster you cannot prevent other people looking at your poster because you don't own it you own the right to stand next to it now people are a bit more interested because people want to say this is my picture remember it's not it's your space on the database and this picture is connected to it but for my goal of selling you nothing m making quite decent progress but now have another problem need to produce 9999 different pictures and that's going to take me quite a long time so  need to streamline the process thankfully  can do that remember there are 9999 spaces in the queue that ve created essentially meaning 99999 individual entries on the database and purchasing that space gives you the non-fundable token or MFT of that space remember the NFT isn't the picture or the sound or the video or whatever  choose to link to that space to make it identifiable the NFT is just the right to say this is my position on this particular database and the images are just linked to them as visual representations of that digital position now could sit down and draw 9999 individual pictures this would take me far too long so instead  make a machine which can generate them for me remember those children's flip books divided into sections horizontally with different heads and bodies and feet you could flip the pages in random orders to create different looking characters my machine kind of works like that  make an image generating machine igive the machine 10 different background colors 10 possible  shapes 10 different hairstyles and then 10 different accessories and your cue position your  number helps generate the image next to your spot the first number will give you the background color the second will give you a face shape the third will give you your hairstyle and the fourth will give you your accessory with this system  have just created 9999 different unique bits of artwork allowing each position in my queue to have a different image associated with it in case you ever wondered why so much  art looks like it's just been generated by a machine using the variables of the  data to randomly composite a picture it's because that's exactly what they're doing