In our last installment of burning questions, I called for all your questions about the Blockchain, a much-talked-about transformative tech that few people know much about.
This time, it's the question sent by long-time reader and client Tatiana Soldatova that picked my interest:
"Do you think we will be able to buy NFT neighborhoods eventually? Or main city land marks?”
There has been a lot of grumblings about crypto, NFTs, and smart cities of late, sometimes all three together in some kind of strange utopian permutation. NFTs, as I understand them are merely unfalsifiable certificates of authenticity. If you buy an arguably overpriced NFT from Beeple it's not the digital art that's unfalsifiable, that remains an infinitely reproducible digital file, like any other. The NFT is proof of ownership that allows the public that you indeed own this art.
So to your question of buying NFT neighbourhood or landmarks, that would depend on whether its rightful owner would be willing to part ways with their precious assets and "part them out" in some kind of newfangled auction, something that would be rather unprecedented, although I have trouble imagining Paris selling off the Eiffel Tower or Giza parting ways with its pyramid.
To your point, though there are places that beginning to experiment with crypto, for example, with the issuance of a city coin that enables people interested in the life of the city to have a say by literally investing in the city's future. While this sounds like an interesting idea, it is only viable if based on a coin whose money supply cannot be artificially increased on a whim.
Bitcoin is appealing because it is a genuinely public good that no one owns. It's only the decisions agreed upon by a majority of its users that make changes to the infrastructure possible, but it's become so widespread and valuable that it's extremely unlikely that the majority of stakeholders would allow for changes that are at any risk of negatively affecting the currency's value. It's become so valuable precisely because it's a virtually untouchable hedge against the inflation that the fiat currencies of the world have brought about. The effects of the wanton printing of the world currencies has started to make itself painfully apparent (have you dined out lately?) and bitcoin has seen a corresponding increase in value as the trust in anything fiat is going down.
A city coin, on the other hand, if minted by a local government, would likely not be as stringently designed to prevent the supply of coins to be increased beyond the initial pre-determined amount and therefore equally susceptible to inflation. I wouldn't put it past any city government who decides to mint their own coin, to resist the temptation to "print" more of their own money.
But I don't think we need yet another "shitcoin" (a term of endearment for any coin riding on the BTC craze but without the same underlying infrastructure) that's not as mathematically solid as bitcoin. The technology already exists (BTC and its blockchain), so why try to re-invent the wheel?
In short, I'm very bullish on what the blockchain can do for the future of the city and I think we are about to see major and radical transformations happen very quickly, but I am very bearish on specific coins that claim to solve all the ills of the city while being controlled by the powers that be at the same time.
You can't trust your mayor to the judge, jury and executioner, now can you?
To bring this back full circle, I think we will be able to buy just about everything with smart contracts and/or NFTs and you can bet that we will see new ways of raising capital, new forms of ownership, and countless other innovations pop up.
The real question is this: which one of those will survive the initial hype and prove to genuinely make things better?
—
Thanks Tatiana (of Syllable) for the pertinent question (don't forget to claim your gift)!