My workout coach, Rick Gonzalez, knows that if he tells me stories during my exercise sets, I get distracted and the pain decreases. We talk football, movies, politics.
The other day he asked me, “What do you think of NFTs?”
I’m like, what?
“Non-fungible tokens,” he said.
Oh, I said, I hadn’t paid much attention. But then he got mine.
He told me how his cousin was making big dollars, er, bitcoin buying and selling digital works of art. An artist named Beeple is credited with kicking off the digital art boom a year ago when Christie’s Auction House sold a creation of his for $69 million.
Coach Rick had talked to his cousin, Jennifer Reece, a player in the NFT market. She told him, he said, that NFT buyers were preparing to move much of their life into the online metaverse.
This month, Melania Trump announced she’ll auction a white hat she wore as first lady, along with digitized versions. She previously offered an NFT watercolor drawing of her eyes.
Some political candidates, instead of asking for donations, are selling NFTs to supporters. Because it’s new, it’s more exciting than a coffee mug or a baseball hat.
Celebrities have jumped in, including Jimmy Fallon, Tom Brady, Snoop Dogg and Mark Cuban, all buying and selling NFTs.
It’s fun, and often profitable, but it turns out NFTs are also ripe for scams.
To learn more, I put a piece of my “artwork” for sale as an NFT. I also called Coach Rick’s cousin, Jennifer, with questions.
Jennifer told me how she spent $5,000 on a ‘dogecoin” investment that was miniscule. It was like 0.0001 of a coin, she explained, similar to a penny stock. After several months, she sold it for $20,000, an excellent 4-to-1 return on investment.
Here comes the uh-oh part. “Had I waited a little longer, like the $5,000 became $2 million,” she said. “I was straight up depressed when I did the math. My God, what have I done? It was really hard to deal with. I was so close.”
She shifted her attention from coin investment to NFTs. Among the most sought NFTs are digital drawings of cartoon apes. Because she got in apes early, May of last year, she paid only .08 ETH (Ethereum crypto-currency) for her first ape. That was $262. Now, she says, she has ape holdings worth up to $10 million.
She owns 30 of the apes, out of 10,000 original apes.
The apes represent humans 20 years from now who made a lot of money and are bored.
They hang at the virtual Bored Ape Yacht Club. Collectors want apes, but now they’re ultra-expensive. Rap artist Eminem purchased an ape for $462,000 – or 123.45 ETH.
How are 30 digital drawings of apes worth $10 million? Jennifer estimates her apes are worth $6 million, and the “traits,” or add-ons, she’s bought for them – robes, hats, hair — likely add another $4 million.
Last year, she went to New York and attended Ape Fest where she met other ape owners, and together they rode in a real yacht on the Hudson River.
Web 3.0, here we come
Jennifer explained that I’m locked in Web 2.0 world while she’s advancing toward Web 3.0.
Web 1.0 was the beginning of the World Wide Web. People and companies had their own static web pages.
Web 2.0 brings in social media and community focus. It’s about getting clicks, pushing advertising and collecting data, often for sale. Sound familiar?
Web 3.0, on the other hand, doesn’t hoard data; it’s shared. Individuals, not companies, build this new world together. Artificial intelligence plays a greater role.
Selling my first NFT
I tried this. I signed the cover of my new biography on Ross Perot Sr. to offer it for sale as digital art. Then I scanned it into a digital version and “minted” it using the popular website, OpenSea, where I placed it for sale.
I bought $50 in ETH on CoinBase and stored it in my new digital wallet. (Note: Last I checked that investment in two days, jumped to $59 because the price of ETH went up.)
So far, no buyers.
As The Watchdog, I worry about scams and rip-offs in this new world.
“There’s a lot of money involved,” Jennifer said. “A lot of bad actors, too. It’s easy to scam with fake websites that look real. Every day there are stories about people buying their first NFTs, and then the NFTs are gone. It’s heartbreaking, but the NFT community will help. Digital wallets can get raided, too.”
Must make for lots of drama among the apes at the Yacht Club. I’ll know soon enough. My workout coach Rick just bought his first ape. So we’ll have plenty to talk about.
Note: The Dallas Public Library is hosting me today — Friday, Jan. 14 — from 2 p.m. to 3:30 p.m. in a virtual talk about my new book on Ross Perot Sr. — SEARCHING FOR PEROT — My Journey to Discover Texas’ Top Family. Sign up before 11 a.m. at this site: bit.ly/Lieber-Perot-Library.
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