Why an Animated Flying Cat With a Pop-Tart Body Sold for Almost $600,000 (nytimes.com) 90
In the 10 years since Chris Torres created Nyan Cat, an animated flying cat with a Pop-Tart body leaving a rainbow trail, the meme has been viewed and shared across the web hundreds of millions of times. On Thursday, he put a one-of-a-kind version of it up for sale on Foundation, a website for buying and selling digital goods. In the final hour of the auction, there was a bidding war. Nyan Cat was sold to a user identified only by a cryptocurrency wallet number. The price? Roughly $580,000. From a report: Mr. Torres was left breathless. "I feel like I've opened the floodgates," he said in an interview on Friday. The sale was a new high point in a fast-growing market for ownership rights to digital art, ephemera and media called NFTs, or "nonfungible tokens." The buyers are usually not acquiring copyrights, trademarks or even the sole ownership of whatever it is they purchase. They're buying bragging rights and the knowledge that their copy is the "authentic" one.
Other digital tokens recently sold include a clip of LeBron James blocking a shot in a Lakers basketball game that went for $100,000 in January and a Twitter post by Mark Cuban, the investor and Dallas Mavericks owner, that went for $952. This month, the actress Lindsay Lohan sold an image of her face for over $17,000 and, in a nod to cryptocurrencies like Bitcoin, declared, "I believe in a world which is financially decentralized." It was quickly resold for $57,000. People have long attached emotional and aesthetic value to physical goods, like fine art or baseball cards, and have been willing to pay a lot of money for them. But digital media has not had the same value because it can be easily copied, shared and stolen.
Blockchain technology, which is most often associated with Bitcoin, is changing that. NFTs rely on the technology to designate an official copy of a piece of digital media, allowing artists, musicians, influencers and sports franchises to make money selling digital goods that would otherwise be cheap or free. In an NFT sale, all the computers hooked into a cryptocurrency network record the transaction on a shared ledger, a blockchain, making it part of a permanent public record and serving as a sort of certification of authenticity that cannot be altered or erased. The nascent market for these items reflects a notable, technologically savvy move by creators of digital content to connect financially with their audience and eliminate middlemen. Some NFT buyers are collectors and fans who show off what they have bought on social media or screens around their homes. Others are trying to make a quick buck as cryptocurrency prices surge. Many see it as a form of entertainment that mixes gambling, sports card collecting, investing and day trading. Eye-popping NFT sale prices have attracted some of the same confusion and derision that have long haunted the cryptocurrency world, which has struggled to find a good use for its technology beyond currency trading.
Other digital tokens recently sold include a clip of LeBron James blocking a shot in a Lakers basketball game that went for $100,000 in January and a Twitter post by Mark Cuban, the investor and Dallas Mavericks owner, that went for $952. This month, the actress Lindsay Lohan sold an image of her face for over $17,000 and, in a nod to cryptocurrencies like Bitcoin, declared, "I believe in a world which is financially decentralized." It was quickly resold for $57,000. People have long attached emotional and aesthetic value to physical goods, like fine art or baseball cards, and have been willing to pay a lot of money for them. But digital media has not had the same value because it can be easily copied, shared and stolen.
Blockchain technology, which is most often associated with Bitcoin, is changing that. NFTs rely on the technology to designate an official copy of a piece of digital media, allowing artists, musicians, influencers and sports franchises to make money selling digital goods that would otherwise be cheap or free. In an NFT sale, all the computers hooked into a cryptocurrency network record the transaction on a shared ledger, a blockchain, making it part of a permanent public record and serving as a sort of certification of authenticity that cannot be altered or erased. The nascent market for these items reflects a notable, technologically savvy move by creators of digital content to connect financially with their audience and eliminate middlemen. Some NFT buyers are collectors and fans who show off what they have bought on social media or screens around their homes. Others are trying to make a quick buck as cryptocurrency prices surge. Many see it as a form of entertainment that mixes gambling, sports card collecting, investing and day trading. Eye-popping NFT sale prices have attracted some of the same confusion and derision that have long haunted the cryptocurrency world, which has struggled to find a good use for its technology beyond currency trading.
Because someone has too much money (Score:4, Insightful)
It's not like digital art can't be endlessly reproduced.
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Manual reproduction can be pretty fun, though. This one [youtube.com] for example is great.
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The point is that it's just bragging rights. Well that or a money laundering scheme. Humans are wired to compete and when you have more money than you could ever use, the competitions get a bit bizarre. This isn't really any differe
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The point is that it's just bragging rights.
Basically what most rich people like to do most of the time.
Well that or a money laundering scheme.
DING DING DING DING DING DING!!!!
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A lot of that weird rich-people collecting stuff is quite a bit more practical than it might appear. Quite a bit of it is very valuable for tax evasion purposes.
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"A machine could replicate it well enough that no one outside of an expert could tell it wasn't genuine ."
The age of the paint, even what chemicals are in it, would be a dead give away that it was not the original.
Re: Because someone has too much money (Score:2)
This is known as "Hoarding".
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The value added here is an easy official way to check if the merchandise is genuine, whatever that is. It is like the holograms sports teams put on their inflated merchandise. Like you could not make those yourself if you really wanted.
People have money, will
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Anyone who buys these things casually for more than a penny are dumb. And what happens when you house burns down?
Exactly, it's uniqueness of an assertion (not even ownership). At least with a poster it's a single, unique physical thing that exists and is owned. And if a second one gets discovered, it likely will decrease the value of the first (depending on conditions, etc.).
Re: Because someone has too much money (Score:2)
Yes, somebody can counterfiet a rare MLB card. But almost always they get at least one detail wrong, one being using non-aged cardstock to reproduce vintage card.
No matter gow minor, that detail will instantly indicate "counterfiet".
And also, why bother? If you are going to commit crime, it's better just to manufacture drugs where the labor costs are low and the payout is high.
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Yep, we've got working people unable to afford basic living expenses while asshats with far too much money spend at least a quarter of a hard-working person's lifetime earnings on an unremarkable nyan cat gif for the lulz.
This should replace carbon brake systems on street cars as the most dire economic red flag yet seen.
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Yes but the bits in my copy have been registered with Lloyd's of London which means they're totally unique and super valuable!
I'll sell individual bits for $2 and a whole byte for $4.
More hilariously, it reminds me of this: http://stupidstuff.org/main/mi... [stupidstuff.org]
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It might make more sense if the buyer was buying *IP* rights. But according to TFA they're not getting any kind of right other than to say they have an *authorized* copy.
Economic value is a weird thing with art. Suppose you owned a copy of an original Monet that would sell for over fifty million dollars, and it was good enough that it would take an art expert to tell the difference. It might be worth a couple of hundred dollars, even though your objective sensory experience of the thing would be no diff
Re: Because someone has too much money (Score:2)
Because owning the original gives you "bRaGgInG rIgHtS". A copy would be bought to make your wall look good.
Value is what people are willing to pay (Score:2)
Is it stupid that people put $8000 sets of wheels on a $400 Toyota Corolla. Who am I to judge? It's just a question of individual priorities.
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Even to a point what is the value of owning a 10,000 square foot home vs 1,000 square foot. Or getting a Rolls Royce vs a Corolla.
People buy items to impress other people. Being someone bought the bob tart cat, is just the same thing.
He may sell the rights for people to use it, so it may make business sense. Or he may just put it in a museum.
Not all things of value, are practical, or a good decision. However it is just that enough people want it and will be willing to pay for it.
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Using blockchain to establish a singular identity for digital goods is really a new element though. Obviously that's the only basis for value in Bitcoin, which is a lot, at least currently.
And it is axiomatic that in order to "buy low and sell high," you must first "buy low" w
You put an expensive set of wheels on a cheap car (Score:3)
WTF? (Score:2)
That's pretty much all I can say to this, just:
WTF?
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It is no stupider than buying rare stamps or diamond rings.
If anything, using digital goods as a wealth marker is an improvement. Mining for diamonds and gold is very environmentally destructive. Creating a digital cat, much less so.
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Re: WTF? (Score:2)
Well, if they want to be fleeced like this, it's their choice.
Re: WTF? (Score:2)
Regarding rare stamps... When you got a dad traveling the world, stamps have been more like soivenirs from exotic remote countries. E.g. Bhutan had round relief ones with green and gold, that looked way cooler than ours.
But then, we collected the postcards they were glied onto. So not just stamps. And they were always from conflict areas, so it was amazing when they arrived at all.
(Fuck those morons who never take some collectible out of the box!)
Certificate, not art. (Score:1)
Youâ(TM)re not buying the art, youâ(TM)re buying a token that represents the art.
This is like buying the Mona Lisa, but instead of getting the original ( which stays in the museum or is destroyed ), you get a copy of the painting and a certificate that says this is the one official copy.
Nice way to patronize the artist, but after that the value makes less sense.
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Nice way to patronize the artist, but after that the value makes less sense.
What's the value of keeping an artist from living up to the "poor" label we historically stick the profession with?
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I hope you're not implying Linday Lohan is an artist.
Re: Certificate, not art. (Score:2)
Nyancat may be simply and silly, but the point of ar is to get an emotional insight or argument across.
And I found the original thing with music pretty funny in a Monty-Python-on-colorful-Japanese-LSD kinda way and it gave me a feeling of what such Japanese girls might feel like.
It was very faint and very little and also generally almost useless, but but still was the above.
So we could say art, yes, but close to minimum viable. So compared to organisms, one step above viruses and one step below the simplest
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Some art (presumed meaning). Much is simply to get a sale. This is especially true of post-modern.
This is usually tax avoidance (Score:1)
1. Buy artists art for inflated prices.
2. Value of art sky rockets because somebody (you) is buying it for inflated prices.
3. Donate art to 501(c).
4. Write inflated price off on your taxes, saving millions in the process.
If you've ever seen some rich schmuck buying up idiotic modern art and wondered why, this is why. It's a scam to get out of payi
Re:This is usually tax avoidance (Score:5, Insightful)
More likely reason is money laundering or transferring payment for illegal goods. I can't list cocaine and Asian escorts on my expense account, but I can always buy a shitty painting from whoever had the hookers and blow. Solves their problem of listing the same as a source of income. There's less reason to do this with crypto currencies since they aren't officially money and the law really hasn't worked everything out regarding them yet.
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You pay them 10 million but suddenly the art is worth 200 million so when you donate it the value is 200 million so you have a 200 million deduction on your taxes which saves you far more than the 10 million you paid out.
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That doesn't work.
Your write-off is limited to what you paid for the art. If you want to declare a higher value, you would also need to pay tax on the gain, canceling out the higher donation.
So you gain nothing from your scheme.
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No, you do not owe capital gains taxes on donations. That's why Gates, Buffet and co. donate most of their shares.
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No, you do not owe capital gains taxes on donations.
Then you don't get a write-off.
You can't write off a donation of money you never had.
Bill Gates donated his shares to his foundation. The foundation received the shares tax-free. But Bill Gates could not deduct the value of those shares from his taxable income.
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I don't think you are saying it correctly because I use this tax savings trick.
let's say i own a stock at $10
market is $100
I can give my stock to someone and they will pay a gift tax
I can die and will my stock to someone and they will pay an inheritance tax
OR
I can donate my stock that I bought for 10 at market price ( 100 ) to a charity
and receive a full $100 write off.
that $90 gain I was able to leverage off of over time anyway. Talk to your account
about this. because I can offset taxable gains this way.
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I don't think you are saying it correctly because I use this tax savings trick.
let's say i own a stock at $10 market is $100
I can give my stock to someone and they will pay a gift tax I can die and will my stock to someone and they will pay an inheritance tax OR I can donate my stock that I bought for 10 at market price ( 100 ) to a charity and receive a full $100 write off.
that $90 gain I was able to leverage off of over time anyway. Talk to your account about this. because I can offset taxable gains this way.
You should talk to your accountant, because 2 out of the 3 things you said were incorrect. Gift taxes and inheritance taxes are paid (after the exemption allowance) by the gifter / estate, not the recipient. Also, keep in mind that the donations of stocks and other assets can follow different rules depending on the type of charity (public, private, etc) and type of asset.
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you are right when the gift is less than 16K or so, I have to file a form when I give.
I misspoke on the inheritance tax, the estate pays, which in the most cases is the estate manager and beneficiary screaming why they take so much.
and I was narrow focused on the stock- most charities when given stock properly for write off know the steps, you just inform them. Never had a problem giving and getting the write-off
Re:This is usually tax avoidance (Score:4, Informative)
Your write-off is limited to what you paid for the art.
Nope. [irs.gov]
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Your write-off is limited to what you paid for the art.
Nope. [irs.gov]
There is nothing on that page that disagrees with anything I said.
You can't write off donations of untaxed gains.
The law doesn't work that way. If it did, why would anyone ever pay taxes?
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There is nothing on that page that disagrees with anything I said.
You obviously didn't read that page very carefully. The page is the instructions for filling out Form 8283 Noncash Charitable Contributions. It clearly talks about fair market value, and appraisal requirements to determine FMV, particularly those for works of art:
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If the IRS just limited your deduction to the original purchase price, they wouldn't be requiring appraisals.
It would be silly on the face of it too. That would basically saying you could never deduct the original value when donating due to the inflationary nature of money devaluing the art. It would also be at odds with paying capital gains on the value at the time of sale.
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Yeah, I don't think Bill thought things through.
My brother has a landscape hanging in his study that was handed down from my grandparents, who received it as a wedding gift when they were married during the depression. No one knows what was paid for it, but it couldn't have been much. Long story short, turns out it was painted by a notable artist and is worth quite a bit more than the $20K threshold the IRS requires for an appraisal.
Should my brother decide to gift the work to a museum, what would be i
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Donations on goods are based on their current value, not what you paid for it. Contrary to what you suggest.
The OP is right in that if the purchase can get the overall value of the artists works to increase in value later they can donate and claim the estimated value at the time of donation. The OP is wrong in that this is scammy because if the value of the work has actually increased from 10million to 200million then the charity IS receiving an object of that value and the donor is giving away an object o
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The tinge of scam comes in because the high end art world is pretty small, and a lot of collusion happens. Some famous gallery owner will identify an "up and coming" artist who can churn out some art. The gallery owner will match the artist up with some rich people who want to "invest" in paintings. IIRC usually you buy several paintings, hang onto some and resell the others. The gallery owner and all his art-buying friends help push up the price, along with their art critic buddies. Now the original artist
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Donations on goods are based on their current value, not what you paid for it.
Here is an example: You buy a painting for $100. Then you have it appraised for $1000. Then you donate it to charity.
You can write this off as a $100 donation.
Or you can declare the $900 gain on your taxes and declare it as a $1000 donation.
Your net tax deduction is the same.
What you can't (legally) do, is write off the $900 gain as a tax deduction against income earned from other sources.
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Even if you are correct (I don't know), as long as the art is held for a year (I think), then it turns the gains into long term capital gains, which are taxed at lower rates than the immediate effect of the donation. Hence a net gain.
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Doesn't work out the same at all for the recipient of the donation....
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You need an appraisal to assign a new value. You are not going to find a house appraiser who is going to certify your house is now worth 500M. But you can find art appraisers who can do that because art is partially so subjective.
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I'd be overjoyed to have to pay taxes on ten million dollars. It would mean I'd made ten million dollars.
Re:This is usually tax avoidance (Score:5, Informative)
this one might have just been a crazy bitcoin millionaire, but most of these "art" deals are tax avoidance schemes. The way the scam works is this: 1. Buy artists art for inflated prices. 2. Value of art sky rockets because somebody (you) is buying it for inflated prices. 3. Donate art to 501(c). 4. Write inflated price off on your taxes, saving millions in the process. If you've ever seen some rich schmuck buying up idiotic modern art and wondered why, this is why. It's a scam to get out of paying taxes. It works because the value of art is subjective and because we don't do very many IRS audits.
I'm sure some donated art tax fraud occurs, but it doesn't happen the way you describe and it is not widespread by any stretch of the imagination for several reasons.
1. It takes more than one rich schmuck to inflate the prices of an artist's work, especially if the artist is relatively unknown. A private purchase means nothing for the value of an artwork. By and large, auctions and galleries are where prices of valuable art are set. Unknown artists selling second or third rate art rarely make it to the auction block or gallery wall. Buying art for $1K and somehow pumping the value to $1M would take an awful lot of time, effort and collusion among a many many people. Collusion on auction prices has/does occur, but it's at the high high end of the market.
2. 501c3s who will accept donations of art are limited. Displaying/maintaining art collections has to be a part of the organization's mission in some capacity, per IRS rules. Most eligible charitable organizations have committees in place to review and accept/deny potential donations. The donee organization is required to sign a form attached to the donor's tax return for the piece(s) claiming a deduction. Donees are not known for accepting donations of worthless art. It harms their reputations.
3. If the deduction sought for donated art is $5K or more, a qualified 3rd party appraiser (certified by the ISA, ASA or AAA) must attest to the value with the IRS. If the deduction sought is $20K or more, the actual detailed appraisal must be attached to the tax return of the individual seeking the deduction. The IRS has an Art Appraisal Review Board that scrutinizes high value appraisals submitted for deductions. Art appraisers don't want to get sideways with the IRS. There are significant penalties imposed on appraisers for gross overvaluations of artwork, and bogus appraisals harm their reputations as well.
4. In the event the donee sells, exchanges, or otherwise disposes of the art within 3 years after the date of receipt, the donor is subject to tax reclamation on the difference between the deduction and disposal price.
5. Most importantly, there are a kajillion tax dodges that are more effective, less costly, and less risky than involving a bunch of third parties who have to expose themselves to liability in order to help someone cheat on their taxes.
Yeah, the rich dodge taxes. But not in any great number with art.
Re: This is usually tax avoidance (Score:2)
Can finding loopholes and taking advantage of them in creative ways be considered a work of art all of it's own? :O)
OK Boomer (Score:1)
After seeing this I'll finally accept my mantle.
Re: OK Boomer (Score:2)
I imagine throwing those morons into a big bonfire, and then after hearing you comment that, tell you: "Could you be so kind and jump in the fire with them, my failed child? Before we're knee-deep in your soy-blood."
Oh wow. This seems like a bad idea (Score:2)
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It's new Dutch Tulip Bulb mania, just in digital format.
This fad may be even more worthless, since the thing in question can be reproduced endlessly at virtually no cost.
Stop saying blockchain is "immutable." (Score:5, Informative)
It's a fallacy that blockchain is permanent. All it takes to change ownership of these NFTs is a 51% consensus among the nodes who manage the blockchain.
Currently, with bitcoin, 82% of the blockchain processing is located in mainland China. If those mining consortiums decided to forge their own version of the blockchain, they could do so. Then the whole notion of who owns what would be arguable and it would likely create chaos.
Re: Stop saying blockchain is "immutable." (Score:2)
You can choose to ignore them though.
If your people agree, their 80% still mean nothing to you.
In IRC parlance that is called a "netsplit".
IMHO that's a feature, not a bug.
(People are not all the same. There is no absolute reality. At least we will never be able to tell.)
Re:Stop saying blockchain is "immutable." (Score:5, Interesting)
> It's a fallacy that blockchain is permanent. All it takes to change ownership of these NFTs is a 51% consensus among the nodes who manage the blockchain.
The risk is higher or lower depending on the chain's consensus rules.
The Cash chain of Bitcoin, for instance, has an 11-block immutability feature. So you can mount your 51% attack for ~2 hours after a transaction, but after that it's forever on the chain. There's no rewinding history past that for Bitcoin Cash - that's why it can be used in actual commerce (nodes will reject blocks that violate the immutability rule so there's little reason to bother). Compare with, say, Verge or the Wall St. version of Bitcoin (Blockstream's BTC) which can't be trusted for commercial applications.
Short version: for a coffee, who cares - just zero-conf and go - for corporate M&A, wait two hours before announcing the sale.
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It's a fallacy that blockchain is permanent.
That statement is very largely untrue. Very very very large.
All it takes to change ownership of these NFTs is a 51% consensus among the nodes who manage the blockchain.
False.
A 51% attack will only be possible during the mutable time window.
A 51% attack is mathematically impossible beyond the mutable time window.
Currently, with bitcoin, 82% of the blockchain processing is located in mainland China. If those mining consortiums decided to forge their own version of the blockchain, they could do so.
Also false.
If those mining consortiums attempted a 51% attack, using bitcoin, it MUST be performed in the first two hours after the transaction, during the mutability window.
After that two hour window, it would require a 100% consensus to use a completely different protocol on a brand new blockchain, igno
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Currently, with bitcoin, 82% of the blockchain processing is located in mainland China. If those mining consortiums decided to forge their own version of the blockchain, they could do so.
Also false.
If those mining consortiums attempted a 51% attack, using bitcoin, it MUST be performed in the first two hours after the transaction, during the mutability window.
After that two hour window, it would require a 100% consensus to use a completely different protocol on a brand new blockchain, ignoring all transactions on the old existing blockchain.
A consensus attack isn't possible on transactions prior to that two hour window.
When it comes to Foundation, the mutable window is 15 minutes.
Not to mention there are far fewer transactions on Foundation than compared to Bitcoin, so is trivial to watch them all in that 15 minute time frame if you cared to do so.
Think so? If they wanted to they could. They get to chose the time and place for the attack. Do you think that a nation state like China couldn't make it so only their machines are online? There's your 100%.
In fact, it wouldn't even need a nation state. A guy like many on slashdot could do it. We could move say 90% of the bitcoin to one account. Then what?
It's not real. Only fools put real money into it.
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Or everyone to get bored and delete the thing. A blockchain is permanent like Linus's backups.
Re: Stop saying blockchain is "immutable." (Score:2)
I think I'll just stick with good old fashioned US funny money instead of Bitcoin funny money.
Re: The increasingly dystopian online experience.. (Score:2)
Alright, it seems the root of your problems are the use of questionable VPNs.
Use quetionable VPNs that might very well be slurping your data, or expose fully to Google. Descisions descisions....
Remember the "I Am Rich" iPhone app? (Score:3)
Remember the I Am Rich [wikipedia.org] app? This is that.
Re: Remember the "I Am Rich" iPhone app? (Score:2)
Curious. As it was also the "I Am Stupid" app to everyone else.
Re: Remember the "I Am Rich" iPhone app? (Score:2)
And to think people were buying that 'app' knowing full well what they were getting.
"i hAvE mOnEy tO tHrOw aRoUnD!"..derp derp derp.
Um, yay? Want the cookie I dropped on the ground for your 'winning' trophy?
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Remember the I Am Rich [wikipedia.org] app? This is that.
I only know of that app because of all the free publicity it got. I never understood why journalists gave a worthless app so much publicity. And now it even has a Wikipedia page? Ridiculous.
Mankind is doomed... (Score:2)
Re: Mankind is doomed... (Score:2)
Still more art than Jackson Pollock will ever be, to he frank. ^^
What does "sold" even mean here? (Score:2)
Because I have my cop under "~/pictures/memes/random thrash/" just fine.
Finally, (Score:2)
ITs a mystery (Score:2)
There's a paywall on the article so I guess we'll never know.
New markets (Score:2)
Not surprising (Score:2)
Look at all the crap art that sold for millions that only had a fraction of the talent behind this.
I don't know if "modern art" is a scam, peer pressure, bad taste, mental disorders, or a combonation of all 4.
Here's a clue:
A Rembrant painting is art
Roman statues are works of art
Random shit scribbles is NOT art.
Once somebody gets past kindergarten, and the parents (hopefully) stops lying to them about what they drew being a masterpiece, they should be able to start telling the difference.
KYM's interview video... (Score:2)
https://www.youtube.com/watch?... [youtube.com]
Who said it sold? (Score:1)
Typical comments (Score:1)