2:24
- ABC News
- January 1, 2022
Pizza, mutant apes and sea of NFTs: Welcome, Web3
But are NFTs and Web3 overall, transformational or a lot of hype?
2:24
Early-adopting celebrities and brands
Big brands and celebrities are also launching NFT-Web3 projects, tying real-world services and products to digital tokens.
Companies including Nike, Taco Bell and Coca-Cola have launched NFTs (mostly tied to fundraising campaigns for social causes) or are making investments in blockchain technology.
But how can NFTs deliver more for brands than the social media channels and tools that already exist? And why on earth would anyone want to own a digital image of a Taco Bell taco?
Those are the types of questions surrounding NFTs and Web3 that academics like Scott Duke Kominers delve into. Kominers is the MBA Class of 1960 Associate Professor of Business Administration in the Entrepreneurial Management Unit at Harvard Business School, and a faculty affiliate of the Harvard Department of Economics.
\"In the short term, NFTs are transforming our ability to have ownership of, and thus markets in, digital goods and commodities … and that will start filtering into physical goods and commodities,\" Kominers told ABC News. Kominers is involved in and advises several NFT projects and has written a paper for Harvard Business Review on how NFTs create value.
NFTs are intriguing not just for artists who have potentially new online marketspaces to display and sell their art, but for musicians as well. The hip hop community has been particularly receptive to NFTs.
Legendary hip hop producer Timbaland is offering his second online NFT auction. While Timbaland's representatives did not respond to a request for comment, the music producer has spoken enthusiastically about NFTs and the metaverse. His latest NFT auction is built around tracks from his upcoming EP, \"Opera Noir,\" Decrypt reported.
Never late to a trend, Snoop Dogg recently announced his upcoming NFT project on Twitter and changed his official profile pic to an NFT cartoon ape.
I’m paving new avenues for NFT growth through my Collab I got coming wit @Babolex on https://t.co/vaUYWClg2n
— Snoop Dogg (@SnoopDogg) December 7, 2021
🎥👊🏾💥💫 #Solana pic.twitter.com/tdifEjX5T4
Def Jam records founder Russell Simmons is also reportedly working on an NFT project.
And there's money to be made according to some experts, for not-so-famous musicians, other creators and everyday people who purchase NFTs, according to some. Kominers says the very nature of blockchain can provide new economic opportunities for creators. \"Every transaction that occurs, some share of that transaction goes back to the original artist or creator. And we're seeing [that] with music,\" he said.
\"Many [NFTs] are set up so that some share of every transaction is sent back to the original creator (or more technically, the original creator's crypto wallet). For popular collections, this can be quite lucrative -- some creators' works have tens of thousands of ETH [Ether] or more in secondary transactions; a 2.5% royalty on 10,000 ETH in secondary transactions would be 250 ETH, or roughly $1 million,\" he said.
Fity.eth also speculated on the benefit for anyone who purchases music NFTs.
\"Down the road, you're going to be able to buy ownerships of a song. And you'll be able to profit share from that song from every time that song was played,\" he said.
NFTs: A new way to fund startups?
A-listers and big brands aren't the only ones jumping into NFTs, though. The small business world is dabbling as well.
Dan and Nick Hunnewell are brothers and owners of Coffee Bros., specialty coffee roasters based in Queens, New York City. In addition to roasting and selling their coffee online, they've created an NFT project called Crypto Baristas. The funds generated through their NFT characters will go toward opening their first café in New York City in 2022, Dan said.
\"It's somewhat like a Kickstarter campaign,\" Dan told ABC News. By offering NFTs, \"we're reaching out to a community to build funds.\"
![\"PHOTO:](\"http://a.abcnews.com/images/Technology/new-internet-coffee-bros_1-02-ht-iwb-211230_1640878698431_hpEmbed_3x2_384.jpg\")
\"We're working with an artist, Tony Bui, who has his own style and existing following. He comes up with characters, and then we create a story for each one,\" Dan said.
NFTs have also allowed them to quickly build a community of 11k followers, fans, and investors. He and Nick use Discord, a messaging and communication app that hosts a lot of blockchain and NFT communities, to communicate with their NFT-holding customers.
\"The community that we have on Discord is phenomenal,\" he said. Through Discord, Crypto Baristas can offer fans who buy NFTs \"caffeinated perks\" like 15% off products for life and a say in how the funds generated are used towards the café and future projects.
![\"PHOTO:](\"http://a.abcnews.com/images/Technology/new-internet-offee-bros_2j-02-ht-iwb-211230_1640878698433_hpEmbed_5x2_384.jpg\")
The transformative potential of Web3 and NFTs, according to some
Some experts and enthusiasts see Web3 and the technologies that come with it like NFTs as able to do far more than give us ways to collect cool stuff and join online clubs.
\"I sit on a board with NFT people,\" Fity.eth said. \"They're talking about our passports, our driver's licenses on the blockchain. … Imagine you lose your passport, you just go on your computer, you create it, you have all your credentials, and you get a passport. Since it's one-of-a-kind on a blockchain, you can verify [it].\"
Web3 and NFTs present opportunities \"for other digital interactions to create forms of ownership,\" Kominers said.
The technologies are poised to \"change our interface with digital content,\" he said. For example, the digital wallets used to store NFTs and cryptocurrency can be programmed to plug into other platforms, like online shopping sites, he said.
Web3 skeptics
NFTs currently offer new generations of collectibles, give brands new marketing opportunities and provide creators with new ways of making money, so -- what's not to like?
Plenty, if you ask software engineer Geoffrey Huntley. Huntley spends a lot of time online expressing skepticism about NFTs and Web3.0.
\"Currently, the majority of blockchains, especially the ones used in the NFT space are permissionless,\" he said.
That means the same digital wallet that someone uses to store their NFTs can be sent anything by anybody, Huntley explained, including abusive content like revenge porn or other digital forms of harassment.
Digital wallet holders can't delete anything unwanted sent to their wallet. That inability to delete data could also put blockchain tech at odds with the European Union's General Data Protection Regulation policy, he said.
\"The blockchain is immutable. When something's on there, it's permanently on there,\" Huntley said. \"There's nothing stopping someone for sending abusive content into your wallet, like spam, and then you can't do anything to delete it.\"
Kominers says that's true, \"to a large degree.\"
\"An address on a public blockchain is kind of like an email address, in the sense that anybody who knows yours can send things to you … even if you \"delete\" something from your wallet, there's still a traceable history that the content was there at some point,\" he said.
Kominers said that for now, crypto-enthusiasts mitigate this risk by \"having multiple wallets, some more public than others (just like people might have both personal and professional email addresses). And blockchain front-end platforms have some degree of spam filtration -- OpenSea, for example, has systems to hide spam NFTs. But in the near term we definitely need better wallet privacy and content filtration technology.\"
While far from perfect, Facebook, Twitter and other Web2 applications do have privacy controls baked in that are so far lacking on blockchain platforms.
Huntley also mentioned a concern brought up by green energy activists: It is very resource- intensive to create NFTs and cryptocurrency.
The World Economic Forum said this about Bitcoin alone: \"In 2020, the bitcoin network consumed a reported 131.80 TWh of power to execute the algorithms that power its \"mining\" operations. This is equivalent of the power consumed by Argentina.\"
\"I suspect we're going to soon see a combination of government leadership, regulation, and consumer sentiment pushing towards more sustainable blockchain technologies that are less costly to run,\" Kominers said.
Even Jack Dorsey and Elon Musk have offered recent criticisms of Web3 and blockchain. Dorsey seemed to mock venture capitalist involvement in a Dec. 20 tweet.
You don’t own “web3.”
— jack⚡️ (@jack) December 21, 2021
The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label.
Know what you’re getting into…
\"You don't own \"web3.\" The VCs and their LPs do. It will never escape their incentives,\" Dorsey portends. Venture capitalists have made big investments in crypto in 2021, ranging in the billions according to some reports, such as this one in Forbes.
In a tweet dated Dec. 19, SpaceX founder Musk called the metaverse (another fundamental component of Web3 that involves virtual and augmented reality), \"more marketing buzzword than reality right now.\"
I’m not suggesting web3 is real – seems more marketing buzzword than reality right now – just wondering what the future will be like in 10, 20 or 30 years. 2051 sounds crazy futuristic!
— Elon Musk (@elonmusk) December 20, 2021
Web3 Wild West
The new internet is very much a new Wild West, of sorts. There are very few consumer protections right now around blockchain, crypto and NFTs.
And that, according to Kominers, \"creates a situation where there are lots of ways\" people can be taking advantage of or scammed.
\"One of the biggest barriers at the moment to much wider spread of crypto and engagement in markets like the NFT market, is that most of the ways of accessing these crypto markets just don't have anything resembling the protections we're used to in other sorts of financial services or product markets.\"
But he said there will be regulatory frameworks in place for Web3, \"possibly even reasonably soon.\"
Blockchain, Web3 is \"not where it needs to be for mainstream adoption,\" said Catalini. \"We're still in a very embryonic phase.\" But he says Web3 and its technologies are here to stay.
\"Because they do represent a fundamentally novel way to design all sorts of interactions … for the creator … the musician of writer, blogger, or, you know, someone that creates any other sort of digital content … And so I think with all of these technologies, there's a lot of potential in the long run. And there's a lot of things that need to be figured out in the immediate term,\" he added.
\"Where we are today is where the internet was with AOL dial-up, this is so new, and we're so early,\" Fity.eth said.
Editor's note: Updated to clarify Coffee Bros.' NFT project, Crypto Baristas.
","canonicalUrl":"https://abcnews.com/Technology/pizza-mutant-apes-sea-nfts-web-30/story?id=81745754","legacySlug":"/news/story/pizza-mutant-apes-sea-nfts-web-30-81745754","noIndexNoFollow":false},"publishTime":"15:06","publishDate":"01-01-2022","updatedTime":"13:34","updatedDate":"01-03-2022","socialImage":{"alt":"One of the ape NFTs that recently went on sale at Apocalyptic Apes.","credit":"@Fityeth","ratio":"16x9","url":"https://s.abcnews.com/images/Technology/new-internet-apes-01-ht-iwb-211230_1640879473449_hpMain_16x9_1600.jpg","width":992,"height":558},"datePublished":"1/1/2022 15:06:00 GMT","video":{"live":false,"id":81745754,"headline":"Pizza, mutant apes and sea of NFTs: Welcome, Web3","mediaAssetTitle":"NFTS TRANSFORMATIONAL?","description":"But are NFTs and Web3 overall, transformational or a lot of hype? ","duration":"2:24","posterImg":{"url":"https://s.abcnews.com/images/GMA/default-img-undefined.png","width":608,"height":342},"video":{"feed":"https://service-pkgabcnews.akamaized.net/opp/hls/abcnews/2021/12/211226_vod_tech2021_v3_,500,800,1200,1800,2500,3200,4500,.mp4.csmil/playlist.m3u8"},"playlist":["132306053","132266872","132055565"]},"relatedItems":[{"contentType":"video","date":"April 23, 2026","headline":"Where things stand with US-Iran ceasefire, peace talks","section":"News","slug":"/video/132306053","id":"132306053","image":{"alt":"VIDEO: Where things stand with US-Iran ceasefire, peace talks","credit":"ABCNews.com","ratio":"1x1","url":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_1x1_608.jpg","width":384,"height":384},"images":{"alt":"VIDEO: Where things stand with US-Iran ceasefire, peace talks","credit":"ABCNews.com","crops":[{"16x9":{"small":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_16x9_608.jpg","medium":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_16x9_992.jpg","large":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_16x9_1600.jpg"}},{"9x16":{"small":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_9x16_608.jpg","medium":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_9x16_992.jpg","large":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_16x9_1600.jpg"}},{"1x1":{"small":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_1x1_608.jpg","medium":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_1x1_992.jpg","large":"https://s.abcnews.com/images/GMA/260423_gma_scott_ceasefire2_hpMain_1x1_1600.jpg"}}]}},{"contentType":"video","date":"April 22, 2026","headline":"Fallout after Fed nominee grilled on Capitol Hill","section":"News","slug":"/video/132266872","id":"132266872","image":{"alt":"VIDEO: Fallout after Fed nominee grilled on Capitol Hill","credit":"ABCNews.com","ratio":"1x1","url":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_1x1_608.jpg","width":384,"height":384},"images":{"alt":"VIDEO: Fallout after Fed nominee grilled on Capitol Hill","credit":"ABCNews.com","crops":[{"16x9":{"small":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_16x9_608.jpg","medium":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_16x9_992.jpg","large":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_16x9_1600.jpg"}},{"9x16":{"small":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_9x16_608.jpg","medium":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_9x16_992.jpg","large":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_16x9_1600.jpg"}},{"1x1":{"small":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_1x1_608.jpg","medium":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_1x1_992.jpg","large":"https://s.abcnews.com/images/GMA/260422_gma_schulze_fed3_713_hpMain_1x1_1600.jpg"}}]}},{"contentType":"video","date":"April 15, 2026","headline":"American influencer found dead in Tanzania","section":"News","slug":"/video/132055565","id":"132055565","image":{"alt":"VIDEO: American influencer found dead in Tanzania","credit":"ABCNews.com","ratio":"1x1","url":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_1x1_608.jpg","width":384,"height":384},"images":{"alt":"VIDEO: American influencer found dead in Tanzania","credit":"ABCNews.com","crops":[{"16x9":{"small":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_16x9_608.jpg","medium":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_16x9_992.jpg","large":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_16x9_1600.jpg"}},{"9x16":{"small":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_9x16_608.jpg","medium":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_9x16_992.jpg","large":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_16x9_1600.jpg"}},{"1x1":{"small":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_1x1_608.jpg","medium":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_1x1_992.jpg","large":"https://s.abcnews.com/images/GMA/260415_gma_norwood_ashlee2_732_hpMain_1x1_1600.jpg"}}]}}],"relatedContentSection":"news","schemaContent":{"name":"Pizza, mutant apes and sea of NFTs: Welcome, Web3","description":"But are NFTs and Web3 overall, transformational or a lot of hype? ","duration":"2:24","uploadDate":"01-01-2022","publication":"01-01-2022","images":"https://s.abcnews.com/images/GMA/default-img-undefined.png","url":"https://service-pkgabcnews.akamaized.net/opp/hls/abcnews/2021/12/211226_vod_tech2021_v3_,500,800,1200,1800,2500,3200,4500,.mp4.csmil/playlist.m3u8","contentUrl":"https://service-pkgabcnews.akamaized.net/opp/hls/abcnews/2021/12/211226_vod_tech2021_v3_,500,800,1200,1800,2500,3200,4500,.mp4.csmil/playlist.m3u8","link":"https://www.goodmorningamerica.com/news/story/pizza-mutant-apes-sea-nfts-web-30-81745754"}},"playlist":[{"id":"132283010","contentType":"story","section":"news"},{"id":"132273278","contentType":"story","section":"news"},{"id":"132231169","contentType":"story","section":"news"},{"id":"132206748","contentType":"story","section":"news"},{"id":"132200241","contentType":"story","section":"news"},{"id":"132054443","contentType":"story","section":"news"},{"id":"132054798","contentType":"story","section":"news"},{"id":"132033010","contentType":"story","section":"news"},{"id":"131912713","contentType":"story","section":"news"},{"id":"131830583","contentType":"story","section":"news"},{"id":"131834976","contentType":"story","section":"news"},{"id":"131554765","contentType":"story","section":"news"},{"id":"131554815","contentType":"story","section":"news"},{"id":"131543053","contentType":"story","section":"news"},{"id":"131432442","contentType":"story","section":"news"},{"id":"131121474","contentType":"story","section":"news"},{"id":"131247079","contentType":"story","section":"news"},{"id":"131228784","contentType":"story","section":"news"},{"id":"131178806","contentType":"story","section":"news"},{"id":"131142257","contentType":"story","section":"news"}],"kvps":{"pgtyp":"article","lang":"en","sp":"goodmorningamerica","programmatic":"true","bundleId":"com.abcnews"}},"analytics":{"accountID":"wdgnewwdgnewgmaweb","ns":"gma","pageName":"gma:news:video","pageType":"video","globalSpecVersion":"v1.08","siteDifferentiator":"gma:site","tagID":"g_page01","userABCookie":"0","section":"news","title":"Pizza, mutant apes and sea of NFTs: Welcome, Web3","pubTime":"10:06","pubDate":"01-01-2022","modTime":"08:34","modDate":"01-03-2022","taxonomyTags":"none","id":81745754,"editorialOtherSubjects":"","wordCount":"none","columns":"none","authors":"","authorsUnit":"none","authorsBureau":"none","subBrand":"Good Morning America","provider":"Good Morning America","videoName":"Pizza, mutant apes and sea of NFTs: Welcome, Web3","mediaAssetTitle":"NFTS TRANSFORMATIONAL?","videoId":81745754,"mediaOnPage":"video","legacySlug":"/news/story/pizza-mutant-apes-sea-nfts-web-30-81745754"},"taboola":{}},"request":{"headers":{},"httpVersion":"1.1","method":"GET","url":"/video/81745754","vary":{"host":"www.goodmorningamerica.com","cached":true,"path":"/video/81745754","forwarded-proto":"https","device":"desktop","userab":"0"}},"viewport":{"width":1260,"height":0},"user":{}};