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Brian Lehrer: Brian Lehrer on WNYC. Early this month, if you happen to be in Midtown, you might have bumped into someone wearing a sweatshirt with a picture of a cartoon chimpanzee on it. You happen to see that or maybe a pudgy penguin wearing sunglasses? Now, they weren't members of a zoological society, which might be your first guess, but some of the 5,000 people who gathered for New York's largest ever NFT Conference.

Do you know what an NFT is at this point? Here's the short version. NFTs orNon-Fungible Tokens allow you to transform a digital work of art, whether it be a gift or another piece of media, into one of a kind verifiable assets that can be bought and sold on the blockchain using cryptocurrency. Those sweatshirts I mentioned, the monkey and pudgy penguin, they represent and NFT cliques whose members own very expensive digital versions of those cartoons.

One Board Ape Yacht Club NFT, now that can sell for hundreds of thousands of dollars. Those sweatshirts are actually sly nods to someone's status in the NFT world. They're like Rolexes or Louis Vuitton bags. My next guest went to NFT.NYC and he likened it to the Woodstock of NFTs. Meaning an event that signifies the mainstream embrace now of a youthful counterculture.

Are NFTs mainstream now the way that pop art is mainstream or are they just extremely risky, volatile investment vehicles for people who have cryptocurrency to burn? What is NFT counterculture all about besides making fast money as well? With me now is Kevin Roose, technology columnist for The New York Times. He also wrote the article that sold for over $500,000 as an NFT.

We'll also talk to him briefly about mayor-elect Eric Adams asking to be paid in bitcoin for a few of his paychecks. Some critics say he's lending credibility to a potential volatile risk. Kevin, welcome back to WNYC. Hi.

Kevin Roose: Good to talk to you.

Brian Lehrer: You turned a Times story you wrote about NFTs into an NFT that sold for $500,000, wow and very meta. I can download that story with my New York Times subscription and own the exact same thing basically for free. I think that's still hard for people to wrap their heads around, explain it.

Kevin Roose: This whole universe of NFTs is very confusing for people who aren't steeped in cryptocurrency culture. Basically, what they've created is a kind of digital collectible, almost like a certificate of authenticity, a little snippet of code that you can put in your cryptocurrency wallet that says that Brian owns this New York Times article or this JPEG of monkey or this this musician's song.

That even if someone else saves that or copies it, it won't be the real canonical version of that digital object. This is made possible through the same blockchain technology that powers bitcoin or other cryptocurrencies. What it's basically allowed for is digital scarcity. This quality that gives objects in the offline world, those Rolexes and sports cars and things like that, their value, now we can do that with digital goods.

Brian Lehrer: Listeners, have you bought or sold and NFT? Tell us your story, help other people understand it from your personal experience. 212-433-WNYC, 212-433-9692. How much did you pay and how did you decide what kind of NFT to buy? Did you buy it because you like the image, the actual visual image of this piece of art, because you think it will appreciate in value or because of the community that it brought you?

212-433-WNYC, 433-9692 with Kevin Roose from The New York Times. When you have a piece of art, Kevin, you can hang it on the wall. Where do people display their NFTs?

Kevin Roose: A lot of times, they display it as their profile picture on social networks like Twitter. That's become a status symbol among people in these communities. Certain NFTs have been displayed in galleries and things like that but mainly they're useful on the Internet. They're useful as a representation of your online self. There's this idea that the Metaverse that we are all moving to, that these NFTs will become status symbols and objects, almost like a wardrobe for our digital identity.

Right now, a lot of people are storing them in their Twitter profile picture. I also saw a couple people at this conference who had used them as the watch face on their apple watch. They turned their high-priced digital collectible into a high-priced apple watch face.

Brian Lehrer: When you listen to people who are immersed in NFTs, I think you often hear the phrase that they're changing the world. When they say this, what do they generally mean? What are they trying to change? Do they think they're in some kind of social justice movement with these digital art purchases, or is this just a variation of how tech companies have marketed themselves for years?

Kevin Roose: Well, some of them are definitely in it for the money and they're speculators a plenty, and lots of people see the opportunity to make a quick buck here. The bigger picture that they always point to, these advocates, is that this is a move away from the centralized way that Internet culture currently works. We all have social media accounts, we post things, they sometimes go viral.

Artists, musicians, and YouTube creators are at the mercy of these large centralized platforms that take most of the money from the things that they create. What these NFT collectors and advocates envision is a Internet where the people who are making cultural objects actually own those objects and can profit when those are bought and sold. Where we're not all farming on land that is owned by Facebook and YouTube and Twitter but that we actually own the things that we're creating.

That's what they all get very excited about.

Brian Lehrer: Let's take a phone call, here's Evan in Brooklyn. Evan you're on WNYC, hello. Evan are you there? Evan?

Evan: I'm here.

Brian Lehrer: Hi, we got you now. Go ahead.

Evan: Sure.

Brian Lehrer: You have a story for us?

Evan: Oh, yes. About maybe three weeks ago sometime in October, just released an NFT collection on OpenSea, which is what I've learned to be the primary platform for buying and selling NFTs of all kinds. It was an interesting experience for me. I've never owned cryptocurrency. I knew what NFTs were just from hearing about them in the news over the course of 2020, that's when I first heard about them.

I stayed away from them for a while because, for the most part, the headlines of any article would be this is NFTs, they're selling for these extraordinary prices, but they're extremely environmentally unfriendly. I stayed away from them for a while, but it eventually, people--

Brian Lehrer: Is this an investment for you or does it have cultural allure? Why are you in it?

Evan: I'm in it to reconnect with my art practice and be able to put myself out there in a new way that I've never been put out there before.

Brian Lehrer: Evan, thank you very much. What about the environmental aspect that he describes? There's another caller who's bringing this up too, objecting to NFTs for that reason, but we're not going to have time to get to every caller. You want to take that one on?

Kevin Roose: Sure. There's a lot of debate about this within the NFT community. There are environmental costs to minting an NFT, putting it on the blockchain. These blockchains require massive amounts of computing power to run. NFTs are still a very small percentage of cryptocurrency transactions, so that's what people in the community point to.

Also, they say we're moving away from these kind of energy intensive blockchains to blockchains that require much less processing power and so it's going to get more environmentally friendly over time. That's what they say.

Brian Lehrer: Question from a listener on Twitter. A Rembrandt is a painting today as it was 400 years ago, who will know what a JPEG or an MP4 an MP3 file is in 400 years or even 100 years. We can't even open computer files from 20 years ago anymore. What do you say to that listener?

Kevin Roose: Yes, it's a great point. We don't know how permanent the these are sold as permanent objects. These blockchains are said to be kind of perpetual logs of activity. These NFTs, a lot of them point to the actual images are hosted on websites and those websites could go down or get acquired or just vanish from the Internet then those would basically be broken links to things that no longer exist.

There are questions around a lot of the permanence around this. That's something that people who are investing in these tokens should definitely consider.

Brian Lehrer: Mark in Manhattan made an NFT purchase or investment. Mark, you're on WNYC. Hi there.

Mark: Hi. How are you? Thank you for having me.

Brian Lehrer: Tell us about your experience.

Mark: Well, I found an image that I was attracted to OpenSea. It's like a Mandalorian spinoff. I purchased this image. It was about a little less than $500, and then I actually purchased another one. I got in contact with the artist and now I'm part of this Mandalorian community and we're actually going to create a token called Mandal X. What attracted me to this project even further is that the artist is a missionary, and all 2% of the earnings of the coin are going to go to his mission in Guatemala.

Brian Lehrer: Interesting. You're doing this for a cause hoping to raise money through this NFT for a cause? That's fascinating. Kevin related to that, since he brought up-- I don't know if it's a religious mission that he's trying to back or an antipoverty thing. A listener on Twitter asks to ask you to explain the pay to play aspect of this. He writes, "Artists must mint their work which privileges certain people." True?

Kevin Roose: Yes. Some blockchains including Ethereum, which is the most popular one that NFTs are minted on, require what are called gas fees, basically, congestion fees based on how busy the network is. That can be expensive. I think when I minted my first NFT, it costs me about $150 just to put the thing up there. A lot of people are minting tokens that won't sell for that much, that they will actually end up losing money as a result of these fees.

Brian Lehrer: All right. We've got about three minutes left. Let me ask you about Mayor-elect Eric Adams. What did you think when you heard he wanted to be paid in bitcoin for-- I'm not sure, it was the first three paychecks or the first three months, maybe that's the same thing. When he was on the other day, I said that was going to be one of the topics and then we got into other what seemed to me like media policy things and I was like, "Oh, okay. I'm not even going to get to bitcoin. I don't really care how he gets paid."

Should I care?

Kevin Roose: [laughs] I don't know. It seems to me like a bit of a publicity stunt. I'm not sure he'll actually keep that money in Bitcoin. He might just change it over to dollars, but I think it's a smart savvy political move, in part, because there is just so much money in crypto right now. These people have gotten so wealthy over the past year or two from the rising price on these cryptocurrency assets.

These startups are raising billions of dollars to take on various pieces of this market, and a lot of that is happening in New York. It's a much less West Coast based industry than the last wave of big disruptive tech startups is. I think there's an opportunity for New York to really play a big role here.

Brian Lehrer: Adam has definitely put it in that context. He thinks there's an industry to be located in New York or based on what you just said, further located in New York and there are a lot of jobs there. There are physical jobs in digital currency?

Kevin Roose: Yes, there absolutely are. They're hiring like crazy and there are several large crypto companies and startups in New York City that have actual offices, where people actually show up and go to work there every day. This is a booming industry especially in New York, and in the Bay Area where I live, and around the country.

Brian Lehrer: Do you think that he's inadvertently encouraging people to make risky investments that they may not be informed enough about? That's probably the main critique that I've heard of Adam's coming out in the way that he did.

Kevin Roose: Yes, absolutely. This is a very risky enterprise. No one is denying that. People may have lost lots of money betting on cryptocurrency ventures and people will continue to lose lots of money. None of this is a sure bet. That said, I'm not sure who the person is, who is on the fence about buying cryptocurrency and is going to be tipped over the fence because the Mayor of New York endorsed it. That just doesn't seem like where a lot of people are going for their investment advice.

Brian Lehrer: Yes. 30 seconds. How's your NFT? Did you actually make $500,000 on this? I'm not exactly sure how to interpret what I read about that.

Kevin Roose: Yes. It was a auction for charity. It went to The Neediest Cases Fund, which is The New York Times' inhouse charity. While it sold for, what at the time was worth about $560,000, the value of Ethereum spiked in the meantime, and so I ended up giving away to the charity more than $1 million worth of cryptocurrency and that was a very fun stunt that confused a lot of my bosses.

Brian Lehrer: Still confuses me. Kevin Roose, technology columnist for The New York Times. Thanks a lot, and keep coming on [inaudible 00:15:09] .

Kevin Roose Roose: Thanks for having me.

Brian Lehrer: Brian Lehrer Show was produced today by Lisa Allison, Zoe Azulay, Amina Srna and Carl Boisrond and Max Balton. Zach Gottehrer-Cohen works on our daily podcast. Our interns this fall are James O'Donnell and Prerna Chaudhary. We had Sham Sundra and Juliana Fonda at the audio controls. Talk to you tomorrow. I'm Brian Lehrer.

 

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