NFTs & Publishing

In recent years blockchain technologies and cryptocurrencies, such as Bitcoin, Ethereum and Litecoin, have taken the digital world by storm and prompted investors, enticed by the prospects of capitalising on this new world terrain. For the many less tech-savvy people, such as myself, those changes brought nothing new, except for a lot of confusion whenever anyone brought up their ‘mining’ experiences into a conversation. As digital innovations are slowly taking over industries, even if we would like to think otherwise, what goes on in the digital world directly or indirectly concerns all of us. 

What are NFTs and why is everyone talking about them? What does old-world publishing have to do with all of this? We better open a digital glossary and try to make sense of things! 

What are NFTs?

Non-fungible tokens.

…

Now, for the less tech-savvy. 

NFTs can be any type of digital media (such as drawings, music, GIFs, articles, and ebooks). So long as it is digital, almost anything could become an NFT. A recent example is Twitter’s founder, Jack Dorsey, selling his first ever tweet as an NFT for $2.9 million dollars.

NFTs present one-of-a-kind (unique) digital files stored somewhere on the internet. Most NFTs are part of the Ethereum blockchain, which alongside Ethereum (ETH) cryptocurrency, also stores NFTs. It is important to understand that the digital file is not what the actual NFT is. The NFT is the record on the blockchain that stores the information and history of the digital file. When someone buys an NFT, they buy ‘ownership’ over that file, though the original creator still retains copyright and reproduction rights. In some cases, NFTs include limited material and are a great way for buyers to support their favourite artists. Furthermore, NFT buyers usually get some basic usage rights, such as the right to post the artwork online. 

Let’s imagine the Mona Lisa as an NFT, if the original was a digital artwork as opposed to a physical one. Any reproduction of a digital artwork is the exact same copy of the original, but only those owning the NFT can claim to own it. In other words, NFTs have become a way for collecting valuable digital artwork.

Now, buying an NFT does not necessarily give one exclusive access to the contents of the file, as anyone can view it the exact same way the buyer can. In essence, the NFT gives the buyer bragging rights. What it also gives, is the right to alienate the artwork. Having ownership over the file means that one could later sell the NFT (like physical artwork, the value could go up over time) and any transactions and changes in ownership are stored on the blog chain. This has presented a huge positive for the original creators, because each time an NFT is purchased or changes hands, a percentage of the transaction goes to the artist, thus allowing creators to profit from their artwork continuously. This, perhaps, is the biggest plus NFTs could bring into publishing.   

NFT books 

An NFT book, or digital first edition, would be similar to an ebook in terms of viewing and reading it. Instead of just existing as a downloadable file though, an NFT book is linked to blockchain technology which serves as an irrefutable digital contract between creator and purchaser, making it hard for just anyone to share or even, steal the file. Furthermore, it is up to the creator to decide how many NFT copies of the book they want to create (or ‘mint’ in NFT jargon), turning NFT books into collectible items and a way of publishing limited edition books. The creator may decide for the file to contain extras that are not included in other editions, such as bonus chapters, forewords, glossaries, audio and video content, author interviews, maps and illustrations etc. 

The fewer NFT copies exist, the more likely it is that the value of the digital first edition would rise over time, as we have seen with rare physical books that are often auctioned at high prices. NFTs, however, allow not just the owner of the book to profit from any re-selling of the book, as the creator also receives a certain amount of the resale price (usually around 5-10%). This presents a new opportunity for indie publications and self-published authors to profit more from their works, as the royalties they receive are also higher. While retail platforms such as Amazon charge huge fees (between 30-65%), the largest NFT trading platform, OpenSea, only charges 2-5% per transaction. Whilst OpenSea does not allow PDFs to be minted as NFTs yet, there are other platforms which support file formats suitable for literary editions, such as Publica and BookVolts.

Alongside these benefits and considerations, are also doubts of whether NFTs are here to stay. The biggest concerns when it comes to NFT books are to do with availability and copyright. Whilst NFTs generally provide more security against pirating, they would not hinder illegal reproducing, as links to the files could be easily shared without the NFT owner’s knowledge, making exclusivity much more difficult to maintain. However, it is important to remember that literary NFTs are still in their infancy and there is a lot currently being done to improve their security and accessibility. We will be looking out to see just how much NFTs are bound to change the future of publishing.