Elon Musk has turned down a $1.1 million offer to buy one of his tweets as a non-fungible token (NFT), just four hours after putting it up for sale.
An NFT is a unique digital asset that is encrypted with the creator’s signature authenticating it as their original work. They have enjoyed an explosion in popularity in recent months, with NFTs created by famous artists and musicians becoming coveted collector’s items.
NFTs – sometimes pronounced ‘nifites’ – are similar to cryptocurrencies like Bitcoin in that they live on blockchain networks – a decentralized, distributed ledger that records transactions of digital assets.
Appearing eager to get in on the craze, Musk tweeted out a two-minute original song on Monday afternoon that he claimed he was willing to sell to the highest bidder.
Elon Musk has turned down a $1.1 million offer to buy one of his tweets as a non-fungible token (NFT), just four hours after putting it up for sale
‘Actually, doesn’t feel quite right selling this. Will pass,’Musk wrote, four hours after putting up his tweet for sale as an NFT
What are NFTs?
What is a NFT?
A Non-Fungible Token (NFT) is a unique digital token encrypted with an artist’s signature and which verifies its ownership and authenticity and is permanently attached to the piece.
What do they look like?
Most NFTs include some kind digital artwork, such as photos, videos, GIFs, and music. Theoretically, anything digital could be turned into a NFT.
Where do you buy them?
At the moment, NFTs are most commonly sold in so-called ‘drops’, timed online sales by blockchain-backed marketplaces like Nifty Gateway, Opensea and Rarible.
Why would I want to own one?
There’s an array of reasons why someone may want to buy a NFT. For some, the reason may be emotional value, because NFTs are seen as collectors items. For others, they are seen as an investment opportunity similar to cryptocurrencies, because the value could increase.
When were NFTs created?
Writer and podcaster Andrew Steinwold traced the origins of NFTs back to 2012, with the creation of the Colored Coins cryptocurrency. But NFTs didn’t move into the mainstream until five years later, when the blockchain game CryptoKitties began selling virtual cats in 2017.
‘I’m selling this song about NFTs as an NFT,’ he stated above a clip of the dance track.
Lyrics from the song included: ‘NFT for your vanity. Computers never sleep. It’s verified. It’s guaranteed.’
The tweet also included a graphic of a trophy with the letters ‘NFT’ on top.
Musk’s announcement quickly sparked a bidding war among moneyed tech aficionados who were hopeful of snapping up a digital artifact from the Tesla founder.
Bidding for the NFT took place on Valuables – a social media network built on blockchain.
Bids reached a staggering $1.1 million within four hours before Musk announced he was rescinding his offer to sell his tweet.
‘Actually, doesn’t feel quite right selling this. Will pass,’ he wrote.
The person who put up $1.1 million to buy Musk’s tweet has been identified as Twitter user @SinaEstavi.
Estavi – who boasts 82,000 Twitter followers – purports to be the CEO of cryptocurrency website CryptoLand.
DailyMail.com has reached out to Estavi for comment on why he decided to splash a seven figure sum on Musk’s NFT.
Musk may have been inspired to sell an NFT by his partner, the musician Grimes.
Earlier this month, Grimes made nearly $6 million in just 20 minutes by selling her digital artworks as NFTs.
The 32-year-old musician sold 10 items from a collection called WarNymph that included dramatic illustrations of winged baby goddesses battling in apocalyptic skies.
Art collector Pablo Rodriguez-Fraile – who has been selling of NFTs – explained their popularity in a recent interview with Business Insider.
He says blockchain technology allows the items to be publicly authenticated as rare or one-of-a-kind, unlike other online items which can be endlessly reproduced.
‘You can go in the Louvre and take a picture of the Mona Lisa and you can have it there, but it doesn’t have any value because it doesn’t have the provenance or the history of the work,’ said art collector Pablo Rodriguez-Fraile, who recently sold a 10-second video for $6.6million.
‘The reality here is that this is very, very valuable because of who is behind it.’
Earlier this month, Grimes made nearly $6 million in just 20 minutes by selling her digital artworks as NFTs
Musk may have been inspired to sell an NFT by his partner, the musician Grimes. The pair are pictured in 2018
NFTs have boomed in popularity amid the COVID-19 pandemic, as many people stay home and spend more time on their computers.
OpenSea, another marketplace for NFTs, saw monthly sales volume grow to $86.3million in February, as of Friday, from $8million in January.
Monthly sales were at $1.5million a year ago, the firm said, pointing to blockchain data.
‘If you spend 10 hours a day on the computer, or eight hours a day in the digital realm, then art in the digital realm makes tonnes of sense – because it is the world,’ said OpenSea’s co-founder Alex Atallah.
But investors warn that although big money is currently flowing into NFTs, the market could represent a price bubble.
Like many new niche investment areas, there is the risk of major losses if the hype dies down, while there could be prime opportunities for fraudsters in a market where many participants operate under pseudonyms.
Nonetheless, auction house Christie’s recently launched its first-ever sale of digital art – a collage of 5,000 pictures which exist solely as an NFT.
The collage – created by a digital artist named Beeple – sold for a staggering $69 million.
Auction house Christie’s recently launched its first-ever sale of digital art – a collage of 5,000 pictures which exist solely as an NFT. The collage – created by a digital artist named Beeple – sold for a staggering $69 million
‘We are in a very unknown territory. In the first 10 minutes of bidding we had more than a hundred bids from 21 bidders and we were at a million dollars,’ said Noah Davis, a specialist in post-war and contemporary art at Christie’s.
At the time the auction was announced, Christie’s – which was was founded in 1766- said it would accept payment in the digital coin Ether as well as traditional money.
‘I think that this moment was inevitable and whenever institutions of any kind try to resist inevitability, it does not work out very well,’ Davis said of accepting crypto payment. ‘And so the best thing you can do is embrace the terrifying.’