DC Fandome said – sign up and get a special NFT just for you! Tweet it, and get another one! Well, I’m just about to buy my Lambo, because I have an NFT and I’m gonna be RICH.

Non-Fungible Tokens, or NFTs, are entries into a blockchain ledger that associate your name with a bit of information in that ledger, usually a pointer to some object on the web, plus some meta-information. My NFT was for a spinning GIF of a Batman comic cover, rendered as if it were a label for a 3 1/2" floppy disk.

Do I own the Batman cover? Do I own the spinning GIF? Am I legally allowed to display the spinning GIF anywhere? Can I give the NFT to anyone else? Do I have any rights to anything at all?

Let’s find out by reading the 12 page agreement regarding the use of this spinning GIF that everyone who receives one of these NFTs explicitly agrees to:

A representation of the metadata for my NFT

Can I transfer this NFT to my own, personal wallet?

No. All the NFTs given away here are kept by Palm.io (who are running this for DC) in a “custodial wallet”, which means the NFT you believe you own, you can’t touch or examine. (Remember, the spinning GIF is not the NFT. The NFT is the pointer to it stored in the digital wallet.) DC may, at some point in the future, allow you to take your NFT off their service, or they may not.

If my NFT disappears, can I get it back?

No. If anything at all makes it impossible for me to view my NFT, I cannot hold them responsible. My continued access to my NFT is at their whim.

Is my NFT taxable?

Yes. If I live in a jurisdiction that taxes these sorts of elements, then I will be liable for that tax. The fact that these NFTs are worthless means they likely won’t accrue any tax obligations, but in a bizarre series of events where these become worth something, I could owe tax.

Can I display my NFT on my blog?

Not legally. Nor can I display it on one of those electronic photo displayers for the public to see. Nor can I claim I own any element of the NFT, Batman, courts, owls, the fact that something spins – I have no rights whatsoever to the GIF or the contents of the GIF. However, I do have explicit permission to view the NFT myself, as long as doing so does not earn me any money. Although my blog is not now monetized, at some point in the future I might choose to do so, and at that time displaying the NFT metadata – the spinning GIF – here would be a copyright violation.

Can I make a snapshot of one frame of the NFT metadata (the spinning disk), and show that?

No. It is a violation of the terms to change the NFT metadata (the spinning disk GIF), or to make derivative works from it. Even using the heavily processed image of a small part of the actual cover as the header image for this post is technically a derivative work.

Can I show other people all the cool spinny NFT metadata that I own?

No. I can’t see any way of sharing my collection with anyone else. So, with all these DC NFTs I collect, I cannot share them with anyone; it’s just a little collection that I have to keep secret.

Is this really on the Etherium blockchain?

The wallet that Palm NFT Studio uses to keep track of the ownership of the NFTs is listed on the Ethereum blockchain at 0x19d4f9a260af1d7e0e99a32dbe418956af875c25. I do not know enough about Ethereum and how to see how they are storing the ownership records on the blockchain, but as of this writing, the Ethereum the wallet contains is worth about $223.

Update: I Did Some Research!

Palm.io is running their own little Ethereum-compatible operation; they’re calling it a “side chain” that is run off their own PALM tokens, which are not publicly sold. I would assume that these PALM tokens are backed by Ethereum. Short answer: my NFTs are not on the public Ethereum block chain. PALM runs something called a “PALM Bridge” for communicating into and out of the Ethereum block chain; my guess is that they batch transactions to save on gas fees. You can read more about it on their FAQ.

If I make DC angry and they terminate my account, can I keep the NFT?

Ha ha ha.

Is this a scam?

I paid no money for this. What I was given is worthless. I don’t see any store attached where I could pay actual money to buy this worthless link to an asset over which I have no rights, so… it’s a toy. Maybe there’s still people who would get excited about this. I thought NFTs were stupid back when I first heard about them a year ago, and nothing that has happened since then has changed my mind.

BTW, that spinning Atari Asteroids box that was worth (heh) $15,000 a year ago is apparently worth about $45 now. Given the price history, it never actually was transferred for that price. One user I clicked on has apparently lost $7,500 by trading a wide variety of NFTs that point to ugly spinning GIFs.

There may one day be a case to be made for NFTs, but this DC Fandome thing most decidedly not that. But for better or for worse, my e-mail address is now irrevocably* associated with a pointer to some metadata in a blockchain somewhere that refers to an image of a spinning disk to which I have no rights whatsoever.

  • (until they choose to revoke it)

So the TL;DR is…?

I was given, for free, two NFTs that point to two spinning GIFs that I can’t show anyone. The valueless items I was given can be taken away at any time. If, somehow, they should ever have any value, then I can be taxed for possessing them, and it can be taken away from me for any reason or no reason. I cannot transfer “my” NFTs to anyone, or even transfer “my” NFTs to a wallet under my own control. I don’t know if the record of my ownership was, or ever will be, actually recorded on the blockchain. My understanding is that interacting with the Ethereum blockchain is expensive, and I very much doubt anyone is spending real money on this.

How was this supposed to get me excited about the whole NFT craze, again?