NFTs for Fashion: Enthusiasm or Opportunity?
Updated: Nov 22, 2021
You have definitely come across the news about NFT (Non-fungible token) lately. The NFT craze reached new heights in recent weeks when Christie's, a 255-year-old auction house in the UK, sold a jpeg file of a digital artist known as Beeple for $ 69.3 million.
So what is this NFT?
NFTs allow you to buy and sell ownership of unique digital items and track who owns them using the blockchain. NFT stands for "immutable tokens" and can technically include anything digital, including artwork, animated GIFs, songs, or items in video games. An NFT can be one-of-a-kind like a real-life painting or a copy of many copies like trading cards, but the blockchain keeps track of who holds the file.
Some saw this event as a speculation spree, while others saw a historical turning point. However, there is growing interest in unique digital assets, "immutable tokens". Proponents of NFTs say they've removed an important barrier to virtual products that are easily copied, valued and collected, such as physical objects.
This is a flying cartoon cat with a unique version of the Nyan Cat, a Pop-Tart body and a rainbow trail, that has been seen and shared hundreds of millions of times since it was uploaded to YouTube almost a decade ago.
It was sold for $ 580,000 last month.
In sports, NBA Top Shot, a partnership between the NBA and blockchain company Dapper Labs, has sold virtual basketball cards, each containing short video clips for thousands of dollars. An NFT showing the LeBron James dunk was recently sold for $ 208,000.
Two weeks ago, the collaboration between 18-year-old crypto artist Fewocious and virtual sneakers brand RTFKT Studios generated $ 3.1 million in 7 minutes. "It's not just a trend or something new, it's a real power shift," said Benoit Pagotto, co-founder and CEO of RTFKT. says. I recommend you to review their website. You can share your opinion as a comment .. :)
Almost anything can be given in NFT, as shown by those who have sold in the past few weeks. In the fashion industry, NFTs can expand beyond products to photos, shows, interviews and social media posts.
While the NFT market is still evolving, the potential for brands to leverage it through a variety of digital apparel, accessories, and other products means it can continue to grow as a force in the industry. Still, there are challenges and risks for brands to consider before releasing NFTs.
Are NFTs a real opportunity for the fashion industry or just a fad?
While the NFT craze is making the headlines, there seems to be a long way for consumers to buy NFTs instead of Birkin bags. Few fashion companies have invested heavily in the required technology, and most of them are not naturally suited to the gaming and VR worlds where NFTs thrive.
Creating a digital product requires a similar level of craftsmanship and experience to physical parts that many brands need to outsource to create digital products that compete with their physical products. If fashion brands want to adopt NFTs, they will need to start serving a new demographic with different preferences.
We cannot deny that this area is overly exaggerated by speculators. It is obvious that during the pandemic, those seeking innovation and entertainment are pouring money. But there are strong signs that NFTs can keep their strength.
From pictures to baseball cards, people have long attributed emotional and social value to physical objects that weigh much more than their material worth. After all, canvas and paint have no value compared to Picasso. The same goes for fashion items such as handbags and sneakers.
Gathering these objects on which we enjoy some kind of domination, transforming them into extensions of ourselves, is a fundamentally human activity that is deeply connected with how we shape and transmit our identities. As we live most of our lives online everywhere, from social media to video games, the concept of collecting and displaying digital objects seems likely to grow.
So how should Fashion brands react?
In fact, many of them are cautious. Not a bad idea considering how fast the field is changing. For those willing to experiment, NFTs can be printed with a range of creative assets (a designer's sketch or a memorable memoir) and used to drive a variety of marketing outcomes, from being seen as "innovative" to deepening fan loyalty.
Ian Rogers, consultant for LVMH (Louis Vuitton), said, "It is natural that luxury customers now have digital lives and want to include products in those lives. The idea of buying a luxury handbag and bringing its digital representation to a video game or other digital medium is not far off." says.
NFTs linked to physical goods can also help fight counterfeiting and serve as proof of authenticity. They can also have a transformative effect on the resale market. This is because it can also create a contract that manages the future uses of the blockchain that validates them in NFTs. In the case of Beeple, the artist is preparing to earn 10 percent in royalties every time one of his NFTs is sold on the secondary market.
And for handbags and sneakers, what if the product comes with NFTs that guarantee the brand's copyright every time it changes hands?
While direct immersion in digital art may be attractive to fashion brands looking to create marketing buzz, NFT strategies linked to physical products can generate much greater value for the industry.
Is NFT sustainable?
There is greater concern about the NFT market. According to a study from Cambridge University, printing assets on the blockchain requires a significant amount of energy use.
For example, the cryptocurrency Bitcoin uses more electricity in a year than the entire country of Argentina. The greenhouse gas emissions of NFTs are also not fully explained.
It is not known whether NFTs will be Enthusiasm or Opportunity, but;
Crypto art can be made more sustainable with Leaner and Greener NFTs.