No doubt, NFTs (Non-fungible tokens) also represents next-generation capital and digital fan club, amongst other things. Apparently, the NFT wave started with the creative industry. It’s revolutionising the creative industry. Still, there is more to it. In this post, we will share other use cases of NFTs, especially for organizations or businesses. With daily active users of between 10,000 and 20,000, NFT is still in its early stages. The crypto assets’ sales surged to $2.5 billion in the first half of 2021, a 2,100% increase from the fourth quarter of 2020.
The adoption of NFT is rapidly rising. It changes digital work into unique, verifiable assets that can be traded through blockchain technology. The current common use case of NFTs is digital artwork. Yet, this is just the surface.
However, NFT is beyond art. It’s a technology of trust and a connection between the NFT producer and the NFT consumer.
The underlying technology of NFT, the blockchain, is essentially a database of verified transactions.
Unlike traditional ownership transactions, which rely on layers of middlemen, NFTs have changed the rules of ownership by acting as an authenticator and a credible source of ownership validation on a blockchain.
An NFT is also seen as a certificate of authenticity, a deed, or proof confirming you own certain rights. It’s essentially a digital certificate that allows you to prove that you are the owner of the asset.
NFT buyers can derive good value when they understand how to utilise and monetise the NFT. In part 3 of this NFT series, we outlined how to find the utility value of an NFT.
The NFT models
- In the creative industry, artists or musicians can now attach stipulations to an NFT that ensure they get some of the proceeds every time it is resold. This way, they benefit if their work increases in value. It’s like a small artist who sells his work for $300 and puts a condition in the smart contract that whenever someone resells any of his works in the collection, he gets royalties.
All this without a third-party organization that takes heavy management or agent fees. It’s a direct-to-consumer business model. These NFTs, which are tokens of trust on a smart contract, can be used to ensure that both parties honour their agreements.
- NFTs are also helping companies brand and market themselves to consumers in new ways. With NFTs, new experiences are possible. In part 2, I discussed that “Project owners are also selling NFT collections to raise funds for their ventures. As an owner of one of these PFP collections, you can be entitled to revenue sharing in the venture, tickets to events, right of passage into things, merchandise dropping, airdrops, sharing in royalties, video game applications, entitlement to other artworks, collateral for loans, etc. Your benefits are defined by the creator of the NFT project. “
I also added, “It represents a new avenue for artists to connect to fans who may not normally be their fans. They’ve reached a whole new level of fandom. Artists connect to fans in a collection (like metaverse). When Snoop bought the virtual mansion on the Sandbox metaverse, he connected to fans on that metaverse. When people see a celebrity in the same collection as them, they become fans of that celebrity.”
- In education, NFT can be used to track the authenticity of a certificate and to prove that a certificate was issued by an institution. It minimizes fraud. Citizens can track and verify the academic certificates of politicians and public officeholders.
- It can be used for medical records. The use cases are enormous. An NFT is a collection in a smart contract, meaning it can be programmed to follow a certain logic. A medical record issuer can authorize certain pieces of the collection to be released based on specific conditions.
- NFTs can also revolutionize wills, whereby upon the death of a person, their wills can be executed without a lawyer. This way, sabotage is mitigated.
Conclusion
In other parts of this series, I discussed how NFTs are applied to the entertainment industry, gaming, and event tickets. The application of NFTs in gaming is incredible. We’d address its use cases for B2B over time.
We are still in the early stages of NFTs. Companies and the market will shape the future of NFT. Brands need to start thinking about their NFT strategy.
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