It only makes sense that advertising and marketing technology should heed the call. Immersive mobile advertising campaigns that use NFTs can be distributed programmatically across various platforms. Brands can use NFT technology to provide personalized gifts, vouchers or more to their customers. For example, Taco Bell recently sold NFTs for digital taco art (and donated 100% of the profits to Taco Bell Foundation, Inc.). This technology can help drive user engagement for brands and can be attributed back to a user or paid media channel without the need for a cookie. For a specific subset of consumers, it’s a win-win situation for both them and advertisers.
NFTs’ main value proposition is that by creating a unique, blockchain-backed record of each unit of creative work, they can not just encode the sense of its authenticity and scarcity but also enable artists to lay down and enforce the rules around copyright transfer, usage and monetization. G-J van Rooyen, co-founder of blockchain content protection firm Custos Media Technologies, commented to Cointelegraph:
“First, NFTs allow us to securely trace the transfer of rights — in the same way as a Bitcoin payment securely traces the transfer of funds. Second, NFTs can provide perpetual support to creators. For example, an NFT could specify that creators should be rewarded each time an asset is resold at a higher value.”
Most importantly, as with any new emerging technology-enabled business model, companies should pilot NFTs with cryptocurrency and blockchain. Start with creating a digital wallet and fill it with some Ether, the cryptocurrency that many NFT marketplaces use (because they use the Ethereum blockchain). There are a number of sites that sell cryptocurrency, including Ether. Some of the more popular sites are Coinbase and now PayPal. Once a company has purchased some Ether they can proceed to OpenSea (or other NFT marketplaces, like Rarible or SuperRare), which is where lots of digital things are for sale. Companies can buy some things on OpenSea (with their Ether) – and then sell them – all in the spirit of learning how it all works. They can then browse their own portfolios for something to sell, or consider creating something they can sell.
Designers predict that NFTs will prompt an explosion of new works designed to make the most of digital technologies such as augmented and virtual reality.
Christodolou is experimenting with time-based programmable assets – digital images that evolve over time or react to its owner – as is Canadian lighting brand Bocci.
The company, which is currently selling DIY instructions for a candle as an NFT, is investigating how the technology can reflect the production process behind a product.
“Time-based programmable assets intrigue me because they might interweave into these processes and contribute to them,” Bocci founder Omer Arbel told Dezeen.
With blockchain innovation, one can easily and cheaply package a product that provides exposure to a diverse basket of assets. What if you want to buy or sell an old-school REIT and a parcel of virtual land to the same counterparty at the same time? You can use the technology to efficiently create a product with a completely different risk profile for those who are seeking returns uncorrelated to traditional metrics.
NFTs – which are essentially a tool that uses blockchain technology to provide proof of ownership of a digital asset such as an image, audio clip or a tweet – are currently a fringe item used primarily by tech enthusiasts and artists, but experts say potential uses for the tokens are nearly limitless, including the proof of ownership of assets such as cars, real estate or just about anything of value.
A non-fungible token is certified on the blockchain (the same technology that ensures the security of cryptocurrencies like Bitcoin), and whoever owns the NFT is deemed the original owner of the asset.
While legacy finance is losing the people’s trust, decentralized finance is becoming the fair and deserved future of money.
Trending away from institutional authority is also evident in the explosive growth of decentralized finance, or DeFi. By using decentralized applications on the blockchain, DeFi allows individuals to lend or borrow funds, trade coins and earn interest on savings. Their transactions are governed by smart contracts, embedded in the software; no bank, brokerage or exchange is required.
Blockchain has come a long way since its 2008 debut as the ingenious technology underlying Bitcoin. Today companies and governments the world over are exploring new applications in which blockchains track, not the flow of digital currency, but things and events in the real world. But this tether to reality is enterprise blockchain’s Achilles heel.
NFTs have already made significant inroads into the luxury and gaming industries, and have plenty of room to grow beyond these initial applications. The art sector will continue to be an important segment of the overall NFT market and is likely to gradually reach maturity over the next couple of years, although it is likely to be surpassed by other digital certificate applications like trademarks and patents, training and upskilling certificates.