Before the pandemic, NFTs boomed on the crypto market and have since been adopted by numerous companies to appeal to the demand. The fashion industry took advantage of this new engaging strategy and introduced it within the sector through Augmented reality clothing, Metaverse fashion shows and virtual stores. Brands like Dolce & Gabbana, Gucci and Burberry were the most open to using NFTs for their customers, and it showed how versatile NFTs are.
But influencing an entire market is a long road because handling NFTs requires hiring someone specialized in blockchain technology, network connection and cryptocurrency transactions. Of course, those who want to buy their favorite clothing under an NFT form must check where to buy Ethereum because most of these online environments are built on the Ethereum blockchain. Hence, they mainly accept Ether payments, but some have expanded to Bitcoin and even Dogecoin tokens.
Regardless, it is safe to say that NFTs bring a total change in the business setting, so we must explore it thoroughly to seek innovation. Here’s how.
NFTs in art and luxury brands
Of course, NFTs, being unique tokens and appreciated for their value due to demand and scarcity, are linked to luxury brands and artistic assets because they share similar values. That’s why NFTs are used mainly by artists and creators to make an income from their creativity and market offers. If you have not heard about it yet, know that some artistic NFTs are being sold for millions of dollars. For example, the “Everydays: The First 5,000 Days” NFT collection was sold at an auction for $69.4 million, and people are still not over the most expensive NFT.
But there is an entire backstory behind the NFT, which applies to most of them because buying and selling such assets has an intrinsic value for investors and artists. That is why if luxury companies like Gucci adopt the idea, the NFT’s value increases considerably.
In fashion, NFTs are presented as digital collectibles and wearables in the form of fractional token ownership that can be bought and used only by one individual at a time. Some companies collaborate with social media platforms to expand their approach, such as Nike, which worked with Snapchat so users could visualize the NFT sneaker from the 20,000 tokens collection.
NFTs for assessing documents and certificates
Besides entertainment, NFTs can be helpful in serious domains, such as documentarian, certification and identification due to their seamless features. That is due to their underlying smart contract feature that can later be tracked, improving transparency and reliability for both parties. These NFTs can be used for academic certificates, medical records and any document that can be tokenized.
Numerous institutions leveraged NFTs for certification and identification. For instance, Duke University provides NFT certificates for students following courses in blockchain fundamentals. Another example includes Romania’s National Institute for Research and Development in Informatics created an NFT marketplace for handling government documents.
NFT documents for vaccine passports were tested during the pandemic by the Republic of San Marino. Their approach was not thoroughly applied further as CoViD-19 soon ended, especially since the subject was controversial in many ways back then, but now it could be re-opened and improved. NFTs for future vaccine passports can reduce counterfeits and streamline authenticating vaccine documents faster and more efficiently, helping medical staff.
NFTs for real estate
Regarding usability, real estate has the most advantages of using NFTs because the industry’s applications include both the real and virtual worlds. Indeed, when it comes to real-world situations, NFTs are in development, but their efficiency in checking titles and ownership history is evident. People could register any real-world asset and tokenize it, from a house to an office, which makes transfers faster and safer on the blockchain.
However, NFTs in virtual real estate show how prominent they are in the industry. The development of blockchain-based games, such as Decentraland, provided the perfect ecosystem for exchanging virtual land parcels, where owners quickly identify. Virtual real estate is incredibly efficient with the help of NFTs due to transparent and rapid transactions recorded on a decentralized ledger, usually Ethereum, where crypto enthusiasts can gather a collection of houses and virtual properties in their portfolio and improve diversification.
NFTs for finance sectors
NFTs bring what is best in the finance industry by transferring virtual assets on the blockchain. At the same time, NFTs support a private and secure recording of information and financials due to cryptographic technology. These features alone improve the financial industry that struggles to keep users’ data safe and well-organized.
There is also room for NFT banking applications, which would employ better security than traditional banking systems. At the same time, anyone could create an account on the NFT platform, therefore providing equal services for communities and increasing accessibility among less-fortunate users. However, there is a need for more user-friendly technology and broader acceptance because, for now, only a few countries support it.
A more approachable method of introducing NFTs in the financial sector is through DeFi (decentralized finance), the latest ecosystem in which users benefit from high-tech financial services. DeFi is the best alternative to traditional banks and brokerages because no third parties are involved, and users are in better control of their finances.
Hence, DeFi and NFTs can work together and offer borrowing and lending programs, forecasting NFTs markets or managing real estate assets. Even NFT crowdfunding is slowly improving, with institutions like UNICEF taking advantage of these technologies to gather resources for those in need. NFTs in crowdfunding help with transparency, better asset distribution and are censorship-resistant, so they can be used to avoid scams and protect contributors.
Final considerations
When they appeared on the market, NFTs were only seen as a way for entertainers and artists to expand their knowledge area. However, it is discovered that NFTs are actually valuable for various sectors of the real world, from healthcare real estate to documentation and certification. Hence, experts and developers should focus on their introduction to the physical world because the virtual world is already developing with the help of NFTs.
