NFT Case Studies Part 2

In the first of a series of articles introducing NFT, we explored how these new digital assets are being used, monetized, and fractionalized. This new form of payment will enable more transparency in many transactions, including intellectual and physical properties. While the use cases for NFT are still developing, there is already much excitement and potential for their future. Interested parties can learn more about NFT by checking out the articles below.

NFTs are certificates of ownership

In the digital age, NFTs can serve as proof of ownership. Unlike a traditional paper document, an NFT cannot be copied and can always be traced back to its creator or artist. This technology has also helped some independent product designers to assert their independence from corporate entities. In fact, NFTs are already being used by startups in the knowledge management space, including Enwoven, which has backing from The New York Times.

NFTs are certificates of ownership for corresponding works. The NFT network tracks the information provided to it constantly, making it impossible to change it without detection. While there is no single blockchain platform that certify NFTs, all of them follow the same underlying principle. The guarantee provided by a blockchain only applies to transactions on its network. The process of issuing an NFT is highly automated and secure. The benefits are numerous.

In addition to digital art, NFTs can establish a custodial care agreement. A digital creator can stipulate that they will be responsible for renewing websites, ensuring that the work will remain available online for the long term. NFTs are a powerful tool for patronizing a favorite artist. Not only does NFT ownership come with bragging rights, but it also allows you to sell it at a later date. The art work is linked to your name and a plaque would be placed below the work.

While many people consider NFTs to be investments, they fall short on the Howey test. The creators of NFTs rarely refer to them as investments, and instead, sell them to raise the price. However, if NFTs do rise in value due to limited supply or high demand, this is a very small portion of the total. The vast majority of NFTs do not pass the Howey test, so the question of whether or not NFTs are securities is yet to be answered.

They are a new way to monetize digital assets

The NFT market enables artists and consumers to share, sell, and trade digital assets. For example, a user can sell their first tweet on NFT for $2.9 million. But NFTs are not limited to digital stickers. Currently, NFTs are available in blockchain games and virtual worlds. Users can buy virtual plots of land in The Sandbox or a hot dog hat in Decentraland. They can even sell a “generic” axe developed for no specific game.

The NFT model allows the creators to sell their digital assets directly to their followers without having to deal with an intermediary. Social media platforms have begun to adapt NFTs to their platform. In fact, TikTok recently launched a collection of digital assets called Top Moments, which will allow users to earn NFT items. For creators and followers, NFTs present an unrivalled opportunity to sell their assets.

Fashion companies are increasingly making use of NFTs as a unique collectible. Last year, Dolce & Gabbana sold a nine-piece NFT collection at auction for $5.6 million. The new model enables brands to expand their creative partnerships. For example, a fashion studio recently collaborated with a talented teen artist to create a pair of virtual sneakers. These virtual sneakers were priced higher than the physical version.

While NFTs are a relatively new model for monetizing digital assets, their ability to change the gaming experience is an enormous opportunity. For example, a famous individual can use NFTs to capitalize on his or her cultural cachet. A former NBA player recently released a NFT collection showcasing his hairstyles. Those who own the rights to this iconic clip could generate fresh revenue from fans.

They can be used as quasi-securities

The recent cryptocurrency boom has made NFTs a popular investment choice. Their recent resurgence has prompted several NFT issuers to sell out in a matter of seconds, commanding purchase prices of seven figures per unit. However, the question remains, should NFTs be considered securities? As with all forms of financial derivatives, the answer is complicated. Ultimately, the answer lies somewhere between a semi-security and a speculative investment.

While many NFTs are not securities under federal securities law, they could be if marketed as such. One case in point would be “fractional” NFTs, which allow investors to share a fractional interest in a security with others. Such an arrangement would qualify as an investment contract under the Howey Test. The case for NFTs that aren’t securities is unclear.

Aside from their potential as quasi-securities, NFTs can also be used to eliminate counterfeiting. As NFTs help trace the movement of goods along a supply chain, they guarantee uniqueness. They’re also applicable to supply chains of luxury fashion brands. They can also help with cost control and help track recyclable materials. If a NFT can help with these issues, it could have a broad application in various industries.

Another example of how NFTs may serve as quasi-securities is when certain projects propose that NFTs act as insurance policies. These insurance policies vary in the type of risk they cover and the premiums they require. Those that offer these policies are able to contribute to the protection pool, and receive proportionately share of the premiums. Then they can sell their shares of the protection pool on secondary markets.

They are being fractionalized to provide more liquidity

Fragmentation of the NFT market could be beneficial for both investors and entrepreneurs. NFTs are highly speculative assets that must be sold to function. But, with the advent of new services and fractionalization, NFTs can now serve as collateral for loans. These new services can facilitate greater liquidity and facilitate investment by smaller investors. However, fracturing isn’t without risks.

The process of fractionation can help cryptocurrencies by facilitating the creation of a liquid secondary market for NFTs. Fractionalization can also increase exit liquidity for NFT holders. It is possible to manipulate liquidity through speculation or purposefully remove it all together. This can create a situation where prices rise quickly but the buyer pays the wrong price. With fractionalization, the initial NFT holder owns most of the supply from the start.

Fractionalization makes expensive NFTs more affordable for many investors. It also allows fractional owners to sell for a lower price than the others in the group without affecting the value of other fractions. Fractionalization allows for more efficient price discovery, which is the process of determining the right price for an asset in the market. The key to NFT success is making them affordable to more people.

Fractional ownership of NFTs can create some issues. If two different owners own 50% of it, the owner of the other half of the token cannot sell the remaining 50% in his name. However, if this fractionalization happens, the owner may face problems later if his buyer doesn’t want to sell his fraction. This is where the protocol becomes important. When Fractionalization is done properly, fractional NFTs will become more valuable and desirable for investors.

They are being used to monetize fashion

The first fashion brand to use NFTs was Auroboros. The company created virtual couture for Augmented Reality that consumers can wear. Today, NFTs have become an inevitable part of the fashion industry, from designers to retailers. NFTs can help reduce the cost of physical inventory, and allow brands to reach new audiences, allowing them to finance multiple collections at once. In addition to the potential savings to brands, NFTs can also prevent counterfeit products.

While traditional brands may be more accustomed to selling in physical stores, luxury fashion brands are also getting in on the action. Luxury fashion house Dolce & Gabbana made $6 million in one week from its hybrid launch, and toy company Mattel has launched Hot Wheels NFTs this fall. This is just the beginning of how fashion can be monetized through NFTs.

Another way NFTs can be used to monetize fashion is by letting consumers own their own history. By purchasing NFTs, consumers can also unlock exclusive benefits of the brand. This creates a win-win-win situation for both consumers and brands. NFTs will not just be a fad for the future, but should be part of your marketing mix. So if you’re an established brand, why not explore the possibilities of a new revenue stream?

While NFTs have become a viable option for retailers, celebrities have also begun adopting the technology. For example, former NBA star Dennis Rodman has released a collection of NFTs celebrating his various hairstyles. Whether you’re a fashion designer or a consumer, NFTs offer the opportunity to leverage cultural cachet and increase fan engagement. You can even make money by selling your NFTs, allowing your brand to be involved in a social good.