NFTs (non-fungible tokens) are all over the news – and for good reason. If you aren’t sure what an NFT is, or why everyone is talking about them, consider a brief introduction like this. For us, we are happy to see this implementation of blockchain, because it makes so much sense.
Digital art, similar to the creative we use in many of our clients’ ads, is not easy to create. It takes training and experience, a certain eye- and a lot of time. Yet, it’s infinitely reproducible. Screenshot, copy, paste, repost, download- all of these actions are simple things we do when we want to capture something [often to reshare] online, but few think of it as digital theft. Just as no one thinks of going to a museum, seeing something you like, and taking a picture on your phone; as stealing the physical piece of art. However, when you go to a museum there is a name on the plaques, beneath the titles – the name of the owner. Someone owns this painting and it’s on loan. What about a digital piece of art? How do we prove ownership of that? How do we trade it? This is where the blockchain comes in- keeping a record of ownership in the ledger, serving as an ultimate source of truth (when you can’t physically hold on to something to show ownership).
For us, this implementation of the blockchain is a no-brainer and something that the regular art market should consider as forgeries get better and better. The interesting and the most exciting part is the value associated with some NFTs. There are established artists like Beeple and Kings of Leon whose NFT value sky-rocketed right away- for these, we anticipate some correction. But what about the no-name artists cranking out 8-bit drawings (like Pizza Hut)? We think the bubble will burst and that ultimately, the artists and brands that will find success with this platform will be offering unique and memorable digital pieces.
What about digital creative that isn’t considered “art”? We know that this has value- we pay photographers, graphic designers, videographers, and the like to create amazing assets for the brands we work with. But can this type of asset be traded as an NFT? It’s not like selling and trading a tweet, this would be trading a high-value brand asset like an advertisement. How much would you pay to own the original 1922 French Coca-Cola Polar Bear ad? Will there be a large secondary market for these types of NFTs?
We are just seeing the start of the potential that NFTs have as an asset class as well as to deepen the human connection to all forms of digital art, performances, communication and even to brands. From NBA Top Shot to video games and fashion, NFTs provide a new avenue for established brands to reach their audience – for the short and long-term.
If you are curious about how blockchain technology can enhance or accelerate your business as it has in the art industry, contact us today.