There has been quite a lot of chatter about NFTs (Non-Fungible Tokens) in the Metaverse context. How crypto + NFT democratizes trade and allows us to own digital art, avatar decors and land in the Metaverse. You could be buying land in the Decentraland buy Gucci clothing for your Roblox avatars and set up a business front in these virtual worlds to enable your customers to buy digital goods (NFTs). Gaming industry has been ahead of time in these for a long time: enabling gamers to buy digital items and outfits for your character using real money – albeit these have been available in that specific game only.
Of course when you just buy digital goods that is good for sustainability. But you don’t get to hold anything physical in your hands from that transaction. It can be a good (environment & physcial resources) or bad (it exists only virtually) thing depending on your viewpoints and needs.
The next level with NFTs is that you do get also physical item when you purchase the NFT. This trade has already examples like buying a Corvette in an auction for NFT. The highest bid for NFT gets also the car and the NFT & car are linked together. While from the legal perspective there may be some real world steps like the car registration and so on this is a good experiment and showcase how you can use NFTs. The ownership of something can be linked to the ownership of NFT token.
What this can mean in the future?
This time it is an experiment, the next times will be just routine when using crypto-money (ETH or others) to buy something instead of the credit card. And the following step can be that we might be skipping some needs for people needed to make the purchase legimite. How about buying a house, land or a boat NFT and that would also transfer you the ownership of that specific physical property? The transaction would be legal as soon as the NFT sale has been accepted by the blockchain?
When NFT tokens are bound to something physcial it can open up interesting possibilities for retail and commerce. Would a hotel room have NFTs for specific nights? How about a week at resort? Flight at Emirates business class? T-shirts, shoes and other clothes? It is going to be shadowy line in this. Let’s say you buy a t-short with NFT and you get the shirt. You decide to sell it forward in person with someone – but you don’t mention about the NFT tied to that. Who will own the shirt? Who owns the NFT or the person having the physical item? As this is wild west at the moment, we are seeing experiments but in the near future we can expect more questions, dilemma and finally legislation around these matters as it is inevitable to come.
Combined with NFT buying experience people want to see what they are buying. Perhaps a walk-in hotel room to see which room you want? Emirates business class check-in experiences and see facilities in the plane while digital crew presents what additional options you might have. The whole package will be a NFT you purchase and against that token you can board & enjoy the trip. See the t-shirt on top of your avatar first? Take a fully immersive view on the shirt – instead of typical 2D pictures we get today when we are shopping today. Atmosphere, music and other ways to influence your mind would be there. How cool it would look on you?
In the future, with more of our property being in NFT tokens, we can also face serious issues with scamming and frauds. Today you can get your account or cards emptied, or your identity taken, if you are a victim of cyber crime. In the future you might loose your car and house as well. What about marriage agreements – could you end up being married to someone else when hackers play a trick or scam at you? And while we can look at the dystopic pessimistic possibilities we can also think about positive outcomes how this can enable us to buy something in a different country and own a property there – anonymously.
While the Corvette is a great example and experiment, I am thinking that some services and smart devices may have the ownership tied to NFT in the future first. How about instead of buying something with your credit card you use ETH to buy a NFT for editor tool? When you connect that NFT, via your possessions wallet, to the editor tool you get the access. You might also sell that foward and the other user gets access. Without having to use the current model of registering, terminating subscription and so on. Or how about a smart watch or camera? No NFT, no joy. This is already reality with digital services where you buy virtual land – the token is your proof of ownership. With digital art it may be more like a “I have a proof this is the original one” but in some areas you need to have the verified token in your connected crypto wallet to verify who you are.
Since countries do want to taxing, control and also have laws who and how can buy properties, registration and licensing may also be needed on certain transactions since won’t be mainstream so soon – and that is good thing for now. There needs to be laws and practices as well – but it is interesting to think how blockchain, cryptos and NFTs can tie together business, processes and consumers for a new kind of experiences.