By Zachary Scott

In the wake of what can only be described as a global NFT craze, I find myself wondering what more there is to the future of NFTs other than digital art…

Non-fungible tokens (NFTs) and more specifically their smart contracts may prove to have a much deeper and more transformative impact than most casual observers would expect. There is a day on the horizon where NFTs will form the basis of our identities and reflect the characteristics of our individual personalities.

Looking beyond “material” possessions (and not material in the sense of tangible items as we all know that by definition NFTs are not quite this) but material in the sense of valuable digital art of which we have seen many amazing examples. 2021 was the year that NFTs became mainstream, but the more we learn the more we realise there is still a long way to go in the development of this technology with many real-world use cases that will impact our everyday life, on the surface and within.

It's not about what you own but who you can become…

Alex Danco does a truly fantastic job at describing this in Packy McCormick’s Not Boring – Tokengated Commerce and I would highly recommend it for anyone wanting to dive a little deeper. Fundamentally, they discuss how crypto has always been about what you can do and NFTs, what you can own, but there is something more at play here and that is who you can become.

Ownership of an NFT has often been associated with identity but this concept has the potential to play a much bigger role in our daily lives than just being a member of the latest cool trend. NFTs represent a new file format, our digital social identities are rapidly growing and for the first time this measure of culture and community can be neatly packaged in a way that can be just as easily interpreted by computers as it can be by people.

We humans are tribalistic beings, we long for belonging and to be a part of something. As owners of NFTs we will be people with wallets and these wallets can be connected to discord channels, dapps and marketplaces as a means of communicating said identity. "NFTs are a new token of meaning on the internet for 'fit in, and stand out', one of the most important raw ingredients for so many wonderful things in the world - culture, community, commerce" says Alex who is working on what he refers to as Tokengated Commerce, taking this idea of signifying community membership and applying it to consumer experiences.

In the form of digital art NFTs are an output of commerce but following this they can evolve to be an input for commerce. Imagine shopping online but when you connect your wallet the retailer’s platform responds in a way that acknowledges you. This recognition has the power to be leveraged in a way that promotes inclusion far beyond any of the loyalty programs we see currently. The ‘gated’ aspect will gamify the experience to an extent as well, making certain products or real life experiences unlockable dependent on your identity, we have seen the beginning of this already with Coachella utilising rare flower NFTs for specific area access, redemption mechanisms for products and other rare experiences.  In his Three Stages of Adoption, FTX’s Trystan Yver describes how this idea of owning digital items that tie back to real life things in particular is how we will onboard the next wave of adopters. The combination of an increasingly personalised experience and one that plays to scarcity by limiting access and creating a challenge for consumers is one that will have a dramatic impact on everyone in the transition to web3.

Identification and Verification

What makes NFTs so special is their ability to act as a digital identifier that can be controlled using the integrated smart contracts. This in particular is a benefit that can offer wide ranging practical use for individuals in every walk of life. Medical records and personal identification documents being the most obvious. Both of which are traditionally difficult to access and even harder to replace. Putting the control back into the hands of the individual as opposed to the large health institutions would increase confidentiality and allow the individual to dictate the specific information shared when seeking treatment without disclosing personal data that they wish to keep private.

Anything that is unique can be represented digitally and secured to an NFT. Although the most common use for these special tokens has been in the mediums of digital rarities like artwork and collectibles, their ability to act as a digital representation for something could be extended to even us humans.

As adoption increases, we could occupy a world where an individual is issued an NFT birth certificate. Inextricably linked to the individual, this could be the start of establishing a digital record of identification and form the basis for which to link medical records that can be tracked in NFT form.

A similar principle of identification can be applied to products within the manufacturing process. Take car manufacturing for example, by linking each individual part with a non fungible signature, which could be as simple as a QR code, the automotive supply chain would allow the manufacturer to trace the components in a way that in the event of a recall, could save the company billions if dollars each year by reducing the number of vehicles that would need to be recalled.

Warehouse administration is another aspect of the supply chain that has the potential for radical increase in efficiency through the new standards blockchain enables. Inaccurate inventory can be costly for companies and we know all too well the scope for human error in conventional databases. By incorporating a digital identity that can move with the physical item we reduce the inventory related inaccuracies and increase the authenticity of the original, something that is becoming apparent in the luxury goods industry.

Louis Vuitton announced plans to use an NFT optimised supply chain to identify their goods and provide increased transparency throughout the products manufacturing process, adding to the uniqueness and quality. In the past five years we have seen a clear shift in sustainably focused firms and transparency has been a big driver in the promotion of this. As the luxury brands pave the way for what is possible, in the future we may see this authenticity flow down to some more accessible daily products such as clothing or coffee, where us consumers feel strongly about transparency in the entire supply chain process.

The above are mere examples of things that can be easily integrated onto the blockchain via digital twins. Taking this concept of ownership verification there are a plethora of assets with historically clunky proof of ownership systems that we can apply this ideology to. Traditionally, conducting high value asset transactions digitally was uncommon. The process of buying a house can be a stressful experience for most lucky enough to experience it. Consisting of a long winded process with multiple parties involved in substantial paperwork facilitating the deed transfer. The smart contracts that underpin NFTs would allow this asset class and many others that have been notoriously illiquid, to be tokenised and traded as easily as you would trade a cryptocurrency.

Marx Rowan, chief executive officer of Apollo Global Management Inc. said in an episode of “Bloomberg Wealth with David Rubenstein.” “Many of the rails or the technology or the platforms or the systems that support what’s happening in NFT are actually the precursor to changes in our financial system and we ignore them at our peril.”

Work In Fintech's very own Benyamin Ahmed, NFT millionaire at 12 years old and the youngest ever guest lecturer at Oxford University, will be talking more about digital identities and looking at how this generational shift will propel society further into the digital universe at NFT.NYC.

Follow Work In Fintech for more information and to stay up to date as this new technology continues to shape our world.

By Zachary Scott

In the wake of what can only be described as a global NFT craze, I find myself wondering what more there is to the future of NFTs other than digital art…

Non-fungible tokens (NFTs) and more specifically their smart contracts may prove to have a much deeper and more transformative impact than most casual observers would expect. There is a day on the horizon where NFTs will form the basis of our identities and reflect the characteristics of our individual personalities.

Looking beyond “material” possessions (and not material in the sense of tangible items as we all know that by definition NFTs are not quite this) but material in the sense of valuable digital art of which we have seen many amazing examples. 2021 was the year that NFTs became mainstream, but the more we learn the more we realise there is still a long way to go in the development of this technology with many real-world use cases that will impact our everyday life, on the surface and within.

It's not about what you own but who you can become…

Alex Danco does a truly fantastic job at describing this in Packy McCormick’s Not Boring – Tokengated Commerce and I would highly recommend it for anyone wanting to dive a little deeper. Fundamentally, they discuss how crypto has always been about what you can do and NFTs, what you can own, but there is something more at play here and that is who you can become.

Ownership of an NFT has often been associated with identity but this concept has the potential to play a much bigger role in our daily lives than just being a member of the latest cool trend. NFTs represent a new file format, our digital social identities are rapidly growing and for the first time this measure of culture and community can be neatly packaged in a way that can be just as easily interpreted by computers as it can be by people.

We humans are tribalistic beings, we long for belonging and to be a part of something. As owners of NFTs we will be people with wallets and these wallets can be connected to discord channels, dapps and marketplaces as a means of communicating said identity. "NFTs are a new token of meaning on the internet for 'fit in, and stand out', one of the most important raw ingredients for so many wonderful things in the world - culture, community, commerce" says Alex who is working on what he refers to as Tokengated Commerce, taking this idea of signifying community membership and applying it to consumer experiences.

In the form of digital art NFTs are an output of commerce but following this they can evolve to be an input for commerce. Imagine shopping online but when you connect your wallet the retailer’s platform responds in a way that acknowledges you. This recognition has the power to be leveraged in a way that promotes inclusion far beyond any of the loyalty programs we see currently. The ‘gated’ aspect will gamify the experience to an extent as well, making certain products or real life experiences unlockable dependent on your identity, we have seen the beginning of this already with Coachella utilising rare flower NFTs for specific area access, redemption mechanisms for products and other rare experiences.  In his Three Stages of Adoption, FTX’s Trystan Yver describes how this idea of owning digital items that tie back to real life things in particular is how we will onboard the next wave of adopters. The combination of an increasingly personalised experience and one that plays to scarcity by limiting access and creating a challenge for consumers is one that will have a dramatic impact on everyone in the transition to web3.

Identification and Verification

What makes NFTs so special is their ability to act as a digital identifier that can be controlled using the integrated smart contracts. This in particular is a benefit that can offer wide ranging practical use for individuals in every walk of life. Medical records and personal identification documents being the most obvious. Both of which are traditionally difficult to access and even harder to replace. Putting the control back into the hands of the individual as opposed to the large health institutions would increase confidentiality and allow the individual to dictate the specific information shared when seeking treatment without disclosing personal data that they wish to keep private.

Anything that is unique can be represented digitally and secured to an NFT. Although the most common use for these special tokens has been in the mediums of digital rarities like artwork and collectibles, their ability to act as a digital representation for something could be extended to even us humans.

As adoption increases, we could occupy a world where an individual is issued an NFT birth certificate. Inextricably linked to the individual, this could be the start of establishing a digital record of identification and form the basis for which to link medical records that can be tracked in NFT form.

A similar principle of identification can be applied to products within the manufacturing process. Take car manufacturing for example, by linking each individual part with a non fungible signature, which could be as simple as a QR code, the automotive supply chain would allow the manufacturer to trace the components in a way that in the event of a recall, could save the company billions if dollars each year by reducing the number of vehicles that would need to be recalled.

Warehouse administration is another aspect of the supply chain that has the potential for radical increase in efficiency through the new standards blockchain enables. Inaccurate inventory can be costly for companies and we know all too well the scope for human error in conventional databases. By incorporating a digital identity that can move with the physical item we reduce the inventory related inaccuracies and increase the authenticity of the original, something that is becoming apparent in the luxury goods industry.

Louis Vuitton announced plans to use an NFT optimised supply chain to identify their goods and provide increased transparency throughout the products manufacturing process, adding to the uniqueness and quality. In the past five years we have seen a clear shift in sustainably focused firms and transparency has been a big driver in the promotion of this. As the luxury brands pave the way for what is possible, in the future we may see this authenticity flow down to some more accessible daily products such as clothing or coffee, where us consumers feel strongly about transparency in the entire supply chain process.

The above are mere examples of things that can be easily integrated onto the blockchain via digital twins. Taking this concept of ownership verification there are a plethora of assets with historically clunky proof of ownership systems that we can apply this ideology to. Traditionally, conducting high value asset transactions digitally was uncommon. The process of buying a house can be a stressful experience for most lucky enough to experience it. Consisting of a long winded process with multiple parties involved in substantial paperwork facilitating the deed transfer. The smart contracts that underpin NFTs would allow this asset class and many others that have been notoriously illiquid, to be tokenised and traded as easily as you would trade a cryptocurrency.

Marx Rowan, chief executive officer of Apollo Global Management Inc. said in an episode of “Bloomberg Wealth with David Rubenstein.” “Many of the rails or the technology or the platforms or the systems that support what’s happening in NFT are actually the precursor to changes in our financial system and we ignore them at our peril.”

Work In Fintech's very own Benyamin Ahmed, NFT millionaire at 12 years old and the youngest ever guest lecturer at Oxford University, will be talking more about digital identities and looking at how this generational shift will propel society further into the digital universe at NFT.NYC.

Follow Work In Fintech for more information and to stay up to date as this new technology continues to shape our world.