05 NFT use cases that will rule in 2023
Over the past year, a lot has changed in the NFT industry. NFTs were prosperous in 2021 but were driven to mature in 2022 by the bear market. Many investors and industry experts instantly remained silent when the million-dollar profits stopped coming in, but the NFT sector as a whole developed. As collectibles and significant profile picture projects (PFP projects) started to lose market sway, other commonly disregarded use cases began to hit stride.
But we’re not simply referring to photography NFT editions going viral or Sound.xyz music NFT secondary sales surpassing $5 million. While there is little doubt that these are huge successes for artists, advancements in blockchain technology and a move from Web2 to Web3 have also helped to identify a number of compelling NFT use cases that have the potential to one day completely transform the metaverse. It would undoubtedly be beneficial to keep an eye on these developing areas in 2023.
Ticketing & proof of attendance
NFT ticketing is conceivably one of the NFT market’s most underappreciated segments. NFT ticketing is exactly what it sounds like: tickets in the form of an NFT living on a blockchain that serve as admission passes for any live (or even virtual) event. It is widely seen as being extremely advantageous for the future of live events.
NFT tickets have a number of benefits for both ticket issuers and recipients. Issuers can retain a more detailed record of attendance data by using the blockchain as a ledger while also interacting with ticket buyers in a new and unique way by using NFTs. Issuers can also quickly issue notifications, organize unforeseen prizes, create token-gated websites and services, and more by gathering information on the owners of a certain NFT ticket.
Even while NFT ticketing and Proof of Attendance Protocols (POAPs) can seem like a lighthearted reward for attendees, they have helped project creators maintain track of their early buyers. It wouldn’t be unreasonable to claim that POAPs and NFT tickets have an impact on how we perceive fans on Web3.
While it’s true that PFP projects and NFT-based memberships both grew and expanded at the same time, these memberships have subsequently matured into a distinct market segment. These kinds of NFTs are typically used by brands, and they serve as access keys to unlock incentives and prizes for their holders. NFT memberships are sometimes enforced by “token-gating,” which employs blockchain technology to confirm ownership of an NFT and give holders access to any member-only benefits on offer. This may be done in Discord servers, during live or recorded events, and in other places.
The Bored Ape Yacht Club is one of the earliest examples of NFT memberships. Holders of BAYC NFTs get access to merchandise drops, music festivals, upcoming NFT releases, and much more simply by being the owner of a BAYC NFT. The most ambitious membership initiatives continue to be LinksDAO, LoudPunx, and Flyfish Club, while platforms like Friends With Benefits and OneOf have evolved into models for businesses wishing to introduce membership passes.
Soulbound Tokens (SBTs) are non-transferable NFTs, which are perfect for managing permanent records. SBTs could offer us a more effective approach to validate crucial information on the blockchain rather than storing susceptible paper records to be passed down through the generations.
However, these NFTs, which were first proposed by Vitalik Buterin, co-founder of Ethereum, are limited to a particular use case — the replacement of paper records. Should SBTs go into effect as planned, they would have a tremendous impact on our daily lives since they are intended to serve as a full suite of tools for internet users to preserve and defend their identities. SBTs allow for the creation of NFTs with immutable and non-transferable ownership from a variety of data types, including criminal records, academic accomplishments, alumni status, work histories, and everything in between.
Although it’s possible that SBTs won’t be practical on a large scale until a fully decentralized society is realized, there is growing evidence to suggest that this might happen as early as 2023. And where? Well, in addition to Buterin himself implying that they might (have been) adopted by late 2022, businesses like Moonpay have already launched initiatives similar to SBTs. Perhaps the first successful real-world use case is just a question of time.
Physical + digital = Phygital?
The NFT market saw an increase in “phygital” items in 2022. As a merging of the physical and digital worlds, phygital has added even another layer to the idea of digital ownership by enabling creators to convert their physical works into NFTs and vice versa. Although the term “phygital” has drawn criticism for having harsh phonetics and being a simple portmanteau, the success of such goods cannot be disputed.
Phygital items come in a range of shapes and sizes. The line between physical and digital continues to become hazier and hazier for Web3 artists across a range of products, including toys, collectibles, and even more traditional forms of art like sculpture and paintings. Wearables, however, have become one of the most well-liked use cases to come from this new industry area. Companies like 9dcc and RTFKT, who continue to make shoes, shirts, and other items of clothing driven by NFT, serve as the best examples of this.
Wearable digital goods have been around for a while thanks to video games like Fortnite, despite their somewhat futuristic feel. In fact, the Fortnite skins were what first motivated Gmoney, the founder of 9dcc, to delve into the world of digital treasures. He recognized the promise of digital ownership and the importance of the next generation realizing that potential. If financial behemoths like him and fashion powerhouses like Nike are keeping an eye on phygital, the rest of Web3 would be well to follow the trend.
Whether you like it or not, artificial intelligence is a reality that seems set to endure. The AI boom we’re currently seeing feels similar to, if not bigger than, the initial NFT boom of 2021, with technologies like ChatGPT blooming across almost every field and AI-generated art becoming a popular and divisive topic among online forums.
However, it is almost certain that the impact of AI on society as a whole will be greater than that of NFTs at this point. Naturally, this also relates to how it impacts Web3. In truth, a number of well-known creators in the NFT sector already integrate AI collaboration into their work.
In the 2023 NFT market, the five use cases listed above are unquestionably common, regardless of profitability or speculation. It’s possible for some to fail, for others to entirely dominate the market, or for some unanticipated event to occur that will further alter the ecosystem. But even if only somewhat, each of these instances of NFT innovation has surely helped shift this trend from a specialized to an extensive level.
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Disclaimer: The information herein is for educational purposes only and should not be considered financial, investment, or trading advice. Please conduct your own research and due diligence before making investment decisions. You understand that you are using the Information provided at your own risk.