⚡ Zash Community Update 10: Creator Memo: NFT's and Physical Assets
Building the future of retail investing
Dear All,
Happy Tuesday! Each week we update you on our latest happenings, developments, product updates, and more.
Why? Community is at the heart of our product. We want you to be part of the crucial steps of our product development. You can read all of our previous Community Updates here.
Product Development ⚒️📲
As a fully distributed team, we wanted to share this delightful video tool we are using: Around (which we feel won't end up in the post-pandemic graveyard of productivity tools!) Here’s a little screenshot of our weekly Show & Tell, sharing ideas where we share our built features and UI. We can't wait to show you what we are building!
Hiring: Community Intern 📝
As we continue forth our mission of building the next generation of retail investing, we’re looking to bring on a Community Intern to support us on the Community and Communications front. If you or someone you know is a finance/investing whizz with a passion for community-building, check out our job listing below:
Creator of the Week
In this week’s installation of our Creator of the Week spotlight series, where we highlight some of our most engaged Creators across the community, we have: Iris ten Teije Here’s a little bit from Iris:
What do you generally like to invest in? Stocks, particularly high-growth technology companies, such as Shopify, AirBnB and Amazon. I then have some money invested in alternative investments: collectibles and crypto. I plan to shift more of my portfolio to the collectibles category once we launch the alternative investment platform I'm working on.
How would you describe your investing style? Aggressive, but always deliberate and thoughtful and I don't do any day trading. I'm young and my investments are for the long term so I can take more risk.
What industry/company’s future you’re excited by and why? Companies where I can see huge untapped potential that will be unlocked once big developments take place: technological developments, demographic shifts etc. Think of Uber, for when have self-driving cars; Roblox, for when the metaverse will be part of or daily lives; or Shopee as the young middle class in Southeast Asia is still growing rapidly.
What do you love about the Zash Community? Interesting content that's being shared, as well as gathering new investment ideas.
How NFTs can shape the world of physical assets ⛓️🎨
This Creator guest post has been written by Iris from Koia - the startup on a mission to bring alternative investments to everyone. Koia is building a fractional ownership investment platform.
If you’ve been following the news, you’ve probably seen the recent flurry in activity around non-fungible tokens (NFTs). The US$69 million sale of a digital artwork sold by auction house Christie’s is what really brought this asset class into the public eye. While the sale has certainly created buzz and excitement, it has also left many wondering whether we’re in the middle of a bubble or whether there’s more to the NFT “craze”.
To recap, NFTs are unique digital tokens that typically represent ownership in a digital collectible good, such as a digital work of art. Most NFT content so far has been centred around digital art and digital collectibles. NFTs could, however, also serve a purpose in the realm of physical assets and collectibles. In this article we’ll explore several ways in which NFTs are entering the world of physical assets, and what real benefits they could bring beyond speculation.
What are the top use cases for NFTs today?
Digital Art
The most talked about use case for NFTs today is that of digital art. Platforms like OpenSea and Rarible allow artists to upload and sell their digital art to collectors and investors. Once a collector buys the NFT, they become the new owner of the digital artwork and can sell it to other users on the platform if they wish.
Digital Collectibles
Other digital collectibles are also gaining momentum, particularly those tied to well-known brands and franchises. Notable examples include digital football cards sold via Sorare, which is now officially partnered with most of Europe’s top football clubs, and NBA Top Shot, a platform which recently closed a US$305 million funding round and enables fans to buy digital moments in NBA history.
NFTs and physical assets
In addition to digital assets, there are various ways in which NFTs and blockchain technology more generally could play a role in the arena of physical assets.
1) Authentication
One of the key attributes of NFTs is that it can help with verification and authentication processes as each NFT is unique and can’t be reproduced. An interesting example includes Nike who has filed a patent for “CryptoKicks” which would allow it to tie a digital asset to each pair of shoes. When someone wants to resell their shoes, they could sell the shoe as well as transfer ownership in the digital asset paired with that shoe. Compare it to when you want to buy an expensive second-hand item and ask for a receipt or paperwork. The difference in the case of the Nike example is that since it’s recorded digitally and can’t be tempered with due to blockchain’s unique qualities, the “receipt” cannot be faked which adds an additional layer of security.
In the space of luxury goods, similar initiatives have come into the market in recent years. One of the most well-known examples is Everledger, a company that started by putting diamonds on the blockchain. This allows for their authenticity to be verified and also for the entire supply chain to be mapped out in a tamper proof way, as would be a risk with a regular paper trail. This process can help make sure diamonds aren’t coming from, for instance, conflict-ridden areas and marketed by intermediaries as coming from somewhere else. Comparable initiatives are popping up in other industries that have traditionally been intransparent, such as the wine industry. In this case the goal is again making sure that there is a clear record of where the wine came from and where it has been throughout its journey.
2) Price Transparency
If every sale of an item is recorded on the blockchain and the data is publicly accessible, it greatly increases price transparency. This could benefit investors and collectors in several ways. Firstly, having an accurate picture of price history can help determine whether you’re getting a fair price and whether what you’re buying has potential as an investment. Moreover, in a market with more price transparency, buyers typically benefit as there is less room for brokers to charge high commissions or unfair prices.
3) Royalty Payments
In the music industry it is common for an artist to benefit from their work as long as it remains popular via royalty payments. In the world of physical assets, however, royalty payments aren’t often talked about. Some platforms like Rarible now allow creators to earn commission on each future sale. A similar concept could be embedded in the sale of physical works of art or other collectibles if ownership rights are transferred via NFTs. The NFT, which is bound by a smart contract, could specify an auto-execute payment to the original creator whenever the NFT changes hands. Not all collectors support this concept, as some believe that once they have bought an item they are now the full owner, and it’d be unfair to have to pay a portion of future sales to the creator. On the other hand, some argue it is only fair for creators and their families to profit if works drastically go up in value at a much later point in the artist’s life or even after death.
Conclusion
NFTs have been around for a number of years, but have only recently started to become popular with a wider audience. As a result of its exploding popularity, the landscape is changing fast and new innovations and platforms are coming out every week.
At Koia, we want to be on the forefront of these developments and as a start, we plan to use blockchain technology to fractionalise the assets we list on our platform. Some of the advantages this brings are precisely the ones that listed above: an added layer of security and the ability to independently verify how many tokens are issued so we can never sell more than we claim to be selling, as well as full price transparency of past trades.
Given the benefits NFTs and blockchain could potentially bring to the realm of physical assets, we believe that over the next few years we’ll see a greater convergence between the space of digital and physical collectibles, with more players in the physical world adopting some of the technology that’s now almost exclusively reserved for digital assets.
Reading of the Week
Fintech and the Creator Economy continue to collide as evidenced by this latest venture with infamous YouTuber, Mr Beast
If you’re looking for an in-depth and fascinating run-down on DAO’s, here’s a brilliant piece from the folks over at Not Boring The Dao of DAOs
Sotheby’s to host an auction that seeks to capture new forms of presenting digital value and unlocking new avenues for creativity
A brilliant (and seemingly random, but beautifully orchestrated) amalgamation of articles ranging from the relationship of metaphysics and blockchain through to an explanation of why European neobanks have struggled with profitability from the Fintech Blueprint
That’s all for now and we’ll see you next week,
Team Zash
P.s. it seems that some of you have had our emails going to your Promotions tab. In order to train the algorithm, you can drag the email into your inbox - that should sort things out :)