Utility NFTs: Beyond the Art

NFTs began to be used to give artists the possibility to exhibit their physical works in a digital way. As the industry has grown, more and more possibilities for their use are presenting themselves every day.

With the expansion of the non fungible token market, every day we see different uses, collections, companies, brands or organizations looking to ride the NFT boom. In NFTexpress we bring you every day the latest industry news and collaborate with the adoption of this new technology that undoubtedly comes to change the paradigm of digital property, profit and exclusivity.

They are no longer just digital pieces created by an artist or collections without any purpose. There are more and more possibilities to use them in the virtual world as well as in the real world.

At a glance we can notice that utility NFTs look the same as other NFTs, since, they are unique assets, cryptographically represented, built and stored on the blockchain. The transparency, security and immutability of blockchain technology makes it easy for users to store NFTs in their wallet. The real difference is the use and benefit that the project or company launching these non-fungible tokens can provide to the owner.

We will see some examples of projects that launched their NFTs and in turn generate environments, whether virtual or physical, where the owner of the NFT can use and enjoy the exclusivity to enter different sites where those who do not have that NFT will not be able to do so.

These utility NFTs can be found in different fields. The industries where this technology is most used are gaming, virtual terrains, social spaces for the generation of communities around some NFT collection and surely with the passage of time we can find the non-fungible tokens in many more, because this technology exists, but the way to use it is only limited by our imagination.

It must be understood that when NFTs are used for a company’s digital infrastructure, the company must find a way to integrate them into its structure.

Currently we see that the collections that organizations launch are isolated. The case of “Bored Ape Yacht Club” is unique in that, very few will manage to start as an NFT project and become an enterprise. It will be more viable to integrate such a strategy of non-fungible tokens into an existing organization that is already strong in the market.

Brands that succeed in integrating an NFT strategy into their existing services will surely endure over time.

On the other hand, we see that the first idea of strategy is to create a collection and launch it to the market to be purchased, but also a good strategy could be to give them away to the most loyal and recurrent customers of your organization. The clear example is Lemon, which created one million of its own NFTs and distributed them free of charge to all its users to give people who are customers of its services the possibility to interact for the first time with these non-fungible tokens and indirectly introduce them to the web industry3.

In the future, companies will have the need to formalize their communities, especially with blockchain technology, which by interacting in a decentralized and totally anonymous way, digital advertising and web page entry metrics such as cookies will become obsolete (Google in chrome, for example, is already eliminating them). Consequently, companies will have to customize in the best way the possibility of segmenting their community or recurring audience.

For example, Shopify, the Canadian e-commerce company, launched its “gm store” (gated merch, and a play on the Twitter cryptocurrency acronym for “good morning”). This feature is currently in beta, and only those with existing NFT collections can apply for early access.

However, Shopify partner stores that have not yet been approved can add a NFT token management application such as Shopthru or Single to their Shopify stores to unlock this functionality.

The ecommerce organization has partnered with NFT collections such as Adam Bomb Squad, Doodles, World of Women, Invisible Friends, Superplastic, Stapleverse and Cool Cats to create tokenized stores.

Undoubtedly, this will be a before and after in the way of incursion strategy and adoption in the future of shopping on the web3. The ecommerce that includes this function will give the user the possibility of logging in with his wallet, the store will verify that the person has a specific NFT and will unlock different benefits that can range from lifetime discounts on certain items to exclusive clothing that can only be obtained by people who have the non-fungible token.

On the other hand, with the integration of NFTs to a social network as powerful as Instagram, we will see the utility that companies can provide to their users. People share what interests us most on our networks and users who share their NFTs of preferred brands will give Meta and Instagram the possibility to hyper-segment advertising and interest, since, as I mentioned, there are several metrics functions that are being eliminated, such as cookies.

Finally and as future utilities of NFTs on Instagram, I imagine that companies could segment their audience by simply owning one of their NFTs, what we all know as “Best Friends”, could be useful for NFTs and only show content and advertising to the owners of the NFTs of the brands that join this boom of blockchain technology that every day society and companies are adopting by leaps and bounds.

This technology already exists; how we use it is limited only by our imagination.

Written by Rodrigo Catalan (TW: @RodrigoCatalanB) for NFT Express.