The NFT universe is interested in fashion and luxury. A shared interest. Speculative bubble or justified craze?
2021 is the year of NFTs, the famous non-fungible tokens that are scaring young and geeky investors by combining cryptocurrencies and blockchain. Sales have exploded in August; speculators are rushing in with glee. A craze favoured by confinements (physical art was no longer accessible) and justified by the growing interest of the art world, sports and media. Marvel put several anthology comics up for sale, a collector spent $600,000 to buy the jpeg of old rock, unpublished photos of the young Kobe Bryant were auctioned using this process, and even the American Visa acquired the image of a virtual punk (one of the 3,840 female punks listed on the platform created by Larva Labs) for $150,000. A work by the artist Beeple was sold as an NFT for $69.3 million at Christie’s last March. The most unexpected examples abound.
Perhaps it’s worth pointing out that an NFT is a digital item that, thanks to blockchain technology, is made non-fungible, i.e. unique and non-exchangeable. The virtual object, whatever it is (an image, a video, a gif, and even a computer code), then takes on an original and authentic character since its ownership is verifiable and attested. A unique image, recognized as the original model, then takes on the character of a work of art. The interest for the owner of an NFT is thus to display a social status (in the same way that one displays an original painting at home or in a foundation in his name: the fact of displaying an original cryptopunk in the cover photo of his Twitter feed thus becomes a sign of wealth) and/or to value a speculative asset.
Bubble that is about to burst?
For some sceptics, this fashion is purely and simply a lottery and a bubble that will soon burst. Other collectors, on the other hand, are betting on the simplification of this practice that will make it accessible to the general public very soon. “Within 5-10 years, platforms like Instagram will allow NFTs to be posted. These works will become means of communication: if Gucci offers NFTs to an influencer, those who follow him will want to buy Gucci,” predicts collector Nikola Niksic quoted by France Info. Small difficulty: you have to be familiar with the technology, have an online wallet, inject cryptocurrencies and connect to a dedicated sales website. We are more in a world of geeks than traditional collectors for the moment.
Fashion and more particularly luxury goods, where exclusivity is highly sought after, have understood the interest of NFTs. Both as a vector of communication but also as a new way to the customer experience offering new services. Gucci, a pioneer in the field (the brand had already launched the marketing of digital products) presented its first NFT in the form of a digital art piece representing a metaphorical universe of a galloping horse. This NFT had a starting bid of $20,000 payable in Ethereum. Rimowa, on the other hand, inaugurated its first NFT collection by teaming up with design studio Nuova to imagine four pieces inspired by airline furniture. The series, entitled “Blueprints for the Metaverse”, consists of physical goods transformed into digital artworks.
In June, Valentino inaugurated a digital art exhibition in NFT based on the work of British artist Matthew Stone. Finally, to close this series of examples too numerous to list, let’s mention the giant Louis Vuitton. On the occasion of the 200th anniversary of the birth of its founder, the trunk-maker launched “Louis: The Game”, a video game in which 30 NFT are integrated. The game features Vivienne, the company’s mascot, on a quest to find the 200 birthday candles along a path designed around six worlds. The trunk-maker’s well-understood idea is to establish a link with the ultra-connected generation of consumers to come. A breakthrough in line with the philosophy of Michael Burke, Louis Vuitton’s CEO, who claims: “The best way to engage people is through the medium they love. A bet on the future.
Ethics and transparency vs. high carbon footprint?
Another potential use of NFTs: sustainable development. This technology would allow luxury and fashion to enter a new decade of transparency and authentication in an ethical way. The customer would be able to follow the history of all transactions from conception to repair of the product. The NFT would also allow to ensure the product or to extend the warranty, and more globally to tighten the links between a luxury house and its customer thanks to secure technology. The company DressX, founded in July 2020 by Daria Shapovalova and Natalia Modenova offer virtual clothes that can be worn digitally by its users for their photos and videos: the company has partnered with Crypto.com NFT to stimulate the purchase of digital assets. One of the main arguments of the two companies is to reduce pollution by consuming virtually. Laudable and innovative wishes. The only catch is that this technology consumes a lot of electricity. The carbon footprint of NFTs is therefore considerable. In short: a technology full of promises but also of paradoxes.