It’s no surprise that nonfungible tokens (NFT) have been dominating the crypto market this year. The booming digital asset class generated over $2.5 billion in sales within the first six months of 2021, demonstrating unheard-of financial gains for artists, brands and content creators across the globe.
The rise of metaverses has also impacted the adoption of NFTs, as the world is moving closer toward visions of a future defined by augmented reality. As such, NFTs are further demonstrating the convergence of culture with technology, which in turn is having an impact on a number of mainstream industries.
Showcasing culture and community
Specifically speaking, the million-dollar luxury fashion sector has started taking note of NFTs. High-end fashion brands, such as Dolce & Gabbana and Jimmy Choo, have recently launched their own NFT collections, while designer Rebecca Minkoff became the first American female designer to create and showcase an NFT collection during New York Fashion Week 2021.
Megan Kaspar, managing director at Magnetic Capital and member of Red DAO — a fashion-focused decentralized autonomous organization — told Cointelegraph that she believes fashion is one of the most interesting NFT categories:
“The fashion industry, one of the largest industries in the world, generated $2.5 trillion in global annual revenues prior to the pandemic. Red DAO’s thesis around digital NFT fashion includes the potential of global revenues at least doubling over the next two decades due to the digitization of fashion and new capabilities offered.”
While NFTs for the fashion industry is still a very early concept, Kaspar explained that physical fashion today has limitations. For instance, she pointed out that luxury fashion items will always have a secondary retail market value, but as a product is diminished over time, the items lose their worth.
Yet digital fashion pieces will always remain intact, with the added potential to increase in value if they are highly sought after. Kaspar commented that digital NFT fashion pieces can also be worn virtually, as she recently demonstrated during a video interview where she sported virtual NFT earnings and other accessories.
Kaspar further noted that unlike tangible fashion pieces, digital items can be used as collateral for client retention and community engagement. Kaspar mentioned that high-end designers currently have limited engagement with consumers: “NFTs can be used to redeem physical items or to unlock upcoming fashion drops. They can also provide access to private events.” She added, “Designers will also be able to communicate with customers through digital wallets, almost like email.”
While Kaspar realizes that these use cases are still very early, she believes that more brands will eventually start to create NFTs to achieve such benefits. For now, however, it’s notable that a few innovative luxury and haute couture fashion brands have already started to demonstrate the potential of NFTs.
Shashi Menon, the Dubai-based publisher of Vogue Arabia and founder and CEO of UNXD — a creator and curator platform that designed all of the digital assets for Dolce & Gabbana’s nine-piece NFT collection — told Cointelegraph that his team directly approached Dolce & Gabbana in April this year with the idea of launching an NFT collection.
Menon shared that the opportunity was contextualized from a place of understanding both the luxury fashion sector and the crypto world. “We’ve been involved in both for years and think we have a unique perspective to offer,” he said. Menon believes that the story around NFTs and fashion is not one of technology but rather about culture, remarking that both fashion and NFTs are “ultimately forms of cultural expression.”
While culture may be the most important element from a brand’s perspective, blockchain technology plays a critical role in ensuring the unique benefits achieved by NFTs,…
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