Our growing dependence on social media and its relationship with NFTs.
Source: Epic Games
Author’s Note: This is Part 3 of my NFT series. Click here to read Part 1, where I document the rise of NFTs. And here for Part 2, where I talk about it as a foundation of the new world.
Let’s recap the first two parts of this series.
NFTs are a cryptographic standard that allows for authentication and verification of ownership of assets — most easily done with digital goods.
NFTs have exploded in popularity, and while currently a bubble, the underlying tech is here to stay.
NFTs are here to stay because they are the intersection of the two world-shaking paradigms shifts: the Metaverse and Web3.
Metaverse is a virtual world that every human will have access to and will spend a sizable chunk of their lives in.
We’re rapidly moving toward the Metaverse as technology like 5G, VR/AR, and cloud gaming improve — accelerated by the Covid pandemic, forcing the world to adopt a more digital-first approach to work and social life.
Web3 is the next era of the internet founded on the values of being open, permissionless, and trustless; blockchains are one of the driving technological forces in the Web3 movement.
TLDR; as the world becomes more digital, the need for trustless digital ownership will arise, and NFTs will solve that need.
Phew — now that that’s out of the way, and we understand the thesis for the importance of NFTs — let’s double click into the tactical implications of NFTs in today’s world.
Digital Identity in a COVID World
Social media has always been a big part of our lives.
I can’t even imagine the number of collective hours my generation (and Zoomers) has spent deliberating on which pictures to put on our Instagrams, or what words to put on our Twitter bios, or what questions to answer on our Hinge profiles.
My Instagram looks very different than my LinkedIn
And each platform has a slightly altered version of ourselves.
Beach pics are a no go on LinkedIn, but welcomed on Insta. You can’t post a story of you drinking on Insta, but it’s okay on Snapchat. Suit and tie is okay on Linkedin, but a faux pas on Hinge.
Each platform shows a persona of us.
Different parts of our whole personality that we package into context-relevant interactions — whether it be dating, networking, showing off, etc.
And COVID has only exacerbated our reliance on digital platforms — from an augmentation of our IRL identities to being a full substitute for our social lives and even work lives.
We care about how we look online because, during COVID, that has become our only way to interacting with the world outside of our homes.
In other words, our digital identity is our identity — externally at least.
That’s why we have filters for Zoom.
That’s why there are dozens of apps that preview your Instagram profile before you post a new photo. Influencers to make sure their feeds look absolutely perfect before sharing it with the world.
That’s why people are spending billions of dollars on character skins on Fortnite.
That’s why people spending hundreds of hours creating content for Clubhouse, Twitter, and Substack (guilty) — hoping to build a brand for themselves, and hoping to project a certain image of who they are to the rest of the world.
NFTs are the next evolution of digital identity
What if I told you that all hours that you spend carefully building your digital image can disappear in a blink of an eye — purely on the whim of a few individuals?
You’d probably think twice about investing your time on that platform.
But what are the chances of that happening, right?
It happens every day — to the thousands of accounts that break the community guidelines established by platforms like TikTok and Twitter.
And that’s not to say that companies aren’t in the right — they ultimately have final say on what can and can’t be posted on their platforms. And we agree to those conditions in the T&C when we join the platform.
But it sure is a damn shame that all the photos, videos, articles, and followers are gone with it — all the hours that you invested gone with them too.
It’s like creators generate all this value for these companies (both from a user adoption and advertising revenue perspective), and they receive — at best — a pittance for their blood, sweat, and tears.
OK — but what if we could exactly keep all the content that made for each platform?
What if we could move our content from platform to platform, curating each feed based on the context of the platform?
These platforms would look a lot less like walled gardens, and more like open platforms that wrap content in a delightful user experience — potentially providing services on top of the core experience as a way to monetize.
Then these platforms would have to compete for the best experience and the best services — a lot like how banks have to differentiate their services, products, and customer experience to compete for our money.
In order for that to happen, we need to have true ownership of our digital content — and thus our digital identity.
We need to have NFTs.
NFTs for our instas, NFTs for our tweets, NFTs for our skins on Fortnite.
And eventually, as our world becomes more digital-first in terms of person-to-person interactions, we’ll need to have ownership of our digital spaces as well.
NFTs for our digital land, our digital homes, our digital furniture.
Because like my IRL identity, I want to actually own my digital identity, not rent it out to a landlord like Facebook.
Our avatars are literally our faces in the digital world.
MetaKovan, the founder of NFT fund Metapurse and buyer of the $69M Beeple piece, likened avatars as our “exosuits.”
They’re who we want to be, and who we want to be seen as.
So wouldn’t it make sense in investing in an avatar, and actually owning it?
Moreover, just like owning physical things, I want to be able to sell or monetize my digital possessions.
I want to be able to resell the items that I buy from Fortnite or from Call of Duty. In doing that, I’m able to generate asset value from my purchases — and not just rewriting off as a purchase with no intrinsic monetary value.
And what enfolds is a user-generated, two-side economy of digital goods. Swords for skins. Furniture for cars. Or just selling things for good ole money.
A democratization of digital ownership — in what used to be a one-sided market where the game creator made off with its riches.
What’s next for NFTs as identity
Avatars
Crypto-centric communities like Twitter and Discord are already adopting the social norm of having NFTs as their avatars — their exosuits that embody who they want to appear as in the current day almost-Metaverse.
OG crypto heads and NFT connoisseurs will don CryptoPunks as their avatars, the original NFTs that range from $40K to upwards of several million dollars.
Less funded folks like myself will don an “unofficial punk” — follow-up renditions of the original punks — or another NFT that accurately depicts who they are.
Game Items
Skins are the largest form of expression in a video game, but other items like weapons, armor, and vehicles can still be valuable in forming a digital identity.
After all — doesn’t it feel good to roam around in your fully modded up character and flex on others?
Gain some clout with your maxed out World of Warcraft character
Immutable X is another NFT game developer platform that has a native marketplace for players to trade their goods across popular NFT games like Gods Unchained.
Forte is building a platform for game developers to easily include blockchain into their games — allowing for players to tokenize their assets and participate in a two-side marketplace and true ownership that can be moved cross-platforms and cross-games.
Clothing
I have an Instagram account that posts my daily outfits (it’s currently on hiatus because I ran out of outfit combos).
It was a nice forcing function to wear clothes that I haven’t worn in a long time due to the pandemic, as well as make me be more creative and attention toward layering pieces together.
The funny thing is that 90% of my followers will realistically never see those outfits — because they will never see me IRL.
And I know that and I think they know that, but it’s still fun to look at clothing online. We can take that ethos a little bit further with digital clothing as NFTs.
The Dematerialised is a company that’s pushing the boundaries for digital clothing, NFTs, and cryptocurrencies.
They sell NFT clothing that can be uploaded to existing photos or even projected into the ‘real’ world using AR.
Source: https://thedematerialised.com/
In addition, executives at fashion powerhouses like Gucci and LVMH have publicly expressed interest in NFTs — especially given the ability to manufacture scarcity and have trustless verification of authenticity, which are two qualities that luxuries brand value.
“NFTs introduce the magic ingredient which compels consumers in the real world to splash out on designer goods like clothes, watches, shoes, or bags — scarcity,” said Emma-Jane MacKinnon-Lee, the Founder and CEO of DIGITALAX.