Singapore Perspective: Embrace the Future with Non-Fungible Tokens (NFTs)

Written by Wayne Yia and Dreamer

Vogue Singapore NFT Collection: Peacock and Sunrise [OpenSea]

In the fast-changing world of technology, a new kind of digital item called Non-Fungible Tokens (NFTs) has popped up. These are special digital codes that are changing how we think about worth and ownership online, and this is happening everywhere, including in Singapore.

chefpierre NFT Collection: Bored Ape Yacht Club [OpenSea]

Uniqueness and Scarcity: The Core of NFTs

NFTs are different from regular digital money like Bitcoin. Each NFT is unique and can’t be replaced with another. Because there aren’t many of them, they can be quite valuable. The Singapore High Court has said that NFTs can be treated like property. This is because each NFT is different from the others and they have owners who can be identified. This decision is a big deal because it helps to establish NFTs as a serious type of asset. NFTs can represent all sorts of things, from digital stuff like art, videos, and music to actual physical things.

Shubham Dhage: blockchain concept illustration in 3d, connected blocks in blockchain. [unsplash]

Verification Process

Just as each NFT is unique, so too is the process of verifying their authenticity. Think of the verification process like a librarian checking out books at a library. The librarian uses a secure, public digital list called a blockchain to keep track of who has which book. This system is so secure that it can’t be tampered with or duplicated.

NFTs vs Cryptocurrencies

Properties	NFTs	Cryptocurrencies
Both are digital assets	Yes	Yes
Both exist on the blockchain for access	Yes	Yes
Non-replaceability	Yes	No
Interchangeability	No	Yes
Unique features and attributes	Yes	No
Used to purchase goods and as investment tools	Yes	Yes
Proof of ownership of anything	Yes	No
Medium of exchange	Yes	Yes
Utility and scarcity determine value	Yes	Yes
Inherent value of the currency	No	Yes

This table compares the properties of NFTs (Non-Fungible Tokens) and cryptocurrencies.

New Avenue for Artists and Brands

Singapore’s own fashion label, Love, Bonito, collaborated with local artist Kristal Melson to launch their first-ever NFT, “Tiger Bloom”. This digital artwork, embodying both femininity and fierceness, sold out in just over four hours on the NFT marketplace OpenSea, demonstrating the growing interest in NFTs in Singapore.

The artwork was part of a project for Singapore Art Week, with a portion of the sales being donated to charity. This successful launch not only showcases the potential of NFTs as a new avenue for artists and brands, but also signifies the increasing integration of NFTs into Singapore’s digital economy.

Other Application Areas of NFTs

Gaming Assets

With a decentralized infrastructure, NFTs have found a place in the gaming industry. For instance, CryptoKitties, encrypted cats launched in 2017, each have a unique identifier. These crypto cats can be bred to create new ones, leading to various gameplay scenarios. They once caused congestion in the Ethereum network. Another example is Axie Infinity, which gained popularity during the COVID-19 pandemic. Equipment, tools, and pets in the game are all NFTs.

The Sandbox’s Map and Samsung Virtual Store in Decentraland

Virtual Real Estate

NFTs enable communication with avatars and other users, exploration of new spaces, and ownership and creation of new content. Real estate NFTs can be purchased, and virtual real estate evolves into galleries, bars, concerts, fashion shows, music, promotional stages for projects, and even on-chain casinos. Examples include Decentraland and The Sandbox, and many multinational companies have purchased real estate NFTs.

Concert Tickets

Renowned artists are not just selling NFTs, but also gifting unique NFTs to dedicated fans attending concerts. A-mei, a well-known Taiwanese singer, gave 130,000 unique NFTs to the hardcore fans who came to watch her concert. It is apparent that there is a lot of room for imagination in the use of NFTs. It allows NFT holders to:

participate in activities for free;
buy tickets in advance;
interact with the singer in virtual space;
link the real world and the metaverse;
obtain more accurate data analysis from the blockchain; and
solve problems such as ‘scalper tickets’ and fraud

Luxury Limited Edition Items

“Phygital” is a blend of the words “physical” and “digital”, and it refers to experiences or products that combine elements from both the physical and digital worlds. This concept has been increasingly applied in the world of NFTs. A “Phygital NFT” is a specific type of NFT that has both physical and digital components. This means that when you purchase a Phygital NFT, you’re not just buying a digital asset, but also a physical item or experience that’s tied to that digital asset.

In the context of Luxury Limited Edition items, brands are experimenting with Phygital NFTs to better link the physical and digital worlds. For example, Gucci have a project called Gucci Vault where they showcase their rarest vintage apparel as NFTs. So, when you buy an NFT from Gucci Vault, you’re also getting a piece of Gucci’s history.

Summary

NFTs, or Non-Fungible Tokens, are like unique digital collectibles. They’re used in many areas, from protecting creative works like music and art, to representing virtual identities and even domain names. As technology grows, NFTs are set to unlock even more exciting possibilities. Imagine owning a one-of-a-kind digital token that’s tied to a real-world item or experience. That’s the magic of NFTs!

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