In May 2021, Gucci sold a virtual handbag as part of an exclusive Roblox event for 350,000 Robux – which is around $4,115. The bag – which features the brand’s signature monogram, and is ‘embroidered’ with an orange bee – is not an NFT, and can not be used outside of the game. It is simply a digital iteration of an offline product that was only available to buy once. The fact that it sold for more than the offline version – which retails at around $3,400 – is testament to the fact that digital items have taken on new value.
People have started to understand and appreciate the monetary value of digital content.
This shift has been building for some time. It’s now normal for digital creators to be remunerated for their creativity – from the uptake of paid-for newsletters to the mainstreaming of OnlyFans. And the growing amount of time spent in game worlds is translating to a desire to invest in our avatars.
But this year, digital goods have been given new value by the sudden spike in interest for NFTs: 8% of social media users globally have already invested in them. Why? Because NFTs have introduced the notion of scarcity to a digital landscape overloaded with stuff.
By ‘tokenising’ a piece of content on the blockchain, a creator is essentially saying that they have only approved one of that piece of content. When Jack Dorsey tokenised the first ever Tweet (which later sold for $2.9 million), the person who bought that NFT knew they were buying The Tweet – a moment in history – not just a screenshot of the tweet that came after.
Content has become an asset – and as a result, digital ownership has evolved from fringe fascination to legitimate investment.
Just like the status symbols of yore – buying a Rolex, buying a Porsche – buying an NFT is an act of conspicuous consumption. But this is the NEW new money. In digital economies, who gets rich isn't defined by who you know, but who you follow; in this world, investments aren’t just in digital assets, but in the communities around them.
Investing in online goods has become the hottest way to earn clout, both online and off.
It’s why digital clothing has become such a success story: 33% of Gen Zers globally have purchased digital clothing or skins for their avatars. Industries that already trade in status are the natural early adopters in this shift. Not to mention the fact that virtual goods hint at the promise of a more sustainable future for an industry steeped in eco-nightmares: Farfetch, for instance, has been sending influencers ‘virtual samples’ to minimise its carbon footprint.
But for brands across industries, the economy that’s building off of digital stuff presents exciting opportunities. Investing in virtual goods can indicate so much more than great taste or financial independence.
Digital ownership is increasingly being used as a way to signal what you believe in, show people what you love, and give a shout out to the communities you’re a part of.
On the cutting edge of digital ownership, in early 2021, artist Krista Kim sold a virtual house that can be visited via VR platform Spartial for over $500,000 (all the better to hang your NFTs in!). What this looks like for the more pedestrian early adopter? Buying a Balenciaga hoodie for your Fortnite avatar.
If you own one of my NFTs today,— ▽ (@3LAU) August 11, 2021
You’ll get to own rights in my music,
Which also means you’re entitled to cashflows from that music…
Fucking 🔥— Zoe Scaman (@zoescaman) April 17, 2021
Nike's 'Cryptokicks' patent allows for the 'breeding' of 2 NFTs to create a shoe 'offspring' that can then be made into custom sneakers
THIS is the type of crazy cool shit that NFTs unlock that no one's thinking about yet
Pay attentionhttps://t.co/tMTW9gSDdn pic.twitter.com/WKSKY521zO