One of the ways non-crypto native consumers have heard of crypto is through NFTs, or non-fungible tokens. Although NFTs typically started out as .jpeg art, they continue to be a topic of discussion throughout the crypto ecosystem for their innovative ways to prove ownership and act as digital collectibles for consumers who want to support certain communities and artists. NFT use cases, and the utility of NFTs, continue to expand over time and are expected to play an increasingly important role in the crypto ecosystem as both cultural artifacts and technological innovation.
At Converge22, we gathered the following panelists for a discussion on The Next Wave of Mainstream NFT Use Cases: Whitney Steele from OpenSea, Michael Bouhanna from Sotheby’s, Ridhima Kahn from Dapper Labs, and @punk6529, with Robert Hackett from a16z crypto as the moderator.
Building In A Gloomy Macroeconomic Environment
Hackett began the discussion by asking the panelists about how they are navigating the recent downturn and building for the future. Steele explained that despite the negative headlines and bearish sentiment throughout the past few months in crypto, “In bear markets we get to invest in the fundamentals… and invite more creators and make it easier for them to build, because we know that the next wave is coming.”
Weighing in on core principles that will guide the expanding use cases of NFTs, @punk6529 said, “Over the next decade we will progressively digitize. In that world, people will want to own digital objects. These could be collectibles, metaverse land, buildings, any digital intangible.” And that even though crypto is operating in a bear market, “Market cycles are normal and don’t mean anything, we’ve gone through this before…We’re at the beginning of the beginning.”
Bouhanna weighed in next to find silver linings amidst a stressful macroeconomic environment, and how Sotheby’s is prepared to exit the downturn stronger than before. During times of lower volume, “It’s a time to bring up quality artists and defend the fact that this is a new medium, new tech, and will create a new movement with a new group of artists.”
Building on the theme of improving underlying architecture to welcome the next wave of new users, Kahn said Dapper Labs is, “focused on making blockchain accessible and comprehensible to a mainstream audience.” As their NBA Top Shot product continues to gain popularity among sports fans, Dapper Labs remains excited to, “help to engage players and their fans in more direct relationships.”
NFT Innovations In The Crypto Ecosystem
As the conversation shifted to some of the most innovative NFT projects underway today, Steele expressed interest in a paradigm shift in how people participate in communities – in turn enhancing the utility of NFTs. She explained that traditionally, people have led with their identities and followed their interests. But what she is most excited for in the future of NFT projects is seeing people who lead with their interests to participate in online communities, and may keep their identities anonymous, a common characteristic amongst web3 users. In her view, “There’s a world where we can control our data, surface what’s important to us, without having to share the vulnerable or private parts of our identity.”
@punk6529 also weighed in on important NFT use cases and innovations that need to come to market. In his view, “the biggest issue is the front end, not the tech. The front end is actively terrible. For a normal person, it is borderline un-usable.” He believes that even for highly sophisticated users, the process to transfer funds or NFTs is still difficult and not apparent to new users. Further, “We need to make the front end usable, make it easier, and keep the back end permissionless” in order to balance ease-of-use with the privacy and security of decentralized technology.
Steele and Kahn agreed, stating that creating an easy-to-use wallet where users can seamlessly transfer funds and make their first purchase is an important next step for the industry as a whole.
Applying the utility of NFTs to the fine art world, Bouhanna explained that one of the most promising use cases for NFTs is to assist with art authentication. Currently, physical art has to undergo lengthy inspections, secured transport with armed guards to and from estates and museums, and may be subject to re-authentication if the process takes too long. However, he explained, “We feel that NFTs can be a much more efficient way to authenticate art” with on-chain signatures and transparent transactions.
Excitement For The Utility of NFTs
The panel concluded with a discussion of the NFT use case each panelist is most excited for. According to Bouhanna, he eagerly anticipates the, “evolution of how we can enjoy the NFT once we have bought it”, whether that’s displaying the NFT in your home or online.
Kahn shared her hope that NFTs, “Will be a more engaging way for creators to do what they love, have transparency into their audience, and to blend physical and digital worlds.” Ultimately, she expects to see “improvements to fandom and the creator economy."
As it relates to web3 video games, Steele is excited to see “Better economies for in-game items. Creating much more liquid internal economies in games will make it real.”
And finally, @punk6529 reaffirmed his commitment to “helping people make their own digital spaces…and doing so in a self-sovereign manner.”
Stay tuned for future recap blogs as we discuss some of the most innovative and insightful conversations from our inaugural crypto ecosystem conference, Converge22. We invite you to learn more about How Circle Powers NFT Payments with USDC.