NFTs (non-fungible tokens) are one of the blockchain use cases that have had significant adoption with mainstream brands and users over the past few years. They have captured the imagination of big businesses and users as a way to uniquely represent a transactional brand asset in an increasingly digital world.
While there was an initial fervor, the concept and unique value proposition of NFTs issued on a decentralized blockchain remains and continues to grow in awareness and develop as a sector within blockchain.
With more interest in blockchain and crypto, there is also naturally more interest in NFTs as well. Additionally, asset tokenization is an area of emerging discussion within business circles and a potential game-changing use case for NFTs and blockchain technology due to the versatility of NFTs to tokenize nearly any type of asset including tangible and digital assets.
As many people associate NFTs with art pieces and video content, here are some other NFT use cases to be aware of.
1. Real Estate
When it comes to the usage of NFTs for asset tokenization, real estate is a huge use case where NFTs provide many unique benefits over existing methods. Some blockchain-based projects are working on creating platforms that take the real estate and land registry deeds of property and tokenize these assets. These property rights are then able to be traded as digital tokens on other platforms and marketplaces that are under development. Especially in regions where property and land registration rights and processes are underdeveloped, NFTs present a compelling use case due to their transparency and accountability.
NFTs can record the property’s information instantly along with other important details in the metadata. Anyone can access this data at any time since it is issued on a decentralized blockchain.
Related reading: EMURGO Africa and Adaverse invest in HouseAfrica to create a digital property registry
Landano is a project on Cardano that aims to integrate blockchain technology into land registration and property rights. They recently held a panel where the project’s team discussed the topic. They already have implemented the solution in Africa and showed great promise.
NFTs also allow for the fractionalization of the token which increases its accessibility and liquidity. Potential investors can buy portions of properties and this opens up investment opportunities to a much wider range of investors.
2. Finance
When we think of financial services using decentralized blockchains or decentralized finance (DeFi), people usually think of fungible assets. While DeFi applications tend to use fungible tokens in most cases, NFTs are also making inroads into the DeFi space.
Increasingly, assets that have some unique characteristics are being represented as NFTs. Some of the prominent potential use cases are government bonds and treasuries. This type of debt is issued by countries to raise funds as each bond has unique features that need to be captured by a blockchain asset such as the coupon payment, the date of the payments, the duration, etc.
Related reading: 5 promising real use cases for DeFi
Tokenizing these bonds usually involves the usage of NFTs. These NFTs can then be simply traded on top of the decentralized blockchain ledger directly through the involved parties or on marketplaces. They are very much a big potential part of the DeFi ecosystem even though they are not the traditional token standard for that ecosystem.
3. Event tickets
Tickets for sports matches, concerts, conventions, and other events have long been an ideal use case for NFTs. Indeed, many major blockchain events like Devcon, Consensys, and similar gatherings have incorporated an NFT component to attendance, either as the way to enter the venue or as mementos of the event itself.
Yet, this practice has mostly been limited to crypto-related events. The industry at large has seen increasing interest in the use of NFTs, but the complexity of the technology has prevented mass adoption in more mainstream gatherings.
However, this is slowly changing. Many NFT projects are also focusing on creating low-code or no-code solutions for NFT tickets. This would allow event planners the ability to generate the tickets without having to hire a dedicated team of blockchain developers. These new platforms can foster the mass adoption of NFTs from another industry and bring more users into the blockchain.
One such platform is NMKR which is simplifying the entire process of minting NFTs for a variety of tokenization use cases including ticketing on top of Cardano. It has created a set of tools that allow web developers to integrate blockchain technology into services without having to know how to code smart contracts or any of the associated technologies.
The advantages of using NFTs for event ticketing include simplicity (only have to carry a smartphone and wallet with the NFT), prevention of ticket scalping (NFT metadata contains relevant purchasing information that blocks scalpers and allows fairer access for anyone to purchase tickets), proof-of-attendance, and more.
Related reading: NMKR’s tokenization platform helps businesses to maximize brand impact
4. Subscriptions
Decentralized subscriptions have often been a technology that blockchain projects have aimed to deliver. The benefits of creating subscription services that do not track or record the users’ information are numerous. Yet, this has proven to be very difficult.
NFTs offer a solution. An NFT can record the terms of a subscription such as the price, the duration, the level of access, and the rewards of the subscription. The site would need to check a wallet for an NFT before allowing access to the services.
Dolce and Gabbana, the popular fashion brand, is experimenting with this concept. They have released nine exclusive NFTs that give the owners exclusive access to the brand’s VIP services. This means access to events, clothing collections, and special deals.
5. Resale of certain digital items
This seems straightforward as NFTs have always been about ownership of media. The images attached to the metadata of the NFT are the pieces of art that make the token valuable, not the numbers recorded on a blockchain. But there are many other digital items this model can expand to.
Video games have increasingly been distributed fully digitally, with some titles abandoning physical media altogether. There are many advantages to this model, but one major drawback is that there is no way to resell the game once the return window is over. If a buyer doesn’t like the game, they are stuck with the digital copy forever.
NFTs can change this modality by allowing the resale of a digital item or goods. This is already happening with digital books. Book.io releases full digital books as NFTs. Any person can buy these and later resell them, sometimes for a profit, either peer-to-peer or on marketplaces.
NFTs have the potential to allow ownership of digital goods that also have a secondary market. People can take their digital copies and pass them to another person when they no longer have a use for them.
This would also increase the need for secondary marketplaces to facilitate safe and secure NFT transactions.
Are you looking for more information on tokenization using blockchain technology?
EMURGO is partnered with NFT and Tokenization platform NMKR to drive adoption and awareness of the ease and valuable utility of asset tokenization, especially for businesses and creators.
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