What is Physical Non Fungible Token (NFT)
Non Fungible Tokens (NFTs) have grown in popularity in recent times; be it the brazen cyber-attack or multi-million dollar sales, it is hard to escape the phenomenon of NFTs these days. As NFTs make their way to the mainstream, their main applications are not only inclusion of digital art, fashion, music, and the metaverse. In crypto space, physical NFTs are also carving out space. But what is it actually and how can you sell an item as NFT? Let’s find out.
Physical NFTs are cryptographic tokens linked to physical assets that provide ownership of artwork, merchandise, property deeds, and other assets.
Physical NFTs have two parts where the digital one is stored on a blockchain, and the physical one is the one that you own in real life.
Physical NFTs are the strongest use cases for enhancing in-person experiences through blockchain technology.
Physical NFT: What is it exactly?
While NFTs are mostly associated with the art world, they are also issued and sold as a virtual representation of off-chain assets, including antiques, consumer goods, and collectibles. In physical NFTs, they act as a cryptographic token of ownership over a physical and real-life item for the buyer if they want to have a physical version of the NFT. To put it simply, a physical NFT is nothing but a non-fungible token that is connected to a physical asset.
Also Read: Most Expensive NFTs Ever Sold: Here’s The Top 10 List
Due to the fact that physical NFTs are linked to real-world assets, they are also known as “phygital NFTs.” Similar to any other non-fungible token, physical NFTs can also be sold or redeemed for the physical asset that they are connected to.
How do they work?
A physical NFT typically consists of two parts, where one refers to the physical asset and the other one implies the digital asset that has been issued on a blockchain. The physical assets, on the other hand, are generally connected to a corresponding unique identifier, including a QR code or an NFC tag (near-field communication).
Also Read: NFT To Be Lifted From Income Tax Act In India?
Physical NFTs not only contribute to the authentication of the non-fungible tokens but are also useful when it comes to supply chain management. With blockchain technology traceability and certificate, allowance becomes easier for physical NFTs.
Some examples of Physical NFTs
While in the NFT space, the focus is yet to be reflected on physical NFTs, there are some big names that have introduced themselves in the domain.
In 2021, Adidas, the German sportswear company, made its way into the world of the metaverse by putting out an NFT collaboration with the famous Bored Apes Yacht Club. Buyers could get a hold of exclusive physical merchandise that includes beanies, hoodies, and tracksuits.
Co-founded by Beeple, WENEW is a platform selling “iconic” moments in history as well as cultural milestones as NFTs.
The popular fashion retailer GAP has also joined the NFT space by launching its first NFT collection that offers physical hoodies. The project was in partnership with Brandon Sines, the artist of Frank Ape.
Advantages of physical NFTs
There are a number of benefits that come with physical NFTs – from proving authenticity to assigning transparency.
Improving in-person experience
While NFT memberships are already in demand for being the gateways to online communities full of virtual experiences, physical NFTs act the same way. The main difference is that the value you will be getting is completely based on the real world. For example, event ticketing is becoming one of the best instances of changing the in-person experiences through physical NFTs.
Adding an extra layer of transparency
Purchasing a second-hand collectible can often get challenging as most of the time you get negligible amounts of information on its previous price and market value. Having an NFT, will give you the freedom to get access to a complete overview of the NFT’s transaction history.
Eliminate the risk of counterfeit products
A major advantage of physical NFTs is that they have the ability to prove authenticity and provenance. With a physical NFT, you can easily eliminate the chances of someone counterfeiting your product. With the help of a QR code or NFC technology, businesses can easily link a product’s serial number to an NFT which will help the buyers to check the authenticity of the product as well as track its price history.
How to sell physical items as NFT?
These days, it is safe to claim that practically anything can turn into a token form. Many businesses are already taking advantage of this fact by linking physical assets with non-fungible tokens. When it comes to selling a physical item as an NFT, there are mainly two ways to do so.
You can either take the manual approach, where you need to digitize the artwork you are willing to transform into an NFT in order to sell it on the blockchain. However, if you are selling a physical product that is not art, then it is better to rely on a platform that approaches it manually.
While for artwork, you only need a 2D scanner or a high-resolution photograph to create a digital copy. This gets challenging in the case of a 3D object, as you might need design software or a 3D scanner. Upon digitizing your physical NFT, decide on which blockchain you want to store them. After choosing the blockchain you can mint your NFT that you can sell on various NFT marketplaces like Exchange.art, OpenSea, and more.
The world is moving forward with the gradual adoption of Web3 and blockchain technology in the mainstream. In this scenario, physical NFTs are bridging the gap between physical and digital. By transforming how we interact with real-world products NFTs are doing the impossible. Linking NFTs to physical items has the potential to be a crucial use case of NFTs and blockchain technology.
1. What are the top 5 brands that are selling physical NFTs at present?
Adidas, Gap, RTFKT, Damien Hirst, and Patrón are some of the top brands that have introduced themselves by bringing physical NFTs to the market.
2. What are the steps to selling a physical product as an NFT?
Below are the steps you need to follow to sell a physical product in an NFT marketplace.
- Create a digital wallet
- Select an NFT marketplace
- Buy the cryptocurrency you want to use (for example, ETH).
- Connect the wallet to a reputable NFT marketplace like OpenSea
- Upload the file that you are willing to turn into an NFT
- Set up a fixed price or an auction for the NFT you want to sell.