Image
The boom of NFTs and the future of digital fashion
Selling virtual art or cryptoart as NFTs has been an advantage to artists during the COVID-19 pandemic, among extensive cancellations of shows, concerts, and exhibitions.
The first Chinese song sold as an NFT was purchased for 300,000 yuan ($47,000) at an auction on May 27th: Fu Ying, an actor and singer who is also known by her stage name A Duo, announced on Weibo that she would be auctioning her song “Water Know” as a non-fungible token.
The world’s first ever CryptoArt solo exhibition by Crypto ZR (Liu Jiaying) took place in Beijing until June 13th, following her exhibition at the first CryptoArt-dedicated group exhibition at UCCA Lab last month (we talked about it last week).
But what about fashion? Why should I buy a dress, a pair of shoes, a bag that I will never be able to wear, because it’s digital? How can fashion, a category so reliant on the things we physically wear, have a future in this space?
Actually, the market for virtual fashion, or “crypto clothing”, is rapidly growing.
RTFKT, a virtual sneaker company, designs entirely digital products that can be purchased as NFTs and “worn” using a custom Augmented Reality filter.
As written in the website, “RTFKT uses the latest in game engines, NFT, blockchain authentication and augmented reality, combined with manufacturing expertise to create one of a kind sneakers and digital artifacts. RTFKT is known to be creating viral sneaker designs, memes and collectible exclusives”. A Meta-sneaker can be purchased for $2.000.
Screenshot from RTFKT.com
Like RTFKT, Overpriced.™ considers itself an NFT-first and physical-goods-second brand. Owning the NFT grants unlimited physical replacement hoodies, which the founders say solves a key issue with luxury fashion today: buyers want to show off their purchase, but they don’t want it to get damaged, so they refrain from wearing it. “With our hoodie, you don’t feel like you have to keep it in a box and not wear it,” says James. By the way, they sell it for $26,000.
Overpriced.Tm hoodie – source: Hypebeast.com
It should be noted that the fashion sector is already creating hyper-realistic 3D digital garments in the design and manufacturing process, which has helped promote sustainability and bring new productivity to designers.
Digital fashion allows prototyping so that a designer or brand can experiment with different looks and collections on a screen before they ever start to produce a garment.
However, unlike the physical markets where brands and designers lose out from secondary market sales, NFTs mean that royalties can be programmed to apply for the entire lifetime of an NFT. So each time a digital fashion piece (such as music or art piece) changes hands, the creators always get their share of the copyright, enforced automatically through programming on the blockchain.
Furthermore, their intellectual property rights are also asserted through smart contract programming. A pattern, texture, or garment is completely protected – nobody can simply duplicate it and pass it off as their own.But there is another question for luxury brands: how will companies tie NFTs to physical goods and what could that mean from a legal point of view?
NFT technology provides buyers and brands with a stamp of authenticity. When you create an NFT, you mint a token on a blockchain. You can then include metadata in that token that specifies which smart contract created the NFT, the time and date it was established, and the number of items in circulation — verifying its provenance, point of origin, and scarcity.
To spot a fake, all you need to do is look at the origin of that smart contract and understand if the IP comes from the original provider’s address.
Some luxury houses have already done some steps in this direction, and recently three European rivals joined an “unprecedented collaboration” to help consumers trace the provenance and authenticity of luxury goods.
As reportedby WWD, “LVMH Moët Hennessy Louis Vuitton, which in 2019 initiated the Aura platform, will be joined by Prada Group and Compagnie Financière Richemont in the Aura Blockchain Consortium, which will promote the use of a single blockchain solution open to all luxury brands worldwide. Bulgari, Cartier, Hublot, Louis Vuitton and Prada are already keyed into the platform, which will give consumers direct access to a product’s history, proof of ownership, warranty and maintenance record”.
In 2019 Nike obtained a patent totokenize shoes on the Ethereum blockchain. Nike intends to use the patent to track the shoe holders and use blockchain to verify the authenticity of the shoes.
In the filing published in the U.S. PatentOffice on December 10, this patent named CryptoKicks generates a unique ID and creates an NFT for shoes. In addition to representing virtual sneakers, this NFT can also record its DNA, including specific attributes, colors, styles, and backgrounds.
When consumers buy sneakers, they will also use the 10-digit digital tag attached to the sneakers to link with the buyer's digital identification code to "unlock" and generate a unique NFT. This NFT will represent the buyer's pair of sneakers, basically like a proof of ownership.
When the sneakers are resold to people, the NFT of the sneakers will also be transferred to the new buyer at the same time. These NFTs will be stored in a program called Digital Locker, which is like a cryptocurrency wallet.
But the virtual sneakers might remain just virtual: “In some instances, the CryptoKick may not be originally linked to a physical product, but instead may be gifted to the user as part of a brand promotion campaign, event, moment, or experience”.
Source: USPTO
In June 2019, Gucci revamped its iOS app to include an augmented reality feature that allows users to try on its Ace sneakers virtually. Consumers were able to select a pair of sneakers from the label’s collection, point their phone’s camera at their feet and view an image of what they look like on that can be shared via social, text or email.
Gucci Virtual 25
Recently, Gucci’s Creative Director Alessandro Michele has designed neon-colored sneakers in collaboration with the Belarus-based augmented reality fashion platform Wanna. The Virtual 25, which can be purchased between $9 and $12 on either company’s mobile apps, is designed only to be worn in digital spaces.
However, Gucci’s shoes do not have blockchain authentication. Therefore, despite being exclusively virtual at a cost of $12, the Gucci Virtual 25 are not pure NFTs, but rather a mass virtual product replicable.
According to Hypebeast, inside Roblox’s virtual world, a digital-only Gucci bag sold for more money than the bag’s value in the real world. One user paid roughly $4,115 USD, or 350,000 Robux, for the Roblox-only purse — almost $800 USD more than the real Dionysus Bag with Bee, which sells for $3,400 USD. And it wasn’t even an NFT.
Source: Hypebeast.com
On DressX, customers buy a fashion piece and also submit a photo of themselves, and in return receive a digital photo of them wearing the fashion item.
The founders explain that because often times the goal of fashion is to post a photo to social media, their product gets users quickly to the end goal, all without having ever actually purchased a physical fashion item.
Digital fashion can go beyond traditional fashion design boundaries as designers can explore endless possibilities with digital-only products that do not exist in real life. In addition, digital fashion can offer a new definition of size, body, and gender inclusivity as bits and bytes can come together to create truly universal, genderless, and sizeless garments.
NFTs only makes this process easier, and buyers no longer have to deal with the annoyance of shipping, storing, and even wearing garments.
Any artwork, graphic design, 3D model, video, PDF etc. can become an NFT. But there are limits: it is important for NFT creators to be cautious about incorporating third party IP in their NFT content.
Despite any misperceptions that may exist about traditional law not applying to blockchain technology, the fact is that third party IP rights, including trademark, copyright and design patent can be asserted, and are being asserted, against NFT creators who have not obtained a license or other legal rights to IP included in their NFTs.
Creators of tokenized content should think twice about using a brand name, logo, famous character, picture, video, music or other third party IP without permission.
Just because an IP owner has not yet enforced their IP against creators in the blockchain space, it does not mean that they will not do so in the future. Seeking advice early can help save significant expenses and troubles in the future.
Furthermore, there are some environmental issues that make NFTs non-ecofriendly: like everything on the blockchain, they are very expensive and energy consuming.
While producing a digital-only product (like a virtual garment) means that a physical factory is not needed, transportation and packaging costs are non-existent so that the production costs and time to market are reduced, to create a single NFT takes 263,000Kwh, not to mention the carbon emission. But this is another story.
