2023. Year of the Bridge
Digital fashion X Real-world fashion
Article 1.23
The Virtual-Real blur– are you bullish on it? This party kicked-in in 2022.
‘22 got real serious about the Phygital (Physical+Digital). Phygital products and experiences went way beyond being just NFT merch drops.
This is what happened:
Wearable NFTs (via NFCs)
NFTs as digital twins (I was awaiting this)
Tokenized physical assets as collateral
Virtual Try-ons
2023 promises the phygital to be more consumer intuitive. It builds over the same bricks of ‘22, but with an evident shift from being ‘brand-build centric’ to ‘community centric’. This switch is noteworthy- it reiterates the sentiments of a web3 ecosystem.
It also doesn’t undermine consumer intellect.
The BRIDGE at the turn of ‘23:
Wearable NFTs
Last year saw several web3 heavyweights like Azuki and RTFKT X Nike employ NFC technology in their physical drops, creating the moniker ‘Wearable NFTs’.
Competitors in this field as researched by The Naked Collector-
IYK. A “pull-technology” NFC chip ensures the chip always travels with the physical object. The holder of the physical can always pull the NFT into their wallet by scanning the NFC tag. The NFT cannot be traded on its own. Used by 9dcc, BanklessDAO, PCC.
KONG HaLo. Unlike regular NFC chips, these can sign transactions on the Ethereum network. Used by projects like Azuki, Metafactory and Rags.
RTFKT WM Chip. NFC chip connects to your Web3 wallet. Links specified NFT to physical. In 2023, holders will be able to unlink NFT from the physical item.
Digital Twin NFTs- Physical fashion gets tokenized (NFT’d)
Creating a digital representation of your favorite hoodie on the blockchain, and having it paired with the physical clothing- this is solid impetus for onboarding mainstream labels and marketplaces, in particular luxury, and high-fashion consumers and collectors. My thrill comes from the fact that master handcrafted artistry can now be on-chain(ed).
Building the bridge-
Boson Protocol’s Boson dApp facilitates ‘tokenization, transfer, and trade of any physical asset as an NFT’. Its redeemable NFTs (rNFTs) are smart contracts that manage the rNFT from time of purchase to the time it is redeemed. The rNFT is redeemable for the physical item or currency.
Sept ‘22, Alterrage, a web3 DAO fashion label partnered with Boson Protocol to launch a virtual store with collections that are interoperable across digital, augmented, and physical realities. Know more.
The sweet stuff about physically-backed NFTs:
Tokenization can unlock dormant value from physical assets
Physically-backed NFTs are ideal for Web3 marketplaces trading in collectibles like trading cards, vintage watches and toys, and couture. Basically, physical assets that are meant to be vaulted. These digital twin NFTs are interoperable across the Web3 ecosystem, redeemable at will.
“One of the most compelling use cases for NFTs in DeFi is as a financial instrument in the lending markets. A growing number of protocols are emerging that offer the ability to process loans against NFTs, leveraging the NFT itself as a lien on the collateral. To demonstrate the potential of physical assets in DeFi, we used 4K Protocol to mint a top-of-the-line Rolex Cosmograph Daytona as an NFT and secured a loan from a leading DeFi lending protocol, Arcade.” - 4K Protocol. Know more
Nov ‘22, NFT collector-turned-web3 fashion creator gmoney partnered with Anthony Trotta of Vernon Capital, to give holders of 9dcc’s ITERATION-01 drop, an opportunity to put up their T-shirt and/or NFT as collateral. Know more.
Considering the original mint price of $500, the loan of $125 is not much. But it has unarguably unlocked the latent potential of physically backed NFTs. As gmoney points out, “There’s a lot of dead stock just sitting in closets not being touched. That’s money the owner can’t tap into until they sell them.”
Point well taken.
Phygital re-spells, re-presents luxury
Blockchain technology ethos speaks in terms of luxury and vintage- rarity, provenance, collectability. This is how gmoney redefines luxury in fashion with his 9dcc brand of basic tees- by tokenizing the tees. And of course, by the notably superior quality of production and packaging for his ‘networked products’.
And on-chaining is how MNTGE (min-tij) breathes life into rare vintage wearables. The digital fashion label built around vintage clothing, launched its pilot project late of ‘22, introducing rare vintage candy to the metaverse through digital twins. December 14, hard-core vintage collectors could purchase limited edition MNTGE Passes that granted exclusive early bird access to the physical and digital wearables, and of-course, to their gated Discord channel and airdrops.
Q1 ‘23, MNTGE will release its first physical fashion drops with four collectibles from avid vintage collector and co-founder, Sean Wotherspoon’s personal vintage collection. Going by their social media tease of a 1960s denim jacket and its digital twin in a trunk, with an out-of-place ink bottle, this is definitely a release to watch out for. Know MNTGE more- this is exciting!
Phygital could potentially deliver on sustainability
‘23 is demanding sustainability-focused strategies from brands with phygital products on their roadmap. It is quite a challenge to work the goal realistically (than idealism); interesting how companies address their footprints of overproduction and overconsumption in their build strategy. It needs to be long term, or at least evolve to be.
Cult & Rain have a non-surplus, made-to-order policy mapped for their fashion phygitals. Self declared ‘the first luxury fashion house born from crypto’, Cult & Rain works on zero inventory. Feb last year, the brand debuted with their Genesis Drop- 2,000 4K animated NFTs redeemable for an identical pair of Italian-made luxury sneakers. It was after the last call of trading in the NFTs that production of the handcrafted, personalised physical twins began. Know the luxury label
That’s all for now. Yes, there is more. And there is anticipation for the more that is yet to come.
Stay keen, and thanks for being here!
If you’ve enjoyed this read, let someone know x
This was an amazing read! I learned so much! Thank you for sharing your insight and knowledge!
Hi Rionna, thank you so much for your encouragement . Abso appreciate you x