Where are we now in the hype cycle for NFTs? The industry zoomed up to the peak of inflated expectations then swooped down into the trough of disillusionment like some kind of crypto rollercoaster. Which either means we’re in for a ‘coaster disaster like coming off the tracks or getting a goose in the face, or more hopefully – if we’re following Gartner’s hype cycle pattern – a gentle slope of enlightenment towards mainstream adoption.
There are certainly some big companies getting involved in NFTs though. Two examples from the entertainment industry this week show that. Artist SZA has dropped her first NFT collection, based on the fourth anniversary of her debut album, and working with music/tech startup Fanaply. but it’s the other partner that’s interesting: American Express.
But yes, if you think that brings with it a requirement that people use Amex cards to buy those NFTs, you’d be right. Not that many people had the chance to dig those cards out of their wallets. Only 14 NFTs, each costing $100 and based on a moment from SZA’s recent American Express-backed concert, were made available, and they have all sold out.
Paying for NFTs with standard credit cards rather than cryptocurrency could open up this space to many more buyers, but over-scarcity works against that. Still, if the SZA drop is an experiment that paves the way for traditional finance firms to do more in this space, that could be good.
Talking of opening this up, it’s worth taking a look at what Warner Bros has done this week with NFTs for its new film ‘Space Jam: A New Legacy’. It has released 91,000 of them, featuring the film’s lead Lebron James, and his Looney Tunes co-stars – Bugs Bunny, Porky Pig and so on.
Warner Bros worked with NFT marketplace Nifty’s on the drop, which interestingly had a free element, with fans able to get a free NFT by signing up, and another for sharing on social media. After that, it’s a loot-box model: people paid $2.99 to get a “randomly selected” NFT from the collection, with a limit on buying one per day. The first drop has sold out, but more collectibles are on the way.
Companies like American Express and Warner Bros getting involved in NFTs, working with high-profile musicians and movie stars (and medic-questioning rabbits), could do a lot to bring digital collectibles further into the mainstream.
That said, these drops will be many people’s first experience of an NFT, so if they are disappointed – whether that be realising there were only 14 to buy, or that the random selecter has chucked them a Tweety Pie when they wanted a Tasmanian Devil – there are risks too. Still, if this really is a slope of enlightenment, learning from mistakes as well as successes will be important.
Get A Free Music Ally Account
Access unlimited News articles on the site, PLUS a trial of Music Ally’s subscriber-only services, including our industry-leading daily Bulletin email.