Should You Jump On Fashion’s NFT Hype?

Luxury fashion, redefined

A decade ago, the popular sci-fi anthology series Black Mirror released an episode called Fifteen Million Merits. In it, the characters would wear identical grey sweatpants in real life but they could dress up their digital avatars in whatever way they want as long as they have “merits” to buy those virtual clothes. At the time, the concept of spending “digital money” to buy digital clothing seemed like a farfetched idea. Who knew that it would take only a decade for a dystopian plot to leak into reality?

The concept in itself is nothing of note now. Dressing up our avatars by buying virtual clothes with real money is something that’s been around for a while. Even brands have taken advantage of this digital fashion boom with labels like UNIQLO, Valentino and Marc Jacobs offering virtual pieces your avatar can put on while gaming. It’s a hit and people love it. And just when you thought nothing about virtual fashion can shock you anymore, NFTs enter the picture.

How NFTs work

The simplest way to explain what an NFT (Non-Fungible Token) is, is to think of it as a prized collectable item similar to an antique piece or an original artwork, but in digital format. In order to be considered as an NFT, it must be something that can’t be exchanged for just any other item (hence, non-fungible). For example, you can replace a dollar with another dollar because they have the same value. However, you can’t exchange an original Van Gogh piece with a duplicate, no matter how similar it is to the original. It’s the same thing with NFTs.

Although anyone can recreate a meme or a digital artwork, it won’t have the creator authentication of the original. However, with the rise of NFTs comes the problem of authenticity. For instance, artist Derek Laufman was impersonated on Rarible. The scammer was able to pass the platform’s verification process and even sold a “fake NFT” to an unknowing buyer before his profile got taken down.

Interested in owning one? You can buy NFTs on different sites like Rarible or Foundation. You’ll need to top up your digital wallet with cryptocurrency such as Ethereum or Bitcoin to purchase. Once you’ve purchased one, it will be recorded in the blockchain, a supposedly unhackable digital accounting ledger that records everyone’s crypto transactions. Once recorded in the blockchain, it will confirm that you’re now the owner of a valuable NFT. Technically, anything digital could be turned into an NFT. It’s just a matter of people finding value in it enough to spend money on. More often than not, prices of items don't just reflect their utility value but their social merit as well.

Fashion enters the world of NFTs

When Nyan Cat was sold for six figures worth of cryptocurrency or when Twitter CEO Jack Dorsey earned USD2.9 million for selling his first tweet as an NFT, the fashion world didn’t take much notice. For a time, NFTs felt too techy for the fashion industry to dive into. Everything changed last February, when the product of a collaboration between 18-year-old digital artist Fewocious and virtual sneaker brand RTFKT Studios sold out in seven minutes and earned USD3.1 million.

Each virtual sneaker came with a physical pair that, yes, you can actually touch and wear. But the thing is, if you do that, it won’t be in mint condition anymore and the value of the shoes will go down. If you want people to check out your purchase, you could just show the virtual sneaker instead. This is one of the allures of purchasing an NFT together with a physical pair. By not using the actual shoes, they retain their original value and you still have a virtual version that you can show off and wear online.

Soon, more fashion-related NFTs began popping up. As recently as last April, Singaporean brand republiqe, which holds the title of the world’s first digital-only luxury fashion label, held an online auction for a bespoke digital avant-garde puffer jacket and a dress. Missed the chance to bid on them? No worries, they have a new collection of Star Wars virtual clothing NFTs. If you manage to outbid everyone else for one of their NFTs, you can send your photo and their “digital tailors'' will “fit” the virtual clothes on your image. Isn’t that strangely awesome?

Another luxury brand that’s dipping its toes in the NFT pond is RIMOWA. Four of their digital artworks — a table, a food cart, a lamp, a sound system with physical counterparts — are up for bids on Rarible. As of this writing, the highest bid for one of the artworks is now at 1 WETH or approximately USD2,697.47.

It looks like Gucci is poised to release NFTs as well; they have already dabbled into selling virtual sneakers which was welcomed with much fanfare.

As you can see, there is really a big potential for creators and artists looking to produce fashion-related NFTs. The best thing about it is even previous works could be auctioned off. Remember designer Anifa Mvuemba’s eerie but mesmerising Pink Label Congo collection featuring 3D-rendered clothing modelled by headless silhouettes? Unique digital fashion pieces like that are prime NFT candidates. Even those virtual fashion show presentations that were created in place of runway shows are also bankable.

For now, most prestige brands have yet to join in the fun. But we bet it’s only a matter of time before many of our favourite clothing brands start offering virtual pieces.

Sustainability issues of NFTs

Are fashion NFTs more sustainable than actual clothing? The truth is that it’s hard to gauge because data on fashion pollution remains murky. But what we do know is that buying NFTs also has its environmental cost and it’s not something that’s negligible. We know it’s surprising considering that digital versions of things (like electronic bill vs. physical bill) are assumed to be more eco-friendly. However, data reports that buying and selling NFTs actually requires a lot of power. A single Ethereum transaction requires electrical energy that’s equivalent to the power consumption of an average household for two days in the United States. That’s quite a lot and it’s something to think about if you want to buy into the hype. However, an alternative system called “proof of stake” is being explored and it’s said to be less harsh on the planet because it has a more centralised system that uses less energy.

At the end of the day, NFTs are an exciting phenomenon that will get you excited but may or may not work out in the long run. Unless you have money to spare, maybe it’s best to wait and see.

Next, learn about the rise of social commerce and live-streaming.

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