How Is NFT Used In Digital Fashion And Luxury Goods?

Have you ever thought about making your own NFT clothing? If you're interested in the crypto universe (or not!), as a fashion professional, you should understand how it works and why major fashion houses are already invested in it.

 

Given that NFTs can now be found in non-digital things other than images, audio, and videos, such as memes, gifs, tweets, real estate, and other non-digital things, the appearance of the fashion NFT and those eager to learn how to create NFT clothing comes as no surprise.

 

Digital fashion has made its way from the gaming world and the outskirts of the fashion industry into mainstream cultural discourse in the last few years, as our lives have become increasingly digitized. As the industry adjusts to virtual fashion influencers like Lil Miquela and virtual fashion shows, aided by the pandemic, the next adjustment is fashion's collision with non-fungible tokens (NFTs), which is already underway.

 

The role of NFT in the fashion industry is to create digital fashion that can be traded and authenticated via blockchain. Because digital ownership is tracked, the distinction is in the name—something that is unique and cannot be copied.

 

A Brief Introduction To NFT

 

An NFT is a digital asset that can include art, music, in-game items, videos, and other media. They are purchased and sold online, frequently using cryptocurrency, and are typically encoded with the same underlying software as many cryptos.

 

Despite the fact that they have been around since 2014, NFTs are gaining popularity as a popular way to buy and sell digital artwork. The market for NFTs alone was worth $41 billion in 2021, which is approaching the total value of the global fine art market. NFTs are tokens that can be used to represent ownership of one-of-a-kind items. 

 

They enable us to tokenize items such as art, collectibles, and even real estate. The Ethereum blockchain secures asset ownership; no one can change the record of ownership or copy/paste a new NFT into existence. NFT is an abbreviation for non-fungible tokens. Non-fungible is an economic term that could be applied to your furniture, a song file, or your computer. Because of their distinct properties, these items cannot be substituted for others.

 

NFTs are also typically one-of-a-kind, or at the very least one of a very limited run, with unique identifying codes. "Essentially, NFTs create digital scarcity," says Arry Yu, managing director of Yellow Umbrella Ventures and chair of the Washington Technology Industry Association Cascadia Blockchain Council. This is in sharp contrast to the vast majority of digital creations, which are almost always infinite in supply. Cutting off supply should theoretically increase the value of a given asset, assuming it is in demand.

 

Also Read | NFT Photography: What, Why & How?

 

Digital Fashion and NFT

 

Recently, digital fashion has been discussed in conjunction with the metaverse, a sci-fi concept turned omnipresent buzzword that has been heralded as the internet's future. For example, we will all have miniaturized versions of ourselves roaming the digital landscape in Mark Zuckerberg's metaverse. These virtual avatars will have virtual jobs, virtual social obligations, and virtual clothing. It's still unclear how this Ready Player One-style world will come together.

 

To that end, Silicon Valley has been attempting to persuade Americans to consider – and invest in – things that appear to be more or less fictitious. In comparison to something as speculative as non-fungible tokens, digital fashion appears to be relatively simple to grasp.

 

During the seminar, Maghan McDowell, Innovation Editor at Vogue Business, stated, "Luxury fashion has been known for competition." "What distinguishes technology and sustainability is that it promotes collaboration." Many players must be involved and invested in new technologies in order to create a more digitized and circular fashion industry. McDowell noted that Tommy Hilfiger announced that beginning with the Spring 2022 apparel collections, they will only use 3D design to create, develop, and sell samples.

 

"Blockchain and NFTs are mostly used in fashion to create an environment of complete authenticity," Megan Kaspar, Managing Director at Magnetic Capital, an asset management firm focused on distributed ledger technology, digital, and tokenized assets, explained. Because digital ownership is tracked on the blockchain, a new model of credit and legitimacy is created. As the metaverse expands, this tracking will provide layers of collaborations and piece evolution while tracing back to and fairly compensating the original creator. 

 

However, digital fashion is not limited to avatar clothing. It's a burgeoning fashion subculture that includes digitally designing and modeling real-world clothing, uploading designs for real and digital clothing to the blockchain (so these files can be sold as NFTs), and even digital clothes rendered on real people.

 

There is a widespread belief that digital fashion will one day supplant people's need for real, tangible clothing. According to the thinking, outfit repetition will become an obsolete concern because digital-only clothes exist solely for sartorial performance and self-expression, beyond the constraints of physical reality. (Examples of metaverse clothing include flaming capes, billowing glass-blown dresses, and cloud-like outerwear.)

 

This viewpoint, however, appears to be primarily held by individuals and startups who stand to profit greatly from the growing prominence of digital fashion. Fashion has always made a living by selling fantasies. Is this, however, just another distraction from the larger fashion industry's very real problems? Digital fashion supporters argue that it has the potential to be profitable, practical, creatively rich, and sustainable. Much of this is still up for debate. After all, we're still confined to our flesh suits.

 

How can NFT authenticate Luxury Goods? 

 

NFTs have the potential to transform the way luxury goods are authenticated. NFTs can help to verify the authenticity of high-end products and combat the industry's counterfeit product problem by providing a unique digital signature. NFTs can aid in the authentication of luxury goods by creating a unique digital identity for each item. Each luxury item can be linked to a distinct NFT that contains information about the item's origin, history, and ownership. This can aid in determining whether or not a product is genuine and has not been tampered with or duplicated.

 

In recent years, the fashion and beauty industries have made significant efforts to promote an accurate and unbiased understanding of business changes in order to reinforce new terms consistent with the changes in business today. The advent of NFTs proved to be fashion's only hope of re-boarding the fast-paced tech train, as it had completely missed the boat with E-commerce. When e-commerce first appeared on the scene, I recall a large number of brands that were completely uninterested in moving forward with the new platform. 

 

Another way NFTs can aid in the authentication of high-end products is by increasing supply chain transparency. NFTs can help to ensure that luxury products are ethically sourced and produced by tracking the movement of goods from production to delivery. This can aid in establishing consumer trust and ensuring that luxury goods are not associated with unethical practices such as child labor or environmental damage. 

 

By providing a unique digital signature that can be used to verify authenticity, track ownership and provenance, and improve supply chain transparency, NFTs have the potential to transform the way luxury goods are authenticated. This can help to combat the problem of counterfeit products and ensure that luxury goods are ethically sourced and produced, thereby building consumer trust and protecting the industry's reputation.

 

By creating a unique digital asset that represents ownership of a specific item, NFTs can enable digital ownership of high-end products. This digital asset can be linked to the physical item and stored on the blockchain, creating a digital representation of the item that can be bought, sold, or traded. This enables consumers to own a digital asset that represents ownership of a physical item even if they do not possess it. 

 

NFTs can open up a new market for luxury items by enabling digital ownership of luxury items, particularly in the digital realm. Consumers can buy and sell digital assets representing ownership of luxury goods, opening up new avenues for collectors, investors, and enthusiasts. Additionally, NFTs can enable fractional ownership of high-end products, allowing multiple owners to share ownership of a single item. This could make luxury items more accessible to a broader range of consumers who might not be able to afford the entire item.

 

NFTs have far-reaching potential for enabling digital ownership of luxury goods, opening up new avenues for collectors, investors, and enthusiasts. This could open up a new market for high-end goods, particularly in the digital realm, and make luxury items more accessible to a broader range of consumers.

 

Also Read | Top Metaverse NFTs you need to know about

 

Top ways in which NFT is contributing to Fashion and Luxury Goods

 

Some ways in which NFTs contribute to the growth and development of the fashion industry are listed below.

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Top Ways in Which NFT is Contributing to Fashion and Luxury Goods

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1. Fashion collectibles NFTs:

 

Fashion is a deeply ingrained cultural concept that, among other things, improves people's ability to express themselves. With the metaverse market worth $47 billion, more people are spending time in the virtual world, fueling demand for digital clothing collectibles.

 

Traditional fashion designers are starting to realize that virtual fashion may become the norm in the future. It's no surprise, then, that luxury brands like Gucci are selling digital assets like a bee-embroidered Dionys handbag for $4,115. 

 

Although the bag is not an NFT and has no value or utility outside of the Roblox platform, this move by an industry leader demonstrates luxury fashion brands' intent to invest in and develop the digital goods market. Big brands are minting non-fungible tokens and selling them on digital fashion marketplaces because they provide immutable digital ownership. Luxury brands such as Hublot and Jacob & Co., for example, have created exclusive NFT-based fashion pieces. The Jacob & Co. SF24 Tourbillon timepiece sold for $100,000, making the wristwatch retailer one of the first to successfully launch an NFT watch.

 

2. Fashion shows in the Metaverse:

 

Because of COVID-19-induced lockdowns and travel restrictions, luxury brands have been forced to exhibit their products in virtual worlds. With their virtual fashion shows, major brands such as Christian Dior, Balenciaga, the Prada Foundation, and others have ushered in a digital revolution.

 

At London Fashion Week, Auroboros was one of the first companies to launch a digital-only, ready-to-wear couture collection. The 'Biomimicry' collection was an immersive experience in digital fashion, standing at the intersection of innovative technology and high-class design.

 

Decentraland hosted its first 'Metaverse Fashion Week' in March 2022 in collaboration with the NFT marketplace, UNXD. The four-day gala event featured a number of virtual events such as catwalk shows, panel discussions, digital storefronts, and immersive after-parties. Guests could also purchase physical and digital merchandise from brands such as Hugo Boss.

 

3.  Phygital NFTs:

 

NFTs Phygitalization—the process by which physical products and services integrate seamlessly with the digital world—is gradually affecting the fashion industry. Some of the most prominent fashion brands are now creating twin digital stores to offer both digital and physical collections at the same time.

 

Bulgari, for example, is set to release an exclusive 10-edition Octo Finissimo Ultra watch with an engraved QR code. Owners will be able to access digital art NFTs as well as information to verify the watch's authenticity after scanning the code.

 

In collaboration with digital artist Ferocious, another major brand, RTFKT, sold 600 pairs of real-digital trainers for $3.1 million. Users can wear their physical trainers both in real life and in the metaverse. Nike acquired NFT and blockchain company RTFKT in December 2021 to strengthen its digital transformation strategy.

 

4.  Virtual land purchase:

 

As digital fashion can only thrive in a digital world, it's no surprise that fashion houses are now purchasing virtual spaces. Adidas, for example, paid more than 400 ETH ($1.7 million) for 144 plots of land in The Sandbox metaverse. Users who visit Adidas' Sandbox plots can access exclusive virtual experiences and merchandise.

 

Nike, another digital fashion company, created a virtual space on Roblox called NikeLand where fans can connect and collaborate. Nike headquarters and gaming arenas are present in the immersive 3D metaverse, just as they are in the physical world. 

 

Tag, the floor is lava, dodgeball, and even designing their own mini-games are available to participants. Users can also showcase their NikeLand avatars wearing exclusive Nike fashion NFTs in a digital showroom. They can also buy virtual clothes such as the Air Max 2021, ACG, or Nike Tech Pack.

 

Finally, NFTs can aid in the authentication of luxury goods, combat the issue of counterfeit goods, and enable digital ownership of physical goods. NFTs can also improve supply chain transparency and traceability, which is becoming increasingly important for consumers who value ethical and sustainable procedures. NFTs represent a significant opportunity for brands to innovate and differentiate themselves in a crowded market as the high-end products industry evolves. However, there are some obstacles to overcome, such as the need for industry standardization, education, and adoption.