Why Nike and Adidas bet on NFT's
The hype around NFTs keeps increasing rapidly. Just recently, a digital artwork was auctioned at Christie's and purchased for a ginormous sum of 69 million dollars. The sale of Christie's artwork created a sort of ripple effect and several other NFTs attracted million-dollar buyers. Nike and Adidas are not left out as they both announced big NFTs projects.
Why are companies like Adidas and Nike making these big leaps into NFTs when they’ve avoided other crypto-related projects? Why are NFTs so different and what kind of NFTs should you buy if you’re looking to invest? You’re about to find out!
By the end of this article, you should know more about NFTs, the reason why Textile and Footwear companies like Nike and Adidas have decided to invest, the most expensive and weirdest NFTs that have been sold, and what kind of NFTs you should invest in.
Let’s start with a brief background of what NFTs are. I’m assuming you should know this but I’ll just give a brief rundown of NFTs.
NFTs mean Non-Fungible Tokens. They are unique digital tokens in the blockchain network, that is, non-interchangeable units of data stored on a blockchain, which is a form of digital ledger.
Non-fungible means that it’s unique and can’t be replaced with something else. For example, a bitcoin is fungible because you can trade one for another bitcoin, and you’ll have the same thing but it is the opposite case when it comes to NFTs.
Adidas and Nike are getting into the NFT world and betting big on it by launching huge projects of their own.
Adidas launched a line of NFTs called “Into the Metaverse” which will offer buyers access to what’s essentially a very exclusive fan club. What this means is those holders of these NFTs would get access to exclusive Adidas originals, physical merch, and the promise of future digital goodies.
At first, the physical goods will include the tracksuit worn by Indigo, a hoodie with a blockchain address on it, and an orange beanie.
The merch is co-branded with a trio of collaborators which are: Bored Ape Yacht Club, the highly sought-after NFT collection; Punks Comics, which recently featured Indigo on an issue’s cover; and GMoney, a pseudonymous crypto enthusiast who’s been consulting with Adidas on how to enter the NFT space in a way that feels authentic. I should add that the beanie is supposed to be the one worn by GMoney’s CryptoPunks avatar.
Adidas made a huge profit within hours of its initial sales of the “Into the Metaverse” NFTs In December. 30,000 tokens were made while 29,620 were sold, each worth 0.2 Ethereum which equates to $765.
This means the company earned more than $22 million in less than a day from the sales of these NFTs. It’s unclear if Adidas plans to offer more NFTs in the future, but it teases on its website that “this is just the beginning.” Also, judging from how quickly the first batch sold out and how much money Adidas made in just a few hours, it seems very likely that more NFTs would be sold.
Talking about the other textile and footwear company, Nike; Nike has also shown huge interest in the NFT world by acquiring Artifact. It is pronounced as an artifact but spelled as RTFKT.
RTFKT is a leading brand that uses digital innovation to deliver online collectibles that merge culture and gaming.
Basically, what RTFKT does is make virtual sneakers and other collectibles, and sell those digital creations as non-fungible tokens (NFTs).
According to a statement released by the President and CEO of Nike, John Donahoe, the acquisition would aid Nike’s digital transformation and allow Nike to serve athletes and creators at the intersection of sport, creativity, gaming, and culture.
Nike seems to be following a "fast-follow" strategy as other fashion brands are in a footrace to stake their digital claims in advance of mass adoption of the metaverse. Examples of these fashion brands include Dolce & Gabbana, Jimmy Choo, which have already launched NFTs.
Just recently, three sneakers were launched by Artifact. These sneakers are a collaboration between Artifact and Fewocious (which by the way is an 18-year-old digital artist).
The sneakers were sold for $3,000, $5,000, and $10,000 respectively. In total, 621 pairs were purchased, netting the equivalent of $3.1 million. So, although Nike hasn’t launched any specific project yet, with this huge sale from Artifact, we can expect that Nike would make huge sales in their NFTs.
The question remains though, “ why are so many companies coming to the NFT world?” Tell me in the comment section why you think this is happening.
I know you’re most likely to type to make money. I mean other companies seem to be making a lot of money from NFTs, so of course, everyone would want to make money as well. While this is true, there is also another reason for this. So let’s explore what makes NFTs so profitable for businesses and appealing to the most influential people.
NFTs serves two fundamental purposes. The first is that the data is unique so it cannot be easily replicated. You can easily verify who owns it and the second is that digital information like links can be stored within these NFTs, and this allows them to be associated with virtual and physical assets.
Technically, this means that NFTs act as a sort of unique collectible for whatever is stored inside. This is not the only reason why most companies are coming into the NFT world.
To answer that question, it is FOMO. If you haven’t heard of this term before, it means Fear of Missing Out. It is when everyone seems to be doing something and you’re not in it, you tend to feel like an outsider and so you jump on the trend.
I’m not saying FOMO is the only reason why NFTs are currently trending but it has a huge part to play in it. Also, there is the fact that people love collecting things. Be it comic books, arts, music, anything you name it! And so when you add scarcity to the love of these collections and the fear of missing out, of course, you should expect NFTs to be a buzz.
You can easily drive up the value of your NFTs when you make it a limited edition. That’s how NFTs work. Say this collection is a limited edition and it’s going for this price, then watch people go crazy to get it. Big companies know this and they’re taking advantage of it to make sales.
Now, let’s talk about some of the most expensive NFTs that have been sold.
The first on the list is “The Merge” by Pak. It was sold for a whopping sum of $91,806,519. Pak usurped Koons’s Rabbit and Hockney’s Portrait of an Artist (Pool with Two Figure) and became the world’s most expensive living artist.
The Merge is a singular artwork, but, unlike other NFTs on this list, was sold off by digital art auction website Nifty Gateway in stakes, or units, like shares in a company.
This is what makes “The merge” so unique and allows it to have the title of “the most expensive NFT” to date. In theory, a person with the time and resources could amass all the NFTs of The Merge sold, combining all the artwork into one.
Beeple’s EVERYDAY: THE FIRST 5000 DAYS
The second most expensive on the list is Beeple’s EVERYDAY: THE FIRST 5000 DAYS. This was sold for $69,346,250 at Christie’s New York. The piece was a collage made up of 5,000 individual Beeple artworks created on consecutive days for 13-and-a-half-years. It was also the “first purely digital work of art ever offered by a major auction house”.
CryptoPunk #7523 was also a very expensive NFT sold for 11 million, 754 thousand ($11,754,000). This piece was part of Larva Labs’ collectibles series and is one of nine ‘Alien’ punks. It shows a blue pixelated head with a red beanie and a gold earring.
If you’re looking to go into the NFT world, you should know that almost anything can be sold as NFT. Currently, weird NFTs are being sold like Flying War babies ( a digital artwork sold by Canadian Musician Grimes and ex-girlfriend of Elon Musk). The images are strange. They are babies with wings, armed with swords guarding Mars, and are surrounded by an apocalyptic backdrop. They sold for $5.8 million.
Another weird NFT that was sold is a “Digital toilet paper with flowers”. The digital toilet paper is individually designed with colored flowers and grasses. As an NFT, it is merely a picture, but it costs 4’100 US dollars. Now imagine a digital toilet paper, definitely weird. There are also others on the list like the world’s first digital perfume, a digital NFT stick for dogs, a Nyan cat meme, Jack Dorsey’s first tweet among others.
Just in case you’re wondering what kind of NFTs are the best for you to buy. Well, a good idea would be getting Utility NFTs.
Utility NFTs are NFTs in which you receive a physical piece of art that matches the NFT you purchased; this physical piece could be special access to an event or future use in the digital world, so NFTs don’t necessarily have to be about just digital ownership of an asset.
Some examples of the best NFT projects in 2022 are VeeFriends, Crypto Baristas, Flyfish Club, Women Rise, Properties, Cryptoon Goonz, Invisible Friends, Moon Boyz, Meka Verse, and a lot more but I can’t list all.
Also, you can check out some of the most popular NFT auction platforms such as OpenSea, Rarible, SuperRare, Nifty Gateway, and a host of others to get familiar, just in case you’re looking to sell or buy NFTs.
Tell me what you think about NFTs in the comment section. Would you be looking into buying or selling one?
