Much of the initial interest in non-fungible tokens (NFTs) has been sparked by blockchain-based works of art and collectibles as well as in-game items and digital parcels of land. 

The potential role for NFTs though goes much, much deeper than that and leads to the possibility that anything can be tokenised.

For anyone owning, creating or building a physical, commercial product for sale - be it art, clothes, jewellery, furniture, cars, planes, or whatever - that should be a revolutionary concept.

There are several reasons why this idea should appeal to producers of all goods and they become more compelling if the item being produced is only available in limited quantities because that is where the secondary market can determine true value before the NFT is redeemed for the physical item.

This method also provides the holder of the NFT with the opportunity to make a profit by selling to a higher bidder - and triggering a % of the sale back to the creator - or redeeming the NFT to be burnt in exchange for receiving the physical item.

Pioneers of Physical-redeemable NFTs

Maybe the easiest way to understand this concept is to look at one of the pioneering sales taking place right now on the Zora marketplace.

So, for an example of how this works, let's take a look a humble and retro-looking cassette of a limited edition album by the recording artist known as RAC (to his friends and family, he is André Allen Anjos).

Although the cassette may look dated, the artist himself is anything but and André won the GRAMMY award in the category of Best Remixed Recording for Tearing Me Up in 2017.

The tape, called Boy, is a personalised work capturing a specific period of the artist's life and he describes it as, "This album is about growing up. I was tapping into melodies that remind me of that period of my life. Rooted in a sense of nostalgia, growing pains and coming of age...."

According to Zora, "There will only be 100 of these cassette tapes manufactured, and they are being sold using $TAPE—a digital token which represents them. This means that they can be bought, sold and traded like a cryptocurrency. This enables André to realize the true value of his work, and share in the success of the BOY cassette tape with his community."

Launched in May this year, the starting price for the RAC Boy cassette NFT, including shipping costs of sending the tape, was a reasonable $20.

Has the project been a success?

Perhaps a picture from the Zora website today is worth a thousand words...

Blogger Shoutout

For anyone interested in this aspect of emerging commerce, I'd strongly recommend checking out the work of Nichanan Kesonpat, who regularly blogs on developments in this area and was responsible for drawing my attention to Zora and RAC.