The Growing Role of “Physicals” (Physical Components) Within NFT Projects

By Mattijs Devroedt, MD and Strategy Director at monopo London

NFT projects originally grew popular as a way of owning digital goods, however, the maturing of the space has involved the addition of physical goods and experiences that are linked to NFT ownership. These physicals reward the NFT communities with tangible benefits such as custom products, IP certificates, membership to exclusive events or launches.

However, there is a significant difference in how the physical and digital come together for these projects, compared to the phygital trend in traditional goods. Previously, digital components were added to physical goods as a nice-to-have elevation of the physical product. What we see in NFT projects is the physical components are a nice-to-have addition while the digital good is the core item to own.

I am purely an observer, noticing a number of misconceptions about NFTs and highlighting the thought-provoking experiments that are in fact happening. NFTs moving from the digital to the physical space is one very specific box that NFT projects are breaking out of, so it provides an interesting way into the larger conversation.

A collection of NFT artworks

We recently partnered with Matt DesLauriers, one of the leading generative artists, to design an upcoming physical book called Meridian that encapsulates 1000 NFT artworks released on the platform Artblocks, representing abstract landscapes generated by code. It will be a coffee table book with highly crafted finishes that will be gifted to all the owners of Meridians as a physical extension of their NFT.

While generative art has been around for decades, the advent of NFT and blockchain technology have finally given the artform a significant platform. For the first time in history, it is truly possible to own a piece of art where the idea is the code itself. And while NFTs are experiencing a downturn, generative art continues to thrive.

Generative artists are being exhibited in galleries such as Bright Moments or Unit London, while places like Art Blocks are fast maturing into established online platforms to grow the artform further. A book showcasing a generative art collection shows the shift in how this art form is respected. It is a milestone that marks this unique moment in time and will hopefully become a legacy publication.

The addition of this book to the Meridian NFT collection fits with a broader trend that we are seeing in the space. While inherently digital, many NFT projects are adding a physical component that extends the digital work into the physical world. Many projects are now producing exclusive merch for NFT holders, with RTFKT x Nike probably being the most advanced example. Token holders can forge custom sneakers in line with the NFT they hold. The fact that these objects accompany a digital token, opens up a world of possibilities. They are not designed to be sold (and profitable) on their own and instead exist to strengthen the sense of exclusivity and community for the NFT owners.

Becoming part of a community

One thing NFT projects deserve a lot of credit for is their strength in telling stories and speaking to the imagination of its community. The strongest projects roll out as stories that you can be part of. As we move into a hybrid future for NFTs, it’s inspiring to see how the stories and imagination of NFT projects manifest themselves in imaginative real-world formats.

RTFKT have fully mastered the art of storytelling, with forging as a prime example of the world that the brand is building. Forging is the act of redeeming NFTs for new physical (or digital) goods. As a piece of verbal branding, it’s a genius way of turning a very practical act (“redeeming”) into an act of creation. RTFKT owners have been able to forge custom Nike sneakers and Rimowa suitcases.

Another example is The Bright Moments art collective, which has been fantastic at bringing digital art into a physical experience. Purchasers of an NFT token are invited to a real-world minting experience where they witness their artwork being born as part of a private immersive experience. During its recent Crypto Londoner release for example, every token holder individually entered a room where AI-generated music was played on a self-playing piano, while a tiny music box revealed the artwork associated with the token purchased.

Brands are now breaking out the box that was created for them during the hype, which is a very inspiring thing to witness. With less expectations on NFT projects at the moment, organizations can invest more in deeper innovation and experimentation.