NFT has exploded since 2021 and has attracted widespread attention from global capital. From 2021 to 2022, the total market value of NFT has skyrocketed from 70 million to 20 billion! The rise of NFT has provided unprecedented opportunities for many fields such as art, IP rights confirmation, music, sports, etc.! Although NFT has made great progress in the digital field, it is still constrained by some pain points. One of them is the limitation of the virtual world. Although NFT as a digital asset can represent unique works and values, it exists in the digital field and it is difficult to directly touch people's real life. This limitation has become a challenge for the further development of NFT! Therefore, the author believes that if NFT wants to break its development barriers, the next narrative may be the physical link RWA (Real World Asset)!
RWA——Booster for NFT Development
RWA stands for Real World Asset. RWA can include tangible assets that actually exist, such as artworks, precious objects, real estate, jewelry, and cars, as well as financial assets such as stocks, bonds, and commodity futures. The most popular RWAs currently include the following categories: cash (US dollars), metals (gold, silver, etc.), real estate, bonds (mostly US Treasury bonds), insurance, consumer goods, credit notes, royalties, etc.
Compared with digital assets, RWA has more direct physical properties and actual use value. Its asset scale far exceeds that of Crypto Native Asset. For example, the fixed income bond market is about 127 trillion US dollars, the total value of global real estate is about 362 trillion US dollars, the market value of gold is about 11 trillion US dollars, and the current market value of Crypto Native Asset is 1.1 trillion, which is only 1/10 of the market value of gold. If NFT is combined with RWA, it means connecting virtual digital assets with real-world items or assets, which will give NFT authenticity, identity independence and real interactivity, and bring more possibilities for the development of NFT.
The Journey of RWA Exploration in the NFT Field
In fact, the exploration of RWA in the NFT field has begun since 2021! REFTK, which was previously acquired by NIKe, tried it in the early days of the NFT outbreak!
RTFKT was born on the eve of the explosion of the NFT market in 2020. Its early business positioning was to design and produce NFT products such as virtual shoes and virtual clothing. Later, it attracted attention from the outside world for designing various fashionable virtual sports shoes. At the end of 2021, its virtual clothing creation business became popular again because it was acquired by Nike. Strike while the iron is hot, RTFKT launched the CloneX 3D character NFT series in the same year.
Creating people and things, RTFKT's layout began to move towards the virtual fashion industry. Initially relying on virtual shoes, it has gradually grown into a brand ecosystem that integrates blue-chip NFTs, metaverse games, and virtual fashion collections. The virtual clothing it produces has also gone offline, selling the same physical products to players. Each physical product has a built-in NFC "NFC identification tag", which gives the physical product a digital attribute. By identifying the NFC tag, the corresponding NFT can be linked to help users understand the boundary between the digital virtual avatar and the physical identity in the metaverse, and can unlock the corresponding metaverse or real world resources.
In addition to RTFKT, the well-known blue-chip NFT project Azuki has also tried it!
On October 18, 2022, Azuki released a new open source token standard - Physical Backed Token (PBT). The highlight of this standard is that it supports binding real objects to the Ethereum blockchain to achieve decentralized identity authentication and track the ownership lineage of physical objects. At the same time, based on this standard, a model called Scan to Own came into being. Users can quickly transfer PBT from the original owner to the new owner by scanning items with pre-installed chips. This model is committed to realizing the decentralized transfer of ownership of physical objects through integration with hardware, bringing a new experience to users.
In 2023, PUMA also laid out the NFT link RWA track. PUMA and the NFT community Gutter Cat Gang and LaMelo Ball (American men's basketball player, currently playing for the NBA Charlotte Hornets) jointly launched the digital sneakers GutterMelo MB.03 NFT. After purchasing the NFT, you will be able to redeem it for physical sports shoes and digital collectibles within a one-month redemption period starting on July 18, 2023.
Although some projects have already tried to explore the integration of NFT and RWA, the exploration and innovation of NFT and RWA requires more projects to participate in it to create an RWA narrative revolution!
Xreal——Starting the Next RWA Narrative Revolution of NFT
As an infrastructure integrating NFT and RWA tracks, Xreal is setting off a revolutionary wave in the NFT world. Xreal is a service platform focusing on valuable RWA digital products. It provides a one-stop solution from digital products, issuance, trading to redemption. RWA can enter the digital world through the Xreal platform, and achieve a perfect linkage between the digital world and the real world through NFT issuance, opening the way for NFT to link RWA.
XSHOE is the world's first tradable digital sneaker. As the first sports shoe jointly created by XCart.io platform and Bored Ape, it has landed on the Xreal platform and attracted much attention!
XCart is a web3 affordable luxury platform that aims to connect the real world with web3 by restoring creative NFT artworks to real life. XSHOE is the first sports sneaker jointly authorized by XCart.io BTC sneakers and Bored Ape HOLDER BAYC #8698. It is also the world's first tradable digital sneaker. It digitizes a limited edition sneaker to generate NFT, and issues and trades it through the Xreal platform. In the end, sellers can obtain physical sports sneakers by staking NFT on the platform!
XSHOE physical products use BTC elements in product design. Each pair of sneakers contains a unique RFID chip to record the corresponding NFT address and verify the uniqueness of on-chain and off-chain data through NFC! XSHOE digital products have NFT multi-modal attributes: they have the transaction attributes of NFT and the usage attributes of digital products, and can be switched freely! In addition, each pair of XSHOE has its own number and certificate, and can be traced and verified through blockchain technology.
The great era of navigation of NFT linked to RWA is coming!
The narrative revolution of NFT and RWA is surging. The entry of Nike's reftk in 2021, AZUKI's PBT in 2022, and PUMA's brand in 2023, as well as the emergence of Xreal, the infrastructure linking NFT and RWA, means that the great era of RWA navigation is about to come. In the future, more projects will participate in it to explore the new narrative path of NFT and RWA.
Of course, the NFT-linked RWA track also faces some challenges and risks. One of them is the feasibility and standardization of technology. Ensuring the correct matching and information synchronization between NFT and physical assets is a complex task. In addition, ensuring the physical custody and security between NFT and physical objects is also an important consideration.
In general, RWA represents a new direction for the development of NFT, providing a broader space for development in the authenticity and interactive experience of digital assets. With the advancement of technology and the promotion of innovation capabilities, we expect NFT and RWA to bring more innovations and opportunities in the fields of art, collectibles, luxury goods, etc. #NFT