Welcome to the first issue of The Metanomics Weekly, a regular weekly update for Metanomics readers to quickly catch up on what’s happening in the metaverse.
The Weekly Take
The Adidas x Prada x Zach Lieberman experimental NFT project opens today. It asks applicants to submit a piece of original digital artwork in hopes that it will be included in a collage to be auctioned off on the prestigious SuperRare marketplace. As Prada’s first NFT project, it is the latest well-known fashion and luxury brand entering the metaverse — following Gucci (teaming up with Superplastic to make avatars), Nike (acquiring the crypto-native fashion studio RTFKT), and Dolce & Gabbana (selling nearly 6 million USD in NFTs at auction last fall).
Fashion isn’t new to the digital realm. Second Life, the long running virtual world, has always allowed individuals and brands to develop digital clothing for their avatars. Nike launched a collection of digital Air Jordans for Fortnite players back in 2019. Gucci bags can be found in The Sims 4. So what is it about NFTs that has brands suddenly rushing in?
NFTs provide a degree of portability, composability, and longevity that is difficult to reproduce in closed-off digital worlds. Partnerships between brands and platforms tend to be exclusive. Even when it is possible to use assets across platforms, it can be difficult to authenticate ownership. Platforms also tend to not communicate with each other well, making it difficult to combine items into an outfit if issued across independent platforms. And finally, unlike a physical item, there is no guarantee that your goods will survive a platform going out of business or being acquired by a competitor. NFTs, in contrast, have the ability to store the traits, ownership and provenance of digital haute couture on the blockchain separate from any central party. The digital goods instead can become the primitives from which digital spaces can draw. This is especially important for those who want to show off their style across many different digital worlds, from message-based platforms like Twitter, to online games and fully-open 3D worlds like Decentraland.
Chart of the Week
Even in the midst of broader crypto market weakness, the rise of the Bored Ape Yacht Club has felt unstoppable. With a mint price of just 0.08 ETH less than a year ago, the median sale price for a Bored Ape NFT has increased more than 1000 times in ETH value to 90 ETH.
News
Crypto prices continue to show weakness in the face of larger market uncertainty in equities and inflation fears. Both bitcoin and ether have seen significant pullbacks over the past three months — each down about 50% off their highs. It remains to be seen how NFT prices and enthusiasm for crypto-based metaverses hold up, but overall demand continues to be relatively strong.
Following the introduction of NFT verification for Twitter profile pictures, Facebook’s Meta may be gearing up for their own entry into the world of NFTs. Reports suggest that the tech giant is drawing up plans for NFTs to be incorporated into the Instagram and Facebook platforms, which potentially includes a marketplace. With inclusion into two of the largest social media brands and platforms, NFTs are cementing themselves as verifiable signals of social status and community.
Microsoft acquired prominent gaming and metaverse company Activision Blizzard for a record (for a tech acquisition) 68.7 billion USD last Tuesday. This deal includes popular titles such as World of Warcraft and Call of Duty as well as a large esports presence providing what Microsoft calls the “building blocks for the metaverse.”
Upcoming this week in Metanomics
Wednesday, January 26th:
4pm EST - I will be a panelist on “Art Culture in the Metaverse. True Value of Collection” hosted by Connect.Club.
Thursday, January 27th:
3pm EST - Inaugural Metanomics Twitter Spaces interview with NFT42 Founder Jim McNelis (@j1mmyeth) and NFT42 General Counsel Collin Woodward (@StagflationUSA).