Why NFTs are not just for Bored Apes
Talk show host Jimmy Fallon and Charlie Brown fanatic Snoop Dogg may not strike you as being nautical enthusiasts. But both have spent more than $250,000 on membership to the Bored Ape Yacht Club, a non-fungible token (NFT) for a unique digital artwork collection.
Now a group of innovators are trying to sell an NFT that proves your ownership of a real, physical yacht. The buyer of Project Metaverse (pictured) gets a $95m, 63m Delta Marine superyacht designed by naval architect Gregory Marshall .
“When I first heard about the Gregory Marshall NFT new build project, I knew I had to be involved as I feel this will be a revolutionary project and implement a shift in the way yachts are built and sold,” said Alex Clarke, broker at Denison Yachts.
The project team consists of: Denison Yachts, Cloud Yachts and Gregory C Marshall Architects.
NFTs allow businesses to create proof of ownership or attendance. This could be ownership of an asset (either digital or physical) or an experience. Yachting NFTs include both digital and physical.
NFTs are a hot asset class. Sales of NFTs reached $25bn in 2021, compared with $94.9m the year before, according to data from market tracker DappRadar. Yuga Labs, the company behind the Bored Ape Yacht Club, said last week it was valued at $4bn.
The Bored Ape Yacht Club owes much of its success to celebrities buying a collection of NFTs and posting it to their millions of followers on social media. Yacht designers have started selling similar NFTs giving ownership of digital images and virtual yachts.
Attendees at the Palm Beach Yacht Show had the opportunity to buy NFTs from Gregory C Marshall Architects. They were brought to the market by Cloud Yachts and Denison. “Cloud Yachts approached us in late 2021 with a clever concept of minting our superyacht designs as NFTs,” said Gregory Marshall, CEO Gregory C Marshal Architects. “10 Greg Marshall NFTs were quickly sold for 1 ETH [Ethereum – roughly $2,900] each during its debut at Miami International Boat Show. Understanding we were on to something; I began preparing to scale our business with Cloud Yachts.”
There are two types of digital artwork NFT. First, you have one-off visuals that are sold as tokens, just like paintings in the real world. Second, there are NFT collections such as the Gregory Marshall collection. These use a template design and produce variations. In the case of Gregory Marshall collection, there are 26 unique items.
“Superyacht NFTs attract different people for different reasons. It can be a sense of ownership, connection, prestige or simply feeling like you are a part of a club, perhaps much like people are not going to buy a Chanel haute couture dress for £17,000 but will pick up a Chanel perfume bottle for £70,” said Rabya Anwar, fintech, NFT and cryptocurrency specialist, partner, Keystone Law.
Oceanco has also announced three digital yacht NFTs ready for purchase with more planned. “Entering the world of NFTs felt like a natural progression for Oceanco and we wanted to make sure we offered something unique and exciting,” said Paris Baloumis, group marketing director, Oceanco. “Which is why we are putting fun and engagement at the heart of superyacht NFTs. We are making the exclusive more inclusive.”
Anwar, from Keystone Law, agrees. “The ability to make extremely exclusive communities, such as the superyacht world, accessible to everyone makes NFTs inherently democratising and capable of bringing down class and other unfair barriers,” she says. “So, it is no coincidence that NFTs have been gifted to the world by millennials – NFTs clearly embody the values of the millennial generation.”
The main platform where NFTs are displayed and traded is on the aptly named domain, OpenSea. On any given NFT page, its individual properties will be listed with the percentage of NFTs in the collection that share the property. Usually, anything under 5% is considered rare, but that depends on the number of NFTs in the collection.
NFTs, blockchain, distributed ledger technology and cryptocurrency are rapidly becoming more common place in the financial world. The digitisation of physical assets will continue to become more prominent within the industry in turn. It might be worth donning your augmented reality goggles to keep an eye on the metaverse in future.