Professionals in the luxury goods market have been thinking hard about how to transfer their largely physical business into the new digital era. Non-fungible tokens (NFTs) have proven their worth in guaranteeing the provenance of one-of-a-kind digital assets, but can they also be used to bridge the gap between physical and digital luxury items?
NFTs are a large market: By August of last year, daily sales approached $1.8 billion. It has settled down since then, but it’s no longer unusual for half a billion dollars’ worth of NFTs to trade on a given day. These range from easy-to-mint consumer NFTs such as basketball cards and in-game skins to high-end auctions such as Beeple’s “Everydays: The First 5000 Days” or Pak’s “Merge.”
Creating a luxury NFT is about much more than only creating buzz. Just as in the physical world, it involves vision, craftsmanship, artistry and timing. A recent NFT project created in Malta called “ETH in Mellieha” perfectly exemplifies the level of detail needed to create a luxury NFT. Much more than a digital image, it’s also a physical memento of a real-world experience.
And, unlike many other NFTs, it also incorporates uncontestable legal rights to the physical asset for the owner of the NFT, regardless of the citizenship or current domicile of the holder.
At the core of “ETH in Mellieha” is a prestige license plate issued by Transport Malta. It simply reads “ETH.” The project team hired local artist Debbie Bonello to paint the plate in an invented street scene: a car parked on a narrow street in Mellieha, a small town in the northwest corner of Malta’s main island, with an iconic parish church towering on the horizon. The painting took two months to complete.
Upon completion, the painting was photographed and digitized by the renowned Maltese photographer Matthew Mirabelli and minted as an NFT. A bonfire ceremony was held, where the original painting, its sketches and the flash storage of the JPEG file were burnt and destroyed permanently. Bonello herself placed the painting into the fire. The NFT is now the sole version of the artwork.
A new age in the blockchain-native market for luxuries?
The project has created a new user experience for purchasing a digital asset. While winning an auction is its own unique kind of event, it’s amplified by a documentary as well as social media support via an Instagram page and the @EthMlh Twitter handle. This multimedia approach offers a new way to do visual merchandising in the digital era, analogous to the pop-up showrooms that luxury brands are hosting in the brick-and-mortar space. While the pop-up shop itself is a work of art, the physical goods on sale within were the actual merchandise.
In this way, the art is only one, albeit important, element in the value of the NFT. While Bonello’s work was a one-of-a-kind painting, it’s not what’s being auctioned off. “ETH in Mellieha” is more than a digital art NFT, and it demonstrates how art can be integrated to create a wider, unique experience for the buyer around asset transfers – it’s that experience itself that’s under the gavel.
Ownership of “ETH in Mellieha” conveys not only ownership of Bonello’s image and the only ETH plate on the road in the nation that calls itself “Blockchain Island,” it’s also the story behind it, a story that includes a hilltop bonfire party with artists and dignitaries as the sun sets over the Mediterranean. It’s the first-of-its-kind opportunity for artists to collaborate with the blockchain industry in a way that allows them to create experiences that bridge the gap between the digital and physical worlds.
The auction of the resulting NFT will begin later this year on OpenSea.
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