<h2 class="wp-block-heading" id="h-topline">TOPLINE</h2>



The Ukraine government and organizations supporting its fight against a Russia invasion have amassed more than $52 million in cryptocurrency donations—and already deployed at least $14 million—amid an influx of support as the country starts accepting a wider array of tokens and digital assets, including proceeds from the sale of one of the most expensive non-fungible tokens in history.



<h2 class="wp-block-heading">KEY FACTS</h2>



Wallet addresses linked to the Ukrainian government and nongovernmental organizations supporting its military have received nearly 60,000 donations since Russian President Vladimir Putin&nbsp;<a href="https://www.forbes.com/sites/joewalsh/2022/02/23/russia-orders-special-military-operation-in-ukraine/?sh=6145da562321">ordered</a>&nbsp;an invasion of Ukraine early Thursday, including an all-time high of more than 10,000 on Wednesday morning, according to blockchain analytics firm Merkle Science.



The donations include $6.5 million in proceeds from a&nbsp;<a href="https://www.coindesk.com/tech/2022/03/02/ukrainian-flag-nft-raises-675m-for-countrys-war-efforts/" target="_blank" rel="noreferrer noopener">Ukrainian flag NFT</a>&nbsp;auctioned off Wednesday by the Ethereum-based group Ukraine DAO—marking the tenth most expensive NFT ever sold, according to Tom Robinson, chief scientist at blockchain analytics company Elliptic.



As of 12 p.m., wallet addresses directly linked to the Ukrainian government have received about $34 million in bitcoin, ether, tron and polkadot, including $5.8 million from Polkadot founder Gavin Wood and a highly sought-after CryptoPunk NFT worth over $200,000, Elliptic&nbsp;<a href="https://www.elliptic.co/blog/live-updates-millions-in-crypto-crowdfunded-for-the-ukrainian-military" target="_blank" rel="noreferrer noopener">notes</a>; the government also started accepting dogecoin Wednesday morning.



On Twitter Wednesday morning, Ukraine’s Kuna Exchange founder Michael Chobanian, whose firm has been helping the country manage the cryptocurrency received,&nbsp;<a href="https://twitter.com/ChobanianMike" target="_blank" rel="noreferrer noopener">noted</a>&nbsp;about $14 million worth of the donations had already been used, with a majority of spending happening exclusively in cryptocurrency transactions.



In an interview with CoinDesk on Tuesday, Chobanian <a href="https://www.coindesk.com/policy/2022/03/01/ukraines-defense-ministry-decides-where-crypto-funds-are-spent/" target="_blank" rel="noreferrer noopener">said</a> funds have gone to Ukraine&#8217;s military and special forces to help purchase equipment, food and gas, but he stopped short of providing additional specifics &#8220;due to a level of secrecy involved.&#8221;



He also said ether and bitcoin—which have represented about 69% of donations, per Merkle Science—were his “preferred” method for spending, given their ease of convertibility.&nbsp;



<h2 class="wp-block-heading">KEY BACKGROUND</h2>



Ukrainian officials took to Twitter on Saturday to&nbsp;<a href="https://www.forbes.com/sites/jonathanponciano/2022/02/26/ukraine-receives-4-million-in-crypto-donations-within-hours-including-19-million-tied-to-julian-assange-nft-auction/?sh=754901853062">ask</a>&nbsp;for cryptocurrency donations to help in the fight against the Russian military after a number of nongovernmental organizations and volunteer groups successfully raised more than $5 million within days. Coming a week after the Ukrainian parliament&nbsp;<a href="https://www.cnbc.com/2021/09/08/ukraine-legalizes-bitcoin-and-cryptocurrencies.html" target="_blank" rel="noreferrer noopener">passed</a>&nbsp;a bill to legalize cryptocurrencies, the donations to Ukraine “add to a trend of nation-states turning to crypto assets as a means of raising funds,” Elliptic noted in a&nbsp;<a href="https://www.elliptic.co/blog/ukrainians-turn-to-bitcoin-to-crowdfund-the-fight-against-russia" target="_blank" rel="noreferrer noopener">report</a>&nbsp;this month. “Iran is using bitcoin mining as a way to monetize its energy reserves, while North Korea is&nbsp;<a href="https://www.bbc.com/news/world-asia-60281129" target="_blank" rel="noreferrer noopener">believed</a>&nbsp;to be stealing cryptocurrency to support its missile development program.”



<h2 class="wp-block-heading">WHAT WE DON&#8217;T KNOW</h2>



Though Ukraine’s government has made use of a large portion of proceeds, it&#8217;s still unclear whether it has yet sold any of the NFTs it’s received. The CryptoPunk donated Tuesday evening reportedly last sold for about $31,300 in February 2021, roughly one sixth of its latest estimated value.



<h2 class="wp-block-heading">SURPRISING FACT</h2>



Despite the booming support in cryptocurrency, the large majority of aid is still expected to come in the form of traditional currency. On Tuesday, the United Nations put out a&nbsp;<a href="https://www.unhcr.org/news/press/2022/3/621e0aa74/un-seeks-us17-billion-humanitarian-needs-soar-ukraine-neighbouring-countries.html" target="_blank" rel="noreferrer noopener">call</a>&nbsp;to raise $1.7 billion for humanitarian support in Ukraine and for refugees in neighboring countries.&nbsp;



<h2 class="wp-block-heading">FURTHER READING</h2>



<a href="https://www.coindesk.com/policy/2022/03/01/ukraines-defense-ministry-decides-where-crypto-funds-are-spent/" target="_blank" rel="noreferrer noopener">Ukraine&#8217;s Defense Ministry Decides Where Crypto Funds Are Spent</a>&nbsp;(CoinDesk)&nbsp;



<a href="https://www.forbes.com/sites/jonathanponciano/2022/02/26/ukraine-receives-4-million-in-crypto-donations-within-hours-including-19-million-tied-to-julian-assange-nft-auction/?sh=754901853062">Ukraine Receives $4 Million In Crypto Donations Within Hours—Including $1.9 Million Tied To Pak, Julian Assange NFT Collection</a>&nbsp;(Forbes)



<a href="https://www.forbes.com/sites/forbesstaff/2022/02/25/bitcoin-donations-to-ukrainian-army-surpass-4-million/">Bitcoin Donations To Ukrainian Army Surpass $4 Million</a>&nbsp;(Forbes)



<a href="https://www.forbes.com/sites/jonathanponciano/2022/02/28/russia-may-use-cryptocurrency-to-try-and-evade-sanctions-but-heres-why-it-will-be-hard/">Russia May Use Cryptocurrency To Try And Evade Sanctions—But Here&#8217;s Why That Will Be Hard</a>&nbsp;(Forbes)

Sakura Bitcoin Exchange Inc. Store in Shibuya

Crypto Donations To Ukraine Top $52 Million As Funds Pour In From Bitcoin, Ether, PolkaDot And NFTs

The NFT craze has minted its first billionaires.&nbsp;



The founders of buzzy blockchain startup OpenSea have joined the three-comma club following a fresh funding round announced Tuesday that values the company at $13.3 billion—up from $1.5 billion just six months ago. With estimated 18.5% stakes in OpenSea, cofounders Devin Finzer and Alex Atallah are each worth about $2.2 billion, Forbes estimates. (Forbes applies a discount to the value of privately-held companies due to limited liquidity. An OpenSea representative declined to comment.)



Founded four years ago, the&nbsp;<a href="https://www.forbes.com/sites/jeffkauflin/2021/11/23/what-every-crypto-buyer-should-know-about-opensea-the-king-of-the-nft-market/?sh=10edd5c62f89">New York City-based startup was an early player in the NFT market that took off in early 2021</a>. Shorthand for “nonfungible tokens,” NFTs are computer files used to track ownership of unique digital assets like art, music and even virtual sports cards on a ledger known as a blockchain. OpenSea bills itself as a peer-to-peer platform on which users can create, buy and sell all sorts of NFTs—in exchange for a 2.5% cut of each sale.&nbsp;



OpenSea has grown rapidly over the past year. In March 2020, the five-person outfit counted roughly 4,000 active users doing $1.1 million in monthly transactions,&nbsp;<a href="https://www.forbes.com/sites/jeffkauflin/2021/11/23/what-every-crypto-buyer-should-know-about-opensea-the-king-of-the-nft-market/?sh=10edd5c62f89">for about $28,000 in monthly revenue</a>. Its luck changed in February 2021, when platforms like the Winklevoss twins’ Nifty Gateway&nbsp;<a href="https://www.forbes.com/sites/michaeldelcastillo/2021/04/05/revenge-of-the-winklevii-facebook-winklevoss-bitcoin-nft-billionaire-revenge/?sh=b87bb51572af">generated buzz</a>&nbsp;by auctioning off high-end digital art. By July, OpenSea had closed a $100 million funding round led by venture capital firm Andreessen Horowitz and recorded about $350 million worth of transactions that month. The next month, transactions hit $3.4 billion—a staggering ten-fold increase that earned the company $85 million in revenue from commissions.&nbsp;



The NFT market cooled off slightly in the months that followed, before heating up again in December. OpenSea&nbsp;<a href="https://dune.xyz/rchen8/opensea" target="_blank" rel="noreferrer noopener">processed more than $3.3 billion worth of sales last month</a>, generating&nbsp;about $82.5 million in revenue for itself. Today, the company employs more than 70 people.&nbsp;



Finzer and Atallah, each around 30 years old,&nbsp;<a href="https://www.forbes.com/sites/jeffkauflin/2021/11/23/what-every-crypto-buyer-should-know-about-opensea-the-king-of-the-nft-market/?sh=10edd5c62f89">have familiar resumes for young tech billionaires</a>. CEO Finzer grew up in the Bay Area, studied at Brown University and took a job as a software engineer at Pinterest. In 2015, he cofounded his first startup, a search engine called Claimdog, before selling it to Credit Karma a year later for an undisclosed sum. Colorado-born Chief Technology Officer Atallah proved to be a spreadsheet whiz from a young age. While he was a student at Stanford, he worked at Palantir, according to his LinkedIn profile, and after graduating worked at Silicon Valley startups Zugata and Whatsgoodly.



In January 2018, the duo teamed up for the Y Combinator startup accelerator with an idea for paying users crypto to share their Wi-Fi hotspots. But CryptoKitties—the cartoonish virtual cats that were among the earliest examples of NFTs—captured their imagination.&nbsp;<a href="https://www.forbes.com/sites/jeffkauflin/2021/11/23/what-every-crypto-buyer-should-know-about-opensea-the-king-of-the-nft-market/?sh=10edd5c62f89">Finzer and Atallah quickly pivoted to launch OpenSea and relocated to New York.</a>



Since its start, OpenSea has raised more than $420 million from investors, according to data from PitchBook. The $300 million series C haul announced Tuesday was led by venture capital firms Paradigm and Coatue. OpenSea says it plans to increase its headcount, with a focus on its “trust and safety” teams, and invest in making its products more accessible to a wider audience.&nbsp;



OpenSea faces heightened competition, including from crypto giant Coinbase, which in October announced plans to launch its own NFT exchange. Critics have also called out the potential for fraud and scams in the NFT world. In September,&nbsp;<a href="https://opensea.io/blog/announcements/employee-information-use-at-opensea/" target="_blank" rel="noreferrer noopener">Finzer requested the resignation of OpenSea’s head of product</a>&nbsp;after he was discovered to be buying NFTs shortly before they went live on the marketplace. And, just last week, a New York art gallery&nbsp;<a href="https://cointelegraph.com/news/opensea-freezes-2-2m-of-stolen-bored-apes" target="_blank" rel="noreferrer noopener">reportedly claimed that $2.2 million worth of NFTs had been stolen from him</a>&nbsp;and listed on OpenSea.&nbsp;



If the company can navigate the choppy waters, even greater riches could be on its horizon. Some $23 billion worth of NFTs exchanged (virtual) hands in 2021, according to data tracked by&nbsp;<a href="https://dappradar.com/blog/2021-dapp-industry-report" target="_blank" rel="noreferrer noopener">DappRadar</a>–and the market is just getting started.



“Our vision is to be the destination for these new open digital economies to thrive,” Finzer said in an emailed statement.



By Eliza Haverstock, Forbes Staff

Screenshot 2022-01-25 at 14.12.10

The First NFT Billionaires: OpenSea Founders Each Worth Billions After New Fundraising

BY TIANA CLINE



IN AN INTERNET ENABLED VIRTUAL WORLD, THERE NEEDS to be a way to own digital items. Non- fungible tokens (NFTs) are already proving this is possible. Locally, the debut collection from artist Norman Catherine fetched $53,000 at Africarare, the first South African VR metaverse.



In November 2021, Nigeria&#8217;s contemporary art fair partnered with Super rare to showcase digital works by African artists such as Linda Dounia and Rendani Nemakhavhani.



Collecting NFTs is becoming increasingly popular but what if you could use something you’ve bought online? Created by Larva Labs, Meebits are one of the first NFT collections to be created as 3D avatars. Avatars are an important part of the metaverse because they’re what will ultimately represent a person, digitally. Microsoft, for example, is adding 3D virtual avatars to Mesh, their new collaborative platform which will enable mixed realities within Teams, as part of their metaverse strategy.



When the collection of (approximately 20,000 different) Meebits launched in May, it sold out in six hours. And to date, the most expensive Meebit has been sold for $222.9K.



“Meebits are algorithmically generated 3D characters linked to NFTs on the Ethereum blockchain. They are rendered in voxels (or pixels with volume) similar to characters from popular games such as Minecraft or Roblox. You can use these NFT characters as metaverse avatars, or in games, and virtual reality,” explains Zhulik the Meebit. “If you purchase a Meebit, you get the 3D model. You can then take the 3D model and animate the avatar in real time using VR equipment such as a headset and controllers or a full body suit.” 



Because Meebits have utility as a 3D avatar, they can be used in various ways which has only added to their growing popularity. 



“For the first time, we have true digital ownership and I believe we are going to see an even bigger wave of creativity and innovation in intellectual property. The exciting thing about NFTs is that this is only the beginning.”

BRITAIN-BLOCKCHAIN-NFT-TOKENS

The Future Of NFTs: ‘This Is Only The Beginning’

<p id="h-startups-are-supposed-to-specialize-but-opensea-s-founders-thrived-by-building-a-wide-open-market-for-creating-and-trading-all-manner-of-nfts-whether-art-music-or-gaming-now-that-they-re-centimillionaires-and-poised-to-become-billionaires-they-have-other-worries-competitors-fraudsters-and-the-next-crypto-crash">Startups are supposed to specialize, but OpenSea’s founders thrived by building a wide-open market for creating and trading all manner of NFTs, whether art, music or gaming. Now that they’re centimillionaires and poised to become billionaires, they have other worries: competitors, fraudsters and the next crypto crash.&nbsp;



In March 2020, as Covid-19 began to spread, OpenSea founders Devin Finzer and Alex Atallah held a gut-check phone call. Their five-person startup had built a platform on which users could create, buy and sell all sorts of nonfungible tokens (NFTs)—computer files used to track ownership of unique digital assets like art and music on a ledger known as a blockchain. Yet 26 months after going live, they had just 4,000 active users doing $1.1 million in transactions a month, which translated (given OpenSea’s 2.5% sales commission) to a paltry $28,000 in monthly revenue. The NFT market had a “dead feeling,” recalls CTO Atallah, who conducted his side of the call from the basement of his parents’ Colorado home, where he had gone to work as New York locked down. Ominously, Rare Bits, a direct and better-funded competitor, had just announced it was folding. The pair set a do-or-die goal of doubling business by the end of the year—and met it in September.&nbsp;



Finally, in February 2021, the NFT market roused from hibernation—and went crazy. In July, OpenSea processed $350 million in NFT trades. That same month, in a round led by Andreessen Horowitz, it raised $100 million in venture capital at a $1.5 billion valuation. In August, as NFT hype (and FOMO) reached a fever pitch, volume spiked tenfold to&nbsp;<a href="https://dune.xyz/rchen8/opensea" target="_blank" rel="noreferrer noopener">$3.4 billion</a>—an $85 million commission windfall for OpenSea in a month when it likely burned less than $5 million on expenses. Although transactions have since retreated to around $2 billion a month, the platform now has 1.8 million active users and a dominant share of the market. It’s up to 70 employees and is scouting for dozens more, including much-needed customer service reps.&nbsp;



Recently, there’s been talk of another round of venture investment at a valuation that could reach $10 billion. With a 19% ownership stake each, CEO Finzer, 31, and Atallah, 29, are centimillionaires on the cusp of becoming crypto’s newest billionaires.&nbsp;



Yet Atallah was humble as he chatted in November at a restaurant in New York’s kitschy new Margaritaville Resort Times Square, sitting near its 32-foot Statue of Liberty replica, which hoists a cocktail instead of a torch. He was there for the third annual&nbsp;<a href="https://www.nft.nyc/" target="_blank" rel="noreferrer noopener">NFT.NYC</a>&nbsp;convention, which boas­ted 5,500 registrants with 3,000 on the waiting list. Young enthusiasts prowled the hotel wearing&nbsp;<a href="https://opensea.io/collection/boredapeyachtclub" target="_blank" rel="noreferrer noopener">Bored Ape Yacht Club</a>&nbsp;sweatshirts—a tribute to a collection of 10,000 simian NFTs whose owners treat it as a social club as much as a collectible or investment.&nbsp;



You might say humility was at the heart of Finzer and Atallah’s successful strategy. Some advisors had urged them to specialize in an NFT niche—say, art, gaming or music. But they opted to build a category-agnostic platform because they didn’t think they were prescient enough to predict which NFT types would catch on.&nbsp;



Beyond casting a wide net, Finzer says, OpenSea has thrived simply by “being in the right place at the right time” and listening to users about what they want. The platform tracks NFTs on ethereum and other blockchains, and all purchases are made in crypto. Sellers can opt for a fixed-price or auction format. Artists can reserve a percentage of each resale price. Ultimately, Finzer sees the NFT ownership verification model working for anything from concert tickets to real estate—he’s just not sure what will succeed when. “I’ve always had a pretty gray view of the future,” he says.&nbsp;



Despite its sudden success, OpenSea faces big and varied risks—from fraud and another NFT market bust to new competition. In October, Coinbase, the nation’s largest crypto exchange and an original investor in OpenSea, announced it will launch its own NFT peer-to-peer marketplace. Within weeks, Coinbase had 2.5 million sign-ups for its waiting list, and CEO Brian Armstrong was predicting the new business “could be as big or bigger” than its core crypto trading business.&nbsp;



OpenSea’s open-market approach heightens the risk of counterfeits, scams and fraud—just ask Amazon or eBay. For example, a scammer can copy an image of someone else’s art and sell it as an NFT on OpenSea. Finzer says the site is working on an automated way to spot fakes and has moderators who investigate suspicious offerings. Still, people can present problems too. In September, Finzer&nbsp;<a href="https://opensea.io/blog/announcements/employee-information-use-at-opensea/" target="_blank" rel="noreferrer noopener">requested the resignation</a>&nbsp;of OpenSea’s head of product after Twitter users&nbsp;<a href="https://twitter.com/0xZuwu/status/1437921263394115584" target="_blank" rel="noreferrer noopener">discovered</a>&nbsp;a crypto wallet linked to that executive was buying NFTs shortly before they appeared on the price-moving OpenSea home­page—in other words, he was allegedly frontrunning his own employer’s decisions.&nbsp;



While they come across as humble, OpenSea’s founders are hardly low on ambition. Raised in the Bay Area by a physician mom and a software engineer dad, Finzer says he was “devastated” to be rejected by Harvard, Stanford, Princeton and Yale. (He settled for Brown.) After a short stint as a Pinterest software engineer, he cofounded his first startup, Claimdog, in 2015 and sold it to Credit Karma a year later.&nbsp;



As a kid, Atallah, the Colorado-born son of Iranian immigrants, made spreadsheets to compare the attributes of everything from birds to brow­sers. After graduating from Stanford, he worked as a programmer before teaming up with Finzer. In January 2018 they entered the Y Combinator startup accelerator with an idea for paying users crypto to share their Wi-Fi hotspots. But at that point, CryptoKitties—the cartoonish virtual cats whose ownership records were digitally inscribed on the ethereum blockchain—had captured the public imagination. “It was the first time people who didn’t really care about crypto were suddenly getting interested in it for reasons other than flipping a coin. I thought that was really powerful,” Atallah says. They quickly pivoted to OpenSea and later moved their operation to New York City.&nbsp;



Much like Beanie Babies, their cloth-and-stuffing ancestors, CryptoKitties turned out to be duds as investment-grade collectibles—the supply was too great to make most of them worth much. After spiking in early 2018, interest in both crypto and NFTs went into hibernation.&nbsp;https://view.ceros.com/forbes/sidebar-2-3-1?heightOverride=741



What awakened the market in early 2021 wasn’t OpenSea’s doing. Instead, platforms like the billionaire Winklevoss twins’ Nifty Gateway&nbsp;<a href="https://www.forbes.com/sites/michaeldelcastillo/2021/04/05/revenge-of-the-winklevii-facebook-winklevoss-bitcoin-nft-billionaire-revenge/?sh=4c2e24a01572">captured attention</a>&nbsp;with curated, high-quality art. Last March, Christie’s auctioned the NFT for digital artist Beeple’s “Everydays: The First 5000 Days”&nbsp;for $69 million, the third-highest price ever paid for work by a living artist.&nbsp;



As NFTs fetched eye-popping prices, more and more ordinary folks decided they too wanted to become creators, collectors or speculators—and turned to OpenSea, with its anyone-can-be-an-artist ethos, built-in secondary market and handy features. For instance, the site has an advanced filtering system so users can find NFTs with the rarest—and theoretically most valuable—attributes. (Only 46 Bored Apes have solid-gold fur, and they command a hefty premium.) When a new NFT is created and recorded on ethereum, the site automatically spawns a webpage displaying it—a nice feature as NFTs became a status symbol, with people sharing their OpenSea pages and changing their Twitter profile pictures to an NFT they own. “It became this circular feedback loop, driven by envy and desire. And OpenSea really captured that market,” observes Richard Chen, a partner at VC firm 1Confirmation and an early OpenSea investor.&nbsp;



Dani, 27, a former fashion designer living in Georgia, has turned a $17,000 investment in NFTs like the World of Women into a portfolio worth $715,000. AJ, a 37-year-old former gaming company CEO from North Carolina, put less than $10,000 into NFTs and now values his digital assets at $1.3 million. He recently convinced his gastroenterologist brother to start buying NFTs. The brother, in turn, hooked his own buddies. “They’re pretty much doing colonoscopies and then checking their phones for new NFT drops,” AJ says.&nbsp;



Sounds like a bubble, all right, raising the question of how OpenSea will fare when it bursts. Responds Finzer: “We have a large amount of padding in case we need to weather a winter.” 



<a href="https://www.forbes.com/sites/jeffkauflin/"></a>By Jeff Kauflin, Forbes Staff

Non-fungible token art.

What Every Crypto Buyer Should Know About OpenSea, The King Of The NFT Market

NFTs have been making waves in the art world, with recent high-profile pieces selling for millions of dollars and high-profile art auctioneers participating in the sales. However, many see the main benefits of NFTs in allowing transparency of ownership and royalties for the artists. One online South African art fair is in agreement, and launched their own NFT offering this week.



Imagine a world where artists earn royalties for every sale of their work in perpetuity, a world where ownership of a piece’s history is public record? With the advent of Non-Fungible Tokens (NFT) transforming the art world globally, that reality is here, and South African art and artists are entering the NFT game along with museums, and looking to transform the way art is bought and sold forever. Confused by what an NFT is? First, we need to understand what is termed ‘the blockchain’, on which NFTs are built. Here’s a simple analogy; your bank processes all transactions between yourself and others, and keeps track of your account balance and those of thousands of others. It also talks to other banks which do the same thing. Now imagine that these transactions are public, and being managed by thousands of different computers across the world – that’s the blockchain. An NFT is a symbol or representation of something that’s unique; imagine you own a jacket for 10 years. You could buy a new jacket of the same make and the same size etc, but it wouldn’t be the exact one you’ve had for 10 years – that’s an NFT. The proof of these transactions and the contracts of sale are built into the blockchain itself, so they can be verified independently.



Think this is too complicated? You’re not alone.



“I’m clueless but excited,” says Koos Groenewald, one half of Jana + Koos, an art and design duo who are participating in South African online art fair Latitudes’ first NFT offering. “It’s like an internal combustion engine. You don’t need to understand how internal combustion works in order to benefit from it.” Latitudes aims to be “the first African marketplace for art-focused NFTs”, and made their first offering in the space yesterday with their Made it to the life raft collection, which offers silk scarves for sale online by eight South African artists. The first 25 people to purchase each scarf receive a free NFT with their purchase. “You can’t really be in the art world right now and not be thinking about NFTs,” says Roberta Coci, Latitudes co-founder in an interview with FORBES AFRICA. In South Africa, some in the art world are excited by the possibilities that NFTs represent, particularly due to the ability to implement what are termed “smart-contracts”, essentially terms of sale or re-sale that are built into the artwork, which have strong implications for authenticity verification and royalties. NFTs in the artworld have hit mainstream news over the last year, with several high-profile sales garnering millions of dollars – today, around 5% of major sales at auction houses such as Sotheby’s and Christies being made up from NFT sales. (Art Market Research, 2021).



Latitudes started examining the space earlier this year. Originally founded as a highly-successful physical art fair which aimed to promote a platform where artists, galleries and independents could come together on an equal playing field, hosting another physical art fair was hampered by the Covid-19 pandemic. Like many others in the industry, Latitudes made the move online. “We launched [latitudes.online] in July 2020 with around 350 artists. Now we are closer to 900 and growing nicely and quickly – we’re basically a third-party marketplace with galleries, artists, curators… as long as you have good art to sell you can bring it on to the platform,” says Coci.



Partnering with NFT experts and social marketplace Momint for the implementation, culminated in yesterday’s ‘soft launch’ of Latitudes’ NFT offering. This democratized ethos fits in well with the benefits that NFTs can bring to the art world; increased transparency of art origination and ownership, as well as perpetual royalties for the artist even after the first sale – preventing the phenomenon of people “flipping” an artwork. “The main gamechanger is that ownership rests with the artists, that you can build the royalties into the smart contract… this way, every time a work is sold, the artist will receive royalties,” says Coci.”Ultimately, it’s a very practical application in the end.”



And indeed, even though the concept of NFTs can be confusing and misunderstood due to the novelty of the technology, participating artists clearly see the possibility of benefits.



“The royalties – they’re sure exciting for me… especially with digital and moving pictures in art. A print is tangible, but if something’s intangible it doesn’t hold the same value. NFTs are bringing up the value of intangible work – and it’s very exciting,” says Groenewald. While Latitudes is amongst the first online art fairs to make an NFT offering, Cape Town-based art Gallery WorldArt also presented an NFT sale earlier this year.



“This is a ground-breaking development in the art world. I am particularly thrilled that this mechanism guarantees artists royalties when their artworks are resold,” says gallery owner Charl Bezuidenhout. Museums, and even rhino-conservation efforts are moving into the space, with a tokenized pen-gun owned by South African anti-apartheid activist OR Tambo and a digital rhino horn going on sale in the weeks to come. “We are still at the early-adopter stage,” says Coci, “But once the hype dies down, we’ll begin to see the real value that NFTs offer.”

NFT CryptoArt displays in art gallery

How The South African Art World Is Entering The NFT Space

“I’m a geriatic Millennial,” laments Alexis Ohanian, the 38-year-old cofounder of Reddit. “Even I don’t understand it all.”



He’s referring not to the online oddities—memes, GIFs, NSFW comment threads— that have turned Reddit into&nbsp;<a href="https://www.forbes.com/sites/abrambrown/2021/02/08/fresh-off-gamestop-mania-reddit-raises-250-million-in-new-funding/">a prosperous virtual hangout spot</a>&nbsp;with over 50 million users. Instead, he’s talking about another topic that takes up a lot of the internet’s attention today: NFTs.



As a guy who’s lived on the web for decades, Ohanian’s being modest, but his comment gets at a core truth. The NFT world is a hard-to-navigate space, full of unfamiliar people, complex ideas and jargon galore, like what even is an NFT. (For the record, it is a non-fungible token,&nbsp;<a href="https://www.forbes.com/sites/abrambrown/2021/02/26/what-is-an-nft-and-should-you-buy-one/">a digital collectible or art</a>&nbsp;bought and sold through online marketplaces.) Ohanian will do his best to work through it all as the cohost of a podcast launching today dedicated to NFTs,&nbsp;<a href="https://itsprobablynothing.xyz/" target="_blank" rel="noreferrer noopener">“Probably Nothing,</a>” available on Spotify and Apple Podcasts, the name a nod to how the virtual asset is often dismissed as fundamentally worthless.



For a cohost, Ohanian has teamed up with another internet enthusiast,&nbsp;<a href="https://www.forbes.com/sites/abrambrown/2020/09/23/everything-youve-wanted-to-know-about-gen-z-but-were-afraid-to-ask/?sh=3425d5cf3d19">24-year-old Tiffany Zhong</a>, whose startup, Islands, offers a platform for digital influencers looking to better monetize their following. The pair originally met at a Y-Combinator hackathon in 2014 when Zhong was still in high school: She went and a built a speed-reading app, he was then a Y-Combinator partner. (Ohanian has also since started his own venture capital firm, Seven Seven Six.) They struck up a friendship more recently after noticing they had similar interests on Twitter.



“We were just exchanging NFT memes with each other, talking about interesting projects. It’s grown out of a conversation we’ve had in our DMs”—their direct messages between each other on Twitter—“for several months,” says Zhong.



They’re not the only ones thinking about NFTs, which have become one of the biggest stories of 2021. A year ago, the digital assets recorded less than $10 million a month in sales. By constrast, $323 million worth of NFTs traded hands on a single day in August, a record unbeaten for now.MORE FOR YOU<a href="https://www.forbes.com/sites/abrambrown/2021/09/23/in-bid-for-growth-a-new-clubhouse-feature-aims-to-increase-private-chats/">A New Clubhouse Feature Aims To Increase Small, Private Chats—And Deeper Engagement</a><a href="https://www.forbes.com/sites/abrambrown/2021/09/22/facebook-apple-privacy-change-software/">Facebook Admits It Reported Faulty Numbers To Advertisers, Blames Apple</a><a href="https://www.forbes.com/sites/petersuciu/2021/09/13/aocs-tax-the-rich-dress--ultimate-fashion-statement-or-display-of-hypocrisy/">AOC’s ‘Tax The Rich Dress’ – Ultimate Fashion Statement Or Display Of Hypocrisy</a>



But as even money and attention has picked up, the space remains seperate from the regulated world of mainstream finance and investment, making it a place uncomfortably rife with speculation and speculators. To defend against any criticism of bias, Zhong and Ohanian say they will be open about their own crypto investments on the podcast and have publicly published links to the digital wallets containing their holdings. “People are starting to looking for more content in this space, to look for people who are not trying to pull a fast one,” Zhong says. “We want to be the go-to space with legitimate guests and topics that span being a collector, a creator and an investor in this space.”



Unsurprisingly, many of those guests aren’t exactly household names, such as Farokh Sarmad, an active NFT investor, and ThankYouX, an artist whose work has been sold by Phillips auction house. Zhong and Ohanian also plan on speaking to people like Keith Grossman, the president of&nbsp;Time&nbsp;magazine, which&nbsp;<a href="https://time.com/5948741/time-nft-covers/" target="_blank" rel="noreferrer noopener">has offered</a>&nbsp;some of its archival covers as NFTs, and Noah Davis, the Christie’s executive who helped established the company as an early mover in this world through&nbsp;<a href="https://www.forbes.com/sites/abrambrown/2021/03/11/beeple-art-sells-for-693-million-becoming-most-expensive-nft-ever/">a record-setting $69.3 million sale</a>&nbsp;of a collage by the artist Beeple in March.



It was around that same time when Ohanian “was talking about the future investment portfolio and how it was gonna look much different,” he recalls. “It’s not going to be just stocks and bonds.”



“The same trends that made Reddit work 16 years ago, are now acting out way more effectively, way faster,” he says, pointing to the speed at which fast online communities can form and flourish today. “And that&#8217;s pretty damn exciting.”



By Abram Brown, Forbes Staff

Web Summit 2018

A New Alexis Ohanian Podcast Hopes To Be A Clarifying Guide To NFTs

By:<a href="https://www.forbes.com/sites/forbesagencycouncil/people/briandevans1/">Brian D. Evans</a> | Forbes Councils Member



<h4 class="wp-block-heading" id="pressboard-ad-sponsorship-tag_1634734872602">Inc 500 Entrepreneur. NFT Enthusiast &amp; Consultant. Founder at <a href="https://www.inc.com/profile/bde-ventures/" target="_blank" rel="noreferrer noopener">BDE Ventures</a>, a marketing and consulting agency.</h4>



Unless you&#8217;ve been living under a rock, such as the EtherRock that recently&nbsp;<a href="https://www.cnbc.com/amp/2021/08/23/people-are-paying-millions-of-dollars-for-digital-pictures-of-rocks.html" target="_blank" rel="noreferrer noopener">sold for&nbsp;</a>$1.3 million, you&#8217;ve probably heard about non-fungible tokens&nbsp;(NFTs). NFTs have become the rage on the internet, offering a novel opportunity for creators, artists and developers. With tons of projects and tokens, the NFT subsector is<a href="https://www.reuters.com/technology/nft-sales-volume-surges-25-bln-2021-first-half-2021-07-05/" target="_blank" rel="noreferrer noopener">&nbsp;worth billions of dollars</a>, making it a fast-growing subsector in the cryptocurrency and blockchain scene.



NFTs aren&#8217;t just valuable economically. They&#8217;re also revolutionary when it comes to branding. Projects such as CryptoPunks, Bored Ape Yacht Club (BAYC), Koala Intelligence Agency, Art Blocks, CyberKongz&nbsp;and many more are changing brand-building approaches.&nbsp;The days of physical brand building, which has helped companies such as Nike, Gucci, etc., create their followings, is being replaced by a digital metaverse with a cult following.



CryptoPunks and BAYC NFTs (both of which I own at least one of) have created communities of core enthusiasts that are rarely seen with mainstream brands. For instance, it&#8217;s rare to find someone changing their profile picture to a new Nike kicks or Patek watch, no matter how valuable those assets are. But on Twitter, you can find many people&nbsp;<a href="https://www.newyorker.com/culture/infinite-scroll/why-bored-ape-avatars-are-taking-over-twitter" target="_blank" rel="noreferrer noopener">changing their profile pictures</a>&nbsp;to avatars of their favorite NFT project.



These vibrant communities help in increasing the value of NFTs. Today, the most popular NFTs are worth more than a small house in some parts of America. For instance, CryptoPunks tokens, pixelated humanoid characters that were&nbsp;<a href="https://www.cnbc.com/2021/05/12/christies-sold-cryptopunks-nfts-collection-for-millions.html" target="_blank" rel="noreferrer noopener">given away for free back in 2017</a>, were worth a minimum of about $400,000 when I wrote this.MORE FOR YOU<a href="https://www.forbes.com/sites/tracybrower/2021/09/19/empathy-is-the-most-important-leadership-skill-according-to-research/">Empathy Is The Most Important Leadership Skill According To Research</a><a href="https://www.forbes.com/sites/carolinecastrillon/2021/09/22/why-us-talent-shortages-are-at-a-ten-year-high/">Why U.S. Talent Shortages Are At A 10-Year High</a><a href="https://www.forbes.com/sites/tracybrower/2021/09/26/you-probably-need-more-friends-heres-how-to-make-them/">You Probably Need More Friends—Here’s How To Make Them</a>



As a consultant with my own agency, I see a lot of projects early on. Every successful NFT project adopts different but similar brand-building strategies. These strategies have helped create a vibrant community for them, which means more awareness and mainstream interest. But despite the current popularity and value of the NFT sector, I think there&#8217;s still plenty of room for improvement in approach and technology.



<h2 class="wp-block-heading">Access And Utility&nbsp;</h2>



NFTs as access passes are a growing theme. This is when owning an NFT gives the holder access to certain benefits. Such benefits range from being part of an exclusive club to real-life benefits such as having access to certain works or events and even access to stories are part of it for some. One interesting case is VeeFriends. (I own a VeeFriend as well.) Gary Vaynerchuk created the collection of 10,255 tokens, and holders will be able to&nbsp;<a href="https://www.prnewswire.com/news-releases/gary-vaynerchuk-releases-his-first-nft-collection-veefriends-301284312.html" target="_blank" rel="noreferrer noopener">attend VeeCon</a>&nbsp;for the next three years.



Here are three access and utility strategies for those getting involved in NFT marketing:



• First, improve access by stacking on the benefits and quality of what the end user gets access to.



•&nbsp;Next, you can improve the technology itself to have NFTs more closely integrated with &#8220;opening the doors&#8221; — meaning nothing else is needed but the NFT itself to physically grant the access.



• Last, the NFT utility that we see today probably won&#8217;t be the utility we see in five years. We&#8217;re in for a lot of innovation in the coming years, and you can capitalize by being more creative than the next person.



<h2 class="wp-block-heading">Rarity And Exclusiveness</h2>



NFTs easily create scarcity, which has made the assets more valuable. For instance, CryptoPunks and BAYC have&nbsp;<a href="https://www.theverge.com/2021/8/26/22639353/cool-cats-bayc-generative-nft-profile-avatar" target="_blank" rel="noreferrer noopener">only 10,000 NFTs each</a>, and this rarity means anyone who owns them is part of an exclusive group. Not only does it make the NFTs more attractive to others, but it also makes the owners want to flaunt them.&nbsp;



BAYC has many different &#8220;traits&#8221; (visual properties) for its 10,000 NFTs. Food for thought for builders would be to make a few hundred NFTs with 10,000 traits or some outrageous change from the current norm.



<h2 class="wp-block-heading">A Die-Hard Community</h2>



NFT projects usually focus on creating a strong community before anything else. They use strategies such as community engagement, opinion polls, extra benefits and more. Gala Games also&nbsp;<a href="https://www.prnewswire.com/news-releases/gala-games-and-opera-announce-multi-level-partnership-to-create-carbon-neutral-nfts-301322430.html" target="_blank" rel="noreferrer noopener">has NFTs</a>, but it takes customer service to new levels and has one of the most engaged and helpful Discord servers I have ever seen.



Establishing communities for NFT projects really comes down to getting buy-in from your audience. Make sure they fall in love with your NFT, story or project. Focusing on your first 1,000 fans can carry you very far in reaching a wider audience.



<h2 class="wp-block-heading">Fun, Interactive And Meaningful Experience</h2>



Another way NFT projects go about brand building is by offering members an interactive and fun experience. Koala Intelligence Agency perhaps does the best job of this, by&nbsp;<a href="https://finance.yahoo.com/news/nft-collection-koala-intelligence-agency-090102495.html" target="_blank" rel="noreferrer noopener">making its tokens &#8220;agents&#8221;</a>&nbsp;and&nbsp;<a href="https://stockhead.com.au/cryptocurrency/nft-alpha-how-to-find-the-next-pudgy-penguins-is-it-koala-intelligence-agency/" target="_blank" rel="noreferrer noopener">giving owners missions</a>. It feels like a secret club that people want to be a part of.



User experience and story buy-in are key. You want NFT owners to feel like they&#8217;re part of the experience. Find ways to make each person feel special, and like they&#8217;re part of the story.



<h2 class="wp-block-heading">The Potential Of NFT Projects</h2>



Given the value that many NFT projects already have, their brand appeal will likely only increase with time, and they can create a metaverse as popular Nike. Already, NFT projects are gaining mainstream interest from celebrities and sports stars.



Even mainstream brands are watching the NFT scene. For example,&nbsp;<a href="https://thenextweb.com/news/nike-blockchain-sneakers-cryptokick-patent" target="_blank" rel="noreferrer noopener">Nike patented CryptoKicks</a>, and other consumer brands such as&nbsp;<a href="https://www.morningbrew.com/marketing/stories/2021/10/06/agencies-are-figuring-out-how-to-safely-guide-brands-through-the-wild-world-of-nfts" target="_blank" rel="noreferrer noopener">Coca-Cola</a>,&nbsp;<a href="https://www.businessinsider.com/taco-bell-potatoes-return-celebrated-with-nft-crypto-collectibles-2021-3" target="_blank" rel="noreferrer noopener">Taco Bell</a>&nbsp;and&nbsp;<a href="https://www.highsnobiety.com/p/asics-nft-sunrise-red-collection/" target="_blank" rel="noreferrer noopener">ASICS</a>&nbsp;have used NFTs as part of their marketing strategies. Similarly, NFT projects are already getting mainstream coverage. For instance, CryptoPunks&nbsp;<a href="https://www.hollywoodreporter.com/business/digital/uta-cryptopunks-nft-film-tv-vieo-games-1235005392/" target="_blank" rel="noreferrer noopener">recently signed a deal</a>&nbsp;with United Talent Agency to let the agency represent the project for TV, games and other media. Thus, NFT projects are already on the path to becoming global brands, led by art, incredible marketing and community building.



If you&#8217;re getting involved in creating and marketing NFTs, the thing to keep in mind is deep involvement from your audience. If you can get your audience on your team and out there championing you in a big way, you&#8217;re much more likely to make it.



<hr class="wp-block-separator"/>



Follow me on&nbsp;<a href="https://www.twitter.com/BrianDEvans" rel="noreferrer noopener" target="_blank">Twitter</a>&nbsp;or&nbsp;<a href="https://www.linkedin.com/in/briandevansla" rel="noreferrer noopener" target="_blank">LinkedIn</a>.&nbsp;Check out&nbsp;my&nbsp;<a href="https://www.inc.com/profile/bde-ventures/" rel="noreferrer noopener" target="_blank">website</a>.&nbsp;<a href="https://www.forbes.com/sites/forbesagencycouncil/people/briandevans1/"></a><a href="https://www.forbes.com/sites/forbesagencycouncil/people/briandevans1/">Brian D. Evans</a>



Inc 500 Entrepreneur. NFT Enthusiast &amp; Consultant. Founder at&nbsp;<a href="https://www.inc.com/profile/bde-ventures/" target="_blank" rel="noreferrer noopener">BDE Ventures</a>, a marketing and consulting agency.&nbsp;<a href="https://profiles.forbes.com/u/a07bec07-5dff-47ea-9653-14b56a7dab7d" target="_blank" rel="noreferrer noopener">Read Brian D. Evans&#8217; full executive profile here.</a>…&nbsp;Read More

Tag: nfts