Most NFTs Minted in 2021 Were Totally Useless. Enter Utility NFTs!
NFTs need to be more than just fancy (or crap) art.
Image by Chetraruc from Pixabay
Fans aren’t always looking for more content from you. Increasingly, fans—who are a subset of your entire audience—are interested in experiencing something rare or personalized, something that will provide them unique access, recognition, and status.
Utility-driven NFTs are the best tools to create, control, and give access to those kinds of awesome experiences. And it’s high time for content creators who are Web3 savvy to move toward NFTs that provide real-life utilities to their fans.
The best kind of NFTs are the ones that bring value to their owners’ lives (and aren’t just an expensive jpeg that you use as an avatar).
Five Examples of Utility NFTs that Will Empower Your True Fans To Take Action in the Real World
(1) Access NFTs
Creators can mint NFTs that give their holders access to online experiences, IRL experiences, or even real (physical) goods. Examples including offering your fans access to:
An invite-only event (either digital or in-person) where they can meet you and other fans.
A one-on-one video call with you.
Gated web pages that are token-protected.
Exclusive downloads (e.g. songs not included on your last album).
Fan-only podcast episodes.
Customized prints (e.g. a piece of art with the NFT holder’s name printed on it).
Access to merch example: Shopify now allows merchants to provide consumers access to token-gated stores that sell things—but only if the buyer owns a specific NFT.
Access to live performances example: Cocky Can NFTs provide access to music events in unconventional locations.
(2) Redeemable and Use-Once NFTs
Creators can mint NFTs that allow fans to redeem their NFT for a digital or physical asset. The “redeemability” of those tokens effectively means that they can only be accessed once. After they’ve been redeemed, the token loses its intrinsic value, and the blockchain guarantees traceability of each redemption.
These kinds of NFT could be minted by artists, galleries, auction houses, and brands who want to offer a physical object to the NFT holder.
Redeemable product example: Barry buys an NFT that is a digital representation of a pillow. Barry then redeems that pillow NFT for the underlying product, which is an actual (yep, non-digital) pillow that gets shipped to him via snail mail.
Another example: burning your NFT to redeem a physical pair of luxury sunglasses.
(3) Royalty and Revenue Sharing NFTs
Creators can mint NFTs that reward NFT holders with a share of future profits. At the moment, these are my favorite kind of NFTs. What’s better than creating great content, raising money, and turning your community into stakeholders? What’s better than an NFT that encourages your fans to take action not just for you but with you?
Revenue share example: I recently experienced tremendous success with this model with my own community. In just a few hours, a collection of NFTs related to my podcast, Silicon Carne, all sold out. Each of the 50 Socio NFT holders will share in 25% of the podcast’s NFT revenues during the 2022-23 season.
(4) Governance and Voting NFTs
Creators can also mint NFTs that give their holders voting rights in their community. Generally, one NFT = one vote.
Voting example: People who visit the following mural in Memphis, Tennessee can claim a proof of attendance protocol NFT which acts as a voting mechanism. Then the NFT holder can vote on how monetary donations related to the mural are dispersed (i.e. which charities should get the donations).
Another voting example: I created Aficionados NFTs for the next season of my podcast, Silicon Carne. 30% of the revenue generated with those tokens go into a Community Wallet. Later, the community decides (votes) what to do with this collective treasury.
(5) Experiential NFTs
Creators can also create a series of NFTs that are released progressively (e.g. weekly). As a holder acquires them one by one, they reveal an extraordinary and original work.
Imagine an artist releasing a limited number of copies of creative works such as:
Fragments of an original painting.
Songs within an album.
Episodes of a podcast series.
Chapters of a book.
Only the owners of all the pieces will experience the complete original creation (plus be able to reveal it to the public).
Utility NFTs are the Next Wave
Like I hinted at the top of this article, content creators who provide their fans with real-life utilities linked to their NFTs are going to be pioneers in the NFT space.
Here at Uncut.FM, we strongly believe that more and more creators are going to attach interesting utilities to their NFTs. By doing so, they’ll be able to create true engagement with their fans and drive actions that transcend statistics. (“Oh, you still care about the number of listens, views, likes, and follows? Well, let me tell you about how to create a real community!”)
Those utilities are needed today to create strong digital communities, build loyalty, and establish solid income streams. We want to be the platform that allows creatives like you (DJs, photographers, publishers, streamers, instructors, you name it) to easily create those utilities, and celebrate the value they provide to your community.
We’re already seeing trendsetting creators build these kinds of experiences with Uncut.FM, and we’re here to inspire and support them.
If you think your fans deserve more than just a JPEG, join us (and our Discord community!), and let's make NFTs valuable again.