“Digital Collectibles” – Avoid the term “NFTs”

These days, it’s virtually impossible to escape the newfangled, non-fungible token. From the biggest brands on the planet to a host of independent creators online, everyone is in on the action. Perhaps one of the reasons for the enduring popularity of these digital collectibles is the fact that you can do so much with them. Want token-gate access to music festival? Release limited edition collectibles for fans? Selling artwork you’ve never seen before? NFTs can do it all.

However, a quick look at some of the collections that have been rolled out over the past year reveals an interesting pattern. Take the social media platform Reddit which has seen runaway success with NFTs that are airdropped for free and offered for sale to users. These tokens, which showcase the platform’s beloved mascot, Snoo, are not referred to as “NFTs” but rather as “collectible avatars”.

Then there’s iconic band, The Rolling Stones, who join the likes of Madonna and the late Biggie Smalls with the launch of a new NFT collection this month. These will contain never-before-seen photos of the band from the 1960s to the 1990s. These digital assets are created in collaboration with Stones and One of, a web3 company that has spearheaded NFT projects in the past. But strangely, the official announcement does not use the term “NFT”, but rather “Digital Certificate of Authenticity”.

These are just two high-profile cases of digital assets being released that are, for all intents and purposes, NFTs. They are based on blockchain technology, are inherently non-fungible, and in the case of the Reddit avatars, have fetched millions on NFT marketplaces like OpenSea. But despite the obvious, many of these projects seem to go out of their way to avoid the NFT label.

Why this might be

On paper it seems paradoxical; If NFTs are clearly making money, wouldn’t it make more sense to lean more into the industry and embrace the title?

One thing to remember in all of this, however, is that while issuing NFTs is profitable these days, the asset class remains controversial. A quick glance online will see endless videos, articles and social media posts denouncing NFTs as a scam, a fad and everything in between. Some news stories have cast companies and celebrities who have gotten into NFTs as money-grabbers looking to cash in on the public, and then there’s the attitude in some creative circles that NFT-based art isn’t “real” or valid.

This may be the reason why companies and public figures to some extent choose to distance themselves from NFT.

What are the implications of choosing “Digital Collectibles” over NFTs?

At the end of the day, all these efforts to circumvent the term “NFT” in branding come down to stigma (it’s certainly not about financial viability, or these collections wouldn’t be released at all). Unfortunately, these acts of self-preservation only serve to increase the stigma surrounding NFTs.

Because many already casual observers see mainstream companies embracing NFTs as somehow “selling out,” their distancing themselves from the term “NFT” only further signifies that they are something to be wary of. It also suggests that NFTs are not “legitimate” enterprises that “respectable” companies want to be associated with.

Although there have only been a handful so far, we could see even more mainstream companies, public figures and projects issuing NFTs and refusing to call themselves one. If a euphemism for NFTs (say, digital collectibles) becomes the safest way to refer to them in the mainstream, more entrepreneurs may adopt the technology to secure funding and earn the trust of audiences not yet on board the NFT train. Overall, this practice will sideline NFT visibility if it continues and dampen morale further.

What can be done?

There are several options that the NFT sector has in response to this naming debacle. Firstly, projects can and will continue to carry the NFT label. This could be as a means of pushing back or as an organic action (after all, the projects rushing to distance themselves from the term ‘NFT’ are non-NFT focused businesses that are mostly dipping their toes in the water).

The companies with more skin in the game are unlikely to back down and will not distance themselves from the word NFT in order to alienate their core customer base. However, some may see this naming debacle as a chance to “rebrand” the industry. They might see the controversy that has followed NFTs so far as too much of a problem to handle and might even support an industry-wide rebrand (after all, while there is a wealth of content condemning “NFTs”, there is little of such content condemning “digital collectibles”).

Who wins in the end, however, depends on several factors that have yet to be resolved. These include recovery from the ongoing bear market, minor backlash against NFTs, and if this NFTs-but-not-NFT-names trend lasts.

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*All investment/financial opinions expressed by NFT Plazas are from personal research and experience of our site moderators and are intended as educational material only. Individuals are required to research all products before making any type of investment.