How are NFTs used in fashion and wearables?

NFTs that are revolutionizing the digital resource area

Nonfungible tokens (NFT) are unique digital assets that are embedded in the blockchain and have unique identifiers that can be used to verify their authenticity and ownership. Each NFT has a unique token ID and metadata that makes this process easy.

Their non-fungible nature means that each NFT token is unique and cannot be exchanged for another token on a one-to-one basis. This is in contrast to fungible assets such as fiat currencies, where each unit has the same value and can be replaced with another. Because of this property, NFTs are sometimes used to represent real-world objects such as rare artwork, event tickets, and even real estate.

That said, the meteoric rise of NFTs over the past couple of years has allowed their use to span various industries. While the first NFT was created in 2014, their popularity has grown exponentially since 2021, when the demand for NFT art began to grow. And now the fashion industry is embracing them because of the unique benefits they offer.

Advantages of NFTs in the fashion industry

NFTs bring many benefits to the fashion industry. One benefit is that they enable creators to authenticate the ownership and authenticity of their creations on the blockchain while allowing collectors to acquire the digital assets, which can sometimes be sold for significant profits via NFT marketplaces.

As a result, many prominent fashion designers are now eager to acquire the necessary skills to create NFT designs.

NFTs in fashion have also created new monetization opportunities for designers and creators by giving rise to innovative concepts such as NFT wearables in the realm of virtual reality.

What is an NFT Portable? NFT wearables are digital objects that can be worn by user avatars or virtual characters in digital environments such as metaverses and games. They range from dresses and jeans to wearable NFT jewellery.

What makes wearable NFTs so special is that they allow digital fashionistas to customize their digital personas using virtual items such as clothing and accessories. The digital assets can be acquired, traded and sold within blockchain-based ecosystems. Much of their appeal lies in their ability to enhance users’ virtual experiences.

That said, the value of NFT wearables depends on a number of factors, such as their rarity, desirability, and popularity, among others.

How fashion NFTs are used in augmented reality

Augmented reality (AR) has been hailed as the next frontier in NFT fashion. This is because the technology enables designers to create unique virtual fashion items that can be displayed and worn in augmented reality.

The technology delves a bit into how AR works, making it possible to overlay computer-generated objects onto real environments, creating a holographic effect that integrates them into their surroundings. In the fashion industry, the virtual objects include digital clothing and accessories. AR realism experiences are typically achieved by using AR-enabled devices—such as smartphones, AR headsets, and smart glasses—to provide users with an immersive experience.

By leveraging the advanced capabilities of AR, NFT fashion brands are able to use virtual 3D spaces to showcase their products in a dynamic and realistic manner.

Furthermore, the combination of NFTs and AR allows fashion brands to set up virtual fashion shows and events, giving designers the opportunity to showcase their collections. Such events are usually held on metaverse platforms.

Due to the combined potential of AR and NFTs, a collective of established footwear and apparel companies have partnered with digital fashion specialist agencies to help them exploit the space. The companies include Nike’s RTFKT, Off-White and Adidas.

NFT-powered digital fashion in the metaverse

The metaverse is a virtual world that allows people to connect with their peers and participate in activities analogous to those in the real world, such as work, play, and shopping. Sometimes these cyberspaces also include elements of augmented reality and digital economies.

A major advantage of metaverses is their online availability. Consequently, fashion brands are increasingly turning to them as a convenient alternative to traditional fashion shows when this is convenient.

By leveraging fashion NFTs in virtual environments, fashion companies that have embraced the concept have been able to create immersive avenues for fans and customers to check out their latest offerings. They mainly showcase NFT wearables in the metaverse that give users a higher level of individuality.

Metaverse Fashion Week is an example of a successful metaverse fashion show. The event attracts major fashion companies every year. Famous fashion companies that have participated in the event include Balmain, Dolce & Gabbana, Tommy Hilfiger, Adidas and Coach.

The event – ​​launched in 2020 by the UNXD NFT marketplace and Decentraland, a virtual world platform – also attracts tens of thousands of enthusiasts annually.

In addition to using metaverse fashion events to showcase their creations, some fashion brands are setting up virtual NFT stores within metaverses to make the buying process more interactive, especially during major events. The stores are typically built on virtual land and help increase brand awareness among demographics that appreciate digital world experiences.

How phygital NFTs are used by fashion companies

The use of phygital NFTs, which are NFTs that are paired with physical objects, is a growing trend among fashion brands looking to create a unique shopping experience.

Many fashion brands using this strategy offer limited edition NFTs that are virtual versions of physical items, such as NFT sneakers and jackets. The NFTs, which are bundled with physical products, enable customers to own and carry the item itself while having a digital version of the item on the blockchain.

Among prominent phygital NFT events that have successfully demonstrated their desirability, Dolce & Gabbana’s 2021 Collezione Genesi auction sale of phygital NFTs stands out. The sale of the nine-piece NFT collection set a fashion phygital NFT record after it was sold for approximately $6 million in Ether (ETH). It proved that there was significant demand for phygital NFTs.

Since then, a number of prominent fashion companies have jumped on the phygital NFT bandwagon. One of them is Givenchy. In November 2022, the French fashion company launched a limited edition collection of phygital NFTs in collaboration with Bstroy, a streetwear brand. The unique collection included jeans, T-shirts, hoodies, bags and footwear.

In January 2023, L’Oréal Group’s fashion brand Yves Saint Laurent Beauté also joined the trend along with luxury fashion brands such as Prada. A key reason why fashion brands embrace the phygital NFT strategy is to offer a unique value proposition to customers seeking exclusivity.

An additional benefit of using phygital NFTs is that they help to counter the spread of counterfeit goods. This is because NFTs act as proof of ownership, a factor that validates the authenticity of their corresponding physical items.

The future of NFTs in fashion

The future of NFTs in the fashion industry has significant potential. This is because the segment is expanding in lockstep with the wider NFT market.

Looking at the growth in the last couple of years, the global NFT market size was estimated to be USD 15.54 billion in 2021. Current forecasts indicate that it is likely to reach the valuation mark of USD 231 billion by 2030, mainly driven by the widespread use of NFTs.

Considering these forecasts, NFT technology is poised to attract more users in the long run as it gains traction. This development, in turn, is likely to stimulate the growth of NFT wearable products. Furthermore, the ongoing use of fashion NFTs in creative ways has the potential to increase demand for both virtual and phygital NFTs among digital-couture enthusiasts.