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What’s really behind the craze of NFTs?

Justin Bieber, Jimmy Fallon and Gwyneth Paltrow are among a slew of celebrities who have recently been sued for allegedly duping their followers into buying Bored Ape Yacht Club (BAYC) non-fungible tokens (NFTs). The suit claims the A-listers were secretly paid by the creators of BAYC to “misleadingly” promote the NFTs to their followers in order to artificially pump up their value, resulting in staggering losses for investors.

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For several years I worked in marketing at LEGO, from developing new campaigns for the latest craze, to creating new business models for future experiences and revenue streams.

For any of you who may have needed to reach deep into your pockets to buy yet another set for your children, or even for yourself (I know you’re out there), my apologies if you broke the bank a few times. 

My wife, who is a preschool teacher, would tell me stories of how her students would bring their latest LEGO Ninjago sets to school to show off to their friends and demonstrate their LEGO Ninja spin moves they had learnt from watching our cartoons. As a LEGO marketer, this was the holy grail; after all, we aim for our brand to have ‘social currency’- where kids talk with their friends about their latest LEGO sets, and in return garner the respect and much sought after ‘street cred’ among their peers in the playground.

In 2021 I found myself in a totally new world as I transitioned away from toy building blocks into cryptocurrencies and marketing for NFTs. I saw parallels of how brands like LEGO create cult followings and how NFT collections and communities were achieving the same, but in a surprisingly accelerated manner. For those who may not have gone down this rabbit hole, NFTs are blockchain-based digital records of ownership and authenticity which are currently most represented by art. However, in the future this could evolve into technology of ownership identification used for other verticals like music, property, or even your driver’s licence. 

Bored Ape Yacht Club is one of the most famous NFT collections, represented by 10,000 collectible apes that live on the Ethereum blockchain. The most expensive BAYC NFT sold for a whopping US$3.4 million, with many famous socialites like Justin Bieber spending 500 ETH (US$1.3 million) for a BAYC NFT. American basketball player Stephen Curry arrived early to the party and made his ape acquisition for 55 ETH (US$180K). While I clearly missed the boat on the apes, I have personally experienced minting an NFT (buying an NFT directly from the founding developers) for 0.25 ETH (US$1000), seeing it spike minutes after on the secondary market by 20 times, and falling back to its original valuation 6 months later.

The natural question to ask here is; “Why in the world would someone spend even $1 on a picture, let alone $1 million?” Why would Walt Disney CEO Bob Iger back an NFT digital avatar platform as an advisor on its board of directors? The long and short of it is: social currency. Having a BAYC NFT is like holding a membership to the most prestigious golf club on the planet, getting to mingle and establish connections with others in the club for social and business purposes. When I am hanging out in a digital server and see someone with a BAYC profile picture drop into the chat, I immediately feel I am in the presence of greatness – attributed to the wealth they may have to afford one, or the smarts and savviness to have acquired one before it rocketed to the moon. 

The reality is that we all inherently have a deep-seated human need to belong, and to have social validation of our worth from others. We can see the parallels of a child seeking that nod of approval from their friend at the playground because they have the latest toy, to the NFT degenerate who gets the social affirmation of thousands on Twitter as the world hangs from the words uttered by their ape profile picture.

Unfortunately and fortunately, our worth and value are not rooted in the achievements we’ve attained or the possessions we’ve added to our name (which, as many can attest to, is an ever fleeting game that never truly satisfies). In the Bible, we find an astonishing alternative to meaning and identity. Ancient scripture talks about the doctrine of ‘imago dei’, a concept that God created us in his own image and likeness, reflecting his moral, spiritual, and divine nature. Rather than basing our identity on what we’ve achieved or how others perceive us, the Christian message invites us to root our meaning in being created and fashioned by a God who values us beyond measure. And in so doing, transforms the status of the things of this world into gifts to be enjoyed- rather than metrics of self-worth.

Whether it’s BAYC NFTs, BMWs, or the latest LEGO set- these are all wonderful creations to be enjoyed and shared, but are they the social currency we’re looking for? Perhaps it’s this desire for validation that points us to something else entirely.

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