…and introducing the Game of Badges!
The Pillar Wallet has recently added support for the Ethereum ERC721 token standard providing users with the ability to manage and transfer crypto collectibles or non-fungible tokens (NFTs) directly in wallet. Although most notably associated with blockchain games like CryptoKitties, at Pillar, we believe there is massive potential for NFTs across multiple use cases including game assets, digital collectibles, financial instruments, physical goods and more. Our first step was implementing support for the OpenSea.io API, the largest marketplace for crypto collectibles. However, we anticipate providing support for other platforms as the uses for NFTs continue to grow.
Blockchains allow us to create unique tokens that represent both digital and physical assets without threat of duplication or alteration. By providing an immutable ledger, they also allow us to track and validate ownership. While most tokens are fungible or mutually interchangeable, ERC721 provides a standard for non-fungible tokens or tokens that are associated with a unique good and its respective value. Many of these goods already have digital representations in the modern world, however, by tokenizing them, we are now able to easily prove authenticity, track ownership and facilitate exchange. The following are a handful of examples where NFTs are currently being adopted and utilized.
Business
There are a number of business applications for NFTs. Users can now tokenize mortgages, deeds, invoices and more. Invoices present one of the more interesting use cases as one can assign payment terms and/or allow for borrowing against earning potential. Centrifuge is one example of a project utilizing NFTs for business. By tokenizing financial documents, they are working to build a decentralized operating system for the global financial supply chain.
Physical Goods
The Codex Protocol is a decentralized registry working to solve the provenance problem for physical goods like art and collectibles. By creating and assigning a secure, digital identity for assets in the form of an NFT, Codex is able to provide a verifiable record and ownership history for each item. This infrastructure will enable various applications from appraisals and insurance to securitization and asset-backed lending. For rare, high value goods, NFTs also provide for fractional ownership, which would otherwise be impossible.
Identity Verification
NFTs can also be used to verify identity and provide better control over personal information. For example, a non-transferrable NFT can be issued upon completion of a Know-Your-Customer process allowing the user to participate in a token sale, restricted investment opportunity or other. As long as the identity token is stored in wallet, it will provide frictionless access to any other platform or service requiring similar verification without duplicating the KYC process.
Tickets + Coupons
Anyone who has ever purchased an event ticket on the secondary market knows that it comes with a myriad of problems. The biggest user concerns are typically the authenticity (is it real?) and validity (has it been used already?) of a ticket. By providing a more reliable ownership and state verification method via the blockchain, NFTs serve as a great media for event tickets and/or coupons.
Gaming
With an expected 2.3 billion gamers across the globe and $137 billion in global revenue this year, gaming revenue is now more than double the global movie (40.6B) and music industries (17.3B) combined. Twitch, the Amazon-owned live streaming website, is the 14th most trafficked website in the US (35th worldwide) and host to 2M individual streamers each month.
The traditional gaming industry is already accustomed to the concept of unique assets such as skins and rare items. A skin is an in-game aesthetic upgrade that changes a character’s appearance, but adds no actual in-game performance attributes. Fortnite, one of the most popular games streamed on Twitch, has raked in $296 million in revenue, primarily from selling skins.
Games like Fortnite feature a closed item system, whereby skins are non-transferable to other players and cannot be sold. Digital goods are trapped inside the game. Items cannot be liquidated and players cannot move their digital inventory to other game platforms. Game developers internally, and non-transparently, dictate an item’s supply, creating uncertainty about asset value.
NFTs allow for transparent verification of supply and authenticity without having to directly trust the game developer. Blockchain-backed assets can even carry over into other game platforms outside of their original design. Players can craft or combine different NFTs to unlock ultra-rare assets or unique access tokens. NFTs can even “own” other NFTs allowing for attribute stacking. By enabling transparent digital scarcity within games, I expect that NFTs in gaming will be one of the primary catalysts for mass user adoption of blockchain technology.
Game of Badges 📛
At Pillar, we have decided to develop our own unique application for NFTs as we believe they can be used to enhance general user experience and signal reputation to the rest of the community. We have implemented an achievement and reward system in the form of badges as non-transferrable NFTs.
Users will receive unique badges for engaging in actions (wallet creation, back up, first transaction, etc.), being a part of a community (Pillar development team, community ambassadors, beta testers, etc) and more. First six badges are already available — learn how to catch them all!
Badges will be non-transferrable and tied to the specific username that achieves them. Not only does this provide a fun gamification layer to wallet usage, but it will help to prevent malicious actors from impersonating, scamming or phishing others. We expect the Pillar badge system to evolve and become an integral part of our platform in the future. Look out for new badge rewards to appear as you continue to use the wallet.
For more information, you can review the details for all available badges and how to obtain them here. More coming soon!