NFTs have been called everything from fads to outright scams, but early adopters see a future for them as uniquely useful tools for business, health and the arts that goes beyond mere digital collecting.
The non-fungible token (NFT) craze, just over a year old, has given the world works that have sold for millions and includes collections from the “Bored Ape Yacht Club” to an image of a naked Donald Trump following his 2020 election defeat.
This booming world of digital assets has opened up a new market into which tens of billions of dollars have been poured, while also provoking discussions about how they could be useful in the real world.
“NFTs are very rudimentary right now,” said Sandy Khaund, founder of start-up Credenza, which helps companies adopt new technologies based on blockchain, which underlies cryptocurrencies and NFTs.
Beyond the art world, “they don’t have a lot of functionality. They don’t have a lot of utility,” Khaund added.
“Most of them are just monkeys or apes or whatever that do nothing,” agreed Juan Otero, CEO of Travala, an online travel site, in reference to the famous “Bored Apes”.
Yet there is a class of the digital assets bridging the real and virtual worlds.
Starbucks, which will soon launch its own NFTs, sees them as a “programmable, brandable digital asset, that also doubles as an access pass.”
Owning one of the coffee giant’s NFTs, will open access to “unique experiences,” as well as to a “community,” a new vision of a loyalty program, based on the blockchain.
This technology, on which cryptocurrencies and NFTs are based, allows the same token to be used for different applications.
On the institutional side, the tiny republic of San Marino, nestled within Italy, launched a coronavirus vaccine passport in July that incorporates NFT technology.
While the European digital Covid certificate was designed for the European Union, this passport was intended to be able to be verified anywhere, without requiring a dedicated mobile application.
– ‘Guaranteed insanity’ –
Credenza, for its part, is in discussions with sports teams and leagues to set a multi-purpose vision for NFTs.
NFTs and blockchain are “accessible by multiple worlds whether you are physically at the arena ready to go see a New York Knicks game, or you’re ready to go to the metaverse and you want to see a concert there,” said Khaund.
Jenn McMillen of marketing firm Incendio cited rock band Kings of Leon, which have integrated the technology into their work.
As part of the NFT release of their album “When You See Yourself,” the group issued eight “golden tickets,” each of which guaranteed four front-row seats on all of the band’s future tours.
“If you were a brand, think of the most desirable experiences, the most insider-y access, or something that was guaranteed to go viral and just start working backwards from there,” McMillen said.
“(It’s) guaranteed insanity because of the scarcity,” she added.
Among the most successful examples is the travel booking platform Travala, which claims more than 300,000 monthly active users.
The site, which was already accepting cryptocurrency payments, launched the Travel Tiger loyalty program in January.
On the surface, each of the NFTs distributed to existing customers of the platform is a digital drawing of a tiger, reminiscent of the “Bored Apes” designs.
But associated with it is a series of privileges, from entry to exclusive events, in the real world and the metaverse, discounts or loyalty points.
“It’s about retaining these users, making sure that these users continue to use the platform,” said Juan Otero, CEO of Travala.
“For these to really push to mainstream and more traditional corporate players and so on, we’ll probably have to wait another two to three years,” he added.
Regardless, NFTs, in conjunction with growing interest in the metaverse and a decentralized vision for the internet’s future, dubbed web3, are part of building wave of growth.
“The next wave, when it comes, I think is going to be unprecedented,” Otero said.
Inflation ‘shock’ punishes Eurozone economy in June: survey
Economic growth in the eurozone plummeted in June, a key survey showed on Thursday, as high prices took the wind out the strong recovery from the deep lows of the coronavirus pandemic.
The closely-watched monthly purchase managers’ index (PMI) by S&P Global fell from 54.8 in May to 51.9. A figure above 50 indicates growth.
The slowdown, caused by a “cost-of-living shock”, is “the most abrupt recorded by the survey since the height of the global financial crisis in November 2008”, excluding the pandemic lockdown, said Chris Williamson, Chief Business Economist at S&P Global.
Since the beginning of the year, the European economy has recovered strongly from the lifting of restrictions linked to the Covid-19 pandemic, which revived tourism to countries like Spain and Greece as well as transport.
It also benefited from household spending, as consumers burned through savings accumulated during many months of confinement, offsetting the negative impact of the war in Ukraine.
But in June, the “tailwind” of this pent-up demand “is already fading”, Williamson warned.
The latest data “is now consistent with Gross Domestic Product (GDP) growth of just 0.2 percent for the second quarter, compared to quarterly growth of 0.6 percent at the start of the year”, he said.
“The situation is likely to deteriorate in the second half of the year”, he added, raising the spectre of negative growth and recession.
Monkeypox vaccine maker Bavarian Nordic ready to meet demand
As the lone laboratory manufacturing a licensed vaccine against monkeypox, Danish company Bavarian Nordic has seen its order book fill up as the usually rare disease spreads around the world.
“The approval we got in 2019, when we only sold maybe a few hundred doses, all of a sudden became very, very relevant for international health,” the company’s vice president Rolf Sass Sorensen says with a smile at the biotech company’s headquarters in Copenhagen’s harbour.
Bavarian Nordic was caught by surprise by the disease’s sudden spread earlier this year to dozens of countries outside West and Central Africa where it had previously been generally confined.
But Sorensen says he is confident the company can meet global demand even though it only has one production facility.
“With the current demand we can easily supply the global market. We have a couple of million doses in bulk that we can put into vials and make sure that the current outbreak is handled,” he told AFP in an interview.
Bavarian Nordic has an annual production capacity of 30 million vaccine doses.
The Danish company’s smallpox vaccine, marketed as Imvanex in Europe, Jynneos in the US and Imvamune in Canada, is a third-generation serum (a live vaccine that does not replicate in the human body).
It has been licensed in Europe since 2013.
It was designed against smallpox in adults, a disease considered eradicated some 40 years ago, and requires two doses for inoculation.
– World clamouring for vaccine –
According to Sorensen, the vaccine is in stock “in many countries” and can also be used against monkeypox, both before and after exposure to the virus.
“If you are vaccinated a few days after you are exposed, you can also be protected”, he explained.
After getting the green light from the US Food and Drug Administration (FDA) three years ago to use its smallpox vaccine against monkeypox, Bavarian Nordic is now applying to do the same in Europe.
The European Health Emergency Preparedness and Response Authority (HERA), created by the European Commission during the Covid-19 pandemic, has already bought more than 100,000 doses for the 27 EU countries as well as Norway and Iceland.
The first deliveries are due at the end of June for those countries deemed a priority.
The United States has also filled up their stocks with an order for 500,000 doses, in addition to 100 million doses of an older smallpox vaccine previously made by France’s Sanofi but which is known to have some side effects.
Canada and Denmark have also placed orders with Bavarian Nordic.
Other than these announcements made by the countries themselves, Bavarian Nordic — which also makes vaccines against tick-borne encephalitis, rabies, Ebola, Covid-19 and the RS respiratory virus — does not disclose which countries have placed orders.
“But I can say we have procurement requests from all over the world. We have procurement requests from the US, European countries, Middle Eastern countries, Asian countries”, Sorensen said.
The value of the contracts hasn’t been disclosed either, but for Bavarian Nordic it has clearly been a windfall: it raised its 2022 full-year outlook four times in three weeks.
– Rarely fatal –
Despite the rise in monkeypox cases worldwide, the World Health Organization has not recommended that countries mass vaccinate their populations at this stage.
The United States has so far recommended the vaccination of people who have been in close contact with an infected person, while France has recommended a single dose for contact cases in risk groups who were vaccinated for smallpox before 1980.
The European Medicines Agency approved a smallpox medication, Tecovirimat, for treatment of monkeypox earlier this year, but it is not yet widely available.
Most people recover from monkeypox within several weeks and the disease has only been fatal in rare cases.
Symptoms include lesions, eruptions on the face, palms or soles, scabs, fever, muscle ache and chills.
From January 1 to June 15, the WHO registered more than 2,103 cases and one death in 42 countries.
Europe has been the epicentre of the outbreak, with 1,773 confirmed cases, or 84 percent of the global total.
China’s Xi calls for stronger fintech oversight, security
A high-level Chinese government meeting led by President Xi Jinping has called for stronger oversight and better security in financial tech, state media reported, with the sector hit hard by a regulatory crackdown.
The government action has pummelled some of China’s biggest tech firms, wiping out hundreds of billions of dollars in market value since last year.
But with the Chinese economy hammered by Covid lockdowns, the government has rolled out a series of support measures, including a call for “predictable” tech regulation.
“Regarding large payment and fintech platform enterprises, Xi called for efforts to improve regulations, strengthen institutional weak links, ensure the security of payment and financial infrastructure, and guard against and defuse potential systemic financial risks,” according to a readout of the Wednesday meeting by the official Xinhua news agency.
The Chinese leader also “called for these enterprises to be better supported in serving the real economy”, Xinhua said.
The officials at the meeting discussed promoting the “healthy development” of fintech companies, it added, and said “China will tighten oversight” of financial holding firms and internet financial services.
Investors have been heartened in recent weeks by similar statements by the Chinese government, with some perceiving them as signals that the tech crackdown is finally easing.
Hopes also soared this month when dozens of new video games were approved, and tech stocks rose on reports that authorities were wrapping up a cybersecurity probe into ride-hailing giant Didi.
But regulators this month denied reports that they were discussing the potential revival of Ant Group’s scuppered IPO, which would have been the world’s largest public offering at the time.
Ant Group — the payments affiliate of e-commerce giant Alibaba — had its share offering cancelled at the last minute in 2020.
Alibaba was later hit with a $2.75 billion fine over alleged unfair practices.
Ant Group is set to apply for a financial licence as soon as this month, Bloomberg News reported Wednesday, citing unnamed people familiar with the matter.
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