Just like many other disruptive technologies that came before it, NFTs started out as toys. While the technology has been popularized as a means to own and flip digital art — think Crypto Punks and Bored Apes — NFTs represent a more serious shift in the way we attribute ownership online.
NFTs effectively make the internet ownable by users, rather than exclusively by platforms like Facebook, YouTube, and Spotify. As a result, more groundbreaking use cases for NFTs are quickly emerging that serve to empower creators, fans, and users in ways that aren’t possible under the economic models we’re used to in web2.
Right now, some of the more promising avenues for NFTs are rooted in the creator economy. By purchasing an artist’s NFT, loyal fans can fund upcoming albums or tours — keeping record labels out of the picture and enabling fans to own a small equity stake in their favorite artist. Corite is a platform that aims to make the entire process easier for both artists and fans.
While NFTs may still be in the later stages of their “toy” phase, new use cases are emerging daily. Thanks to the composability of blockchains, NFT adoption is expanding rapidly and the technology is starting to occupy more relevance in pop culture. It isn’t uncommon for many to showcase their NFT collection within social circles — just as we do with anything we’re proud of.
As these trends accelerate, nonprofits need to be looking towards the web3 ecosystem as an opportunity to fundraise and foster a stronger sense of community amongst donors. Even though most of these organizations have unique missions and objectives, they are effectively competing against each other for a piece of the same pool of resources. Applying for public and private grants can be a painstaking process that consumes a large portion of their time, yet it still remains one of the most significant means of fundraising.
Rather than relying on grants, why not consider fundraising via NFTs — by selling digital collectibles to individuals who care deeply about their mission. Aside from being a new source of funding for these organizations, NFTs can unlock an entirely new revenue model for non-profits.
By configuring the smart contracts that assign ownership and manage the transferability of each NFT, nonprofits can ensure that the proceeds flow back to their organization each time the NFTs change hands on the secondary market. In other words, once the original owner decides to sell their NFT to someone else, the proceeds from the sale could be sent back to the non-profit. This would give rise to a new model of passive income for non-profits while ensuring that the sale of NFTs remain “not for profit” in nature for all owners.