The NFT sector has not yet returned to the glory of its 2022 heyday, but that has not stopped the technology from evolving.
For example, OpenSea has partnered with music and arts festival group Coachella to launch three NFT collections that offer both virtual and tangible VIP experiences and real-life merchandise.
The partnership will eventually produce three collections that offer different perks and different levels of exclusivity (as well as cost). The first is the VIP Pass + Oasis Lounge Keepsake, which launched on Tuesday at $1,499 each, capped at 1,000 NFTs. This level includes access to a 2024 VIP Festival Pass and its new lounge with “exclusive bar benefits”, including “limited” free drinks.
The next two collections will be released in late March and mid-April, and details on costs and utilities will be shared later, the companies say.
The NFT collections will be powered by the layer-1 blockchain Avalanche, which is the eighth largest NFT blockchain sale in the last 30 days, according to CryptoSlam data. Coachella partnered with Avalanche because they “align with the product” the festival wants to create, but is withholding additional details until later this month, Coachella chief innovation officer Sam Schoonover told TechCrunch.
There have been a lot of NFT collections announced after the term even gained adoption. OpenSea alone has over 2 million collections and 80 million NFTs in its market, according to its website.
So it’s safe to say that this isn’t the first music-related project to offer real-world use cases. But it is a remarkable example of how utility-based NFTs are changing the way outsiders view the web3 domain. The word NFT is simply used to create sometimes overpriced digital profile pictures (PFPs). It is now beginning to refer to digital images that also have online and offline utilities. And this is one of the most promising signs that NFT markets, as their believers say, will find new users and increase their sales.
NFT-based music and ticketed collections are one of the “best ways” for the crypto subsector to gain mainstream adoption, said Devin Finzer, CEO and co-founder of OpenSea. Tickets can have special memories around them for fans, and he believes there is potential for them to be more than just souvenirs or collectibles, but also useful. “So it’s the perfect hybrid for NFTs.”
While OpenSea has done “smaller music-related NFT projects” in the past, this one captures ticketing and VIP access, something Finzer—and others—have been eyeing for a long time.
“Coachella has the audience and distribution to take it to a whole other level,” added Finzer. “The willingness to make this an NFT that’s useful and valuable and something that people will get excited about compared to some of the things that in previous NFT projects were, maybe more half-baked, this is something that’s sophisticated and exciting with real value.”
This partnership could be seen as another push by OpenSea to regain dominance in a saturated market. On January 1, 2022, global NFT sales volume peaked $23.7 billion. Last month, NFT markets saw a volume of $2.21 billion, according to details from Tiexo.
That said, since 2017, OpenSea has traded over $20 billion in volume. But even with that much volume, OpenSea is not the biggest NFT market today. Last month, OpenSea ranked as the fourth largest by volume with 10% market share, or $222.65 million, behind Blur, Magic Eden and OKX, in that order, according to Tiexo data.
This project also makes it easy to buy NFTs using a simple email registration, instead of requiring beginners to get a crypto wallet, buy crypto, and so on. Email sign-ups and credit card ramps are growing trends for the usually unreachable domain.
“For a long time, web3 had a usability problem,” Finzer said. But in the last three to four years, a lot of development has been done to make it smoother for those who aren’t already well-versed in all things crypto. “We’re making it part of the Coachella experience so they can sign up easily and get the NFT easily.”
Schoonover believes many other companies will begin to recognize that NFTs can’t just be collectible images. When he sees them more as unique, collectible digital tickets, he hopes others will want to “experiment with NFTs and the real-world access, benefits and experiences.”
Finzer echoes that sentiment. In general, the theme for NFTs in recent years has expanded beyond collectibles and PFPs to “real-world utility”. Only a subset of people are interested in staying in the world of PFP, but there’s a whole audience of people who may not be so interested in the sentiment of crypto, but see the value in the technology, he added.
“I don’t think the public cares about the technology, whether it’s NFTs or virtual reality,” added Schoonover. “They just want a fun and entertaining experience. . . [and] NFT technology is a unique way to achieve this.”
