Nonfungible tokens (NFTs) seem to be taking over the crypto space as it happened in 2021. Would you be comfortable buying a car that you cannot drive? The latest NFT trend seems to be kicking in. However, some investors are divided on whether the hype will stick around in the long term.
Just before the turn of the 19th century, Carl Benz unveiled what is now mainly considered the first commercial automobile in the world. At that time, it would have been quite impossible to predict how the one product may spur the development of a multi-trillion-dollar sector over the next 100 years – but it did.
From maintenance garages and refueling stations to tech giants like Uber, the world has now created thousands of businesses catering mainly to the concept of car ownership. That, in turn, has resulted in a more profound innovation within the automotive industry, producing various services that are mainly worth much more than the automobile manufacturing sector alone.
Digital ownership is now taking over the internet and as the world continues to make huge strides toward the integration of the general society with technology, blockchain might be how we may shift value from the physical world into the metaverse.
Just like the Benz Patent Motor Car, blockchain-based products are developing a huge range of services that may push the space to new heights, and with nonfungible tokens (NFTs), the worlds of cars and decentralized networks appear to be colliding finally.
The automobile manufacturers are majorly entering the NFTs space that is projected to grow to $240 billion by 2030. These manufacturers are minting unique collectible digital tokens that are at times bundled with car purchases.
These are not small-name brands either, ranging from the collectibles at Arizona-based car auction house Barrett-Jackson and British automotive group MG Motors to the luxury and sports car brands like Lamborghini and Mercedes Benz.
NFTs In Cars Getting Coffee
In 2022, millions of users will sample the early metaverse components that will connect interoperable community-governed networks and propel NFTs to new heights. The metaverse trend has now put NFT markets in the limelight and with the carmakers seeing dwindling sales owing to the pandemic, they are now seeking other alternatives for growth.
Barrett-Jackson auctioned four NFTs in 2021 based on the cars that were sold to raise charity money in March: a 2021 two-door Ford Bronco, the first 2021 Ford Mustang Mach 1 sold for over $500,000, a 2021 Ram 1500 TRX Launch Edition, and a first-edition 2022 GMC Hummer EV. Notably, the NFTs did not come with the cars, but the bids instead competed for the digital rights to the vehicles’ sales.
Announced in April 2021, famous car customization and fabrication shop West Coast Customs launched its CarCoin project, providing a tiered membership program of NFT car-related art. This program, known as FastLane, will also offer NFTs of experiences with A-list celebrity car enthusiasts and fans, along with one NFT for a lucky winner that unlocks a real crypto-themed car.
In December, MG Motors India unveiled 1,111 tokens as part of its launch collection. The company introduced its first NFT on its purpose-built platform, KoineArth’s NgageN. In June 2021, McLaren announced its aim to mint virtual versions of its F1 cars as NFTs.
In December, Mercedes Benz commissioned works of up to five NFT artists to create a collection of art inspired by its G-Class line of vehicles. These artists include Roger Kilimanjaro, Baugasm, Charlotte Taylor, Anthony Authié, and Antoni Tudisco. Mercedes has been proactive in adopting most of the emerging technologies and has also partnered with blockchain startup Circulor to track its supply chain’s cobalt emissions.
Lamborghini is also releasing its first NFT collection which is only accessible using a ‘Space Key.’ These rare Space Keys are carbon-fiber composites that were sent by the premium Italian car brand to the International Space Station in 2019 for research and will provide holders with access to five limited-edition pieces of art.
The car manufacturers know their audience and understand the relevance of quality pop culture specimens that include The Fast and the Furious movies. A Lykan HyperSport was used as a stunt car to fly between skyscrapers in Abu Dhabi during Furious 7. It was sold along with its associated NFT on the RubiX network in May 2021.
An NFT representing the first digital Formula 1 car within the F1 Delta Time blockchain game was acquired by an anonymous buyer Metakovan for $110,000, which translated to 415 Ether (ETH) at the time. He said:
“I could have bought a real car for this.”
With Ethereum’s value having grown considerably since the sale in November 2020, whether the NFTs were worthwhile investments or not is still debatable.
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