In this essay, I studied REAL NFT use examples and their potential uses.

Knowledge of the Hype Cycle

Gartner's Hype Cycle.

It proposes 5 phases for disruptive technology.

1. Technology Trigger: the emergence of potentially disruptive technology.

2. Peak of Inflated Expectations: Early publicity creates hype. (Ex: 2021 Bubble)

3. Trough of Disillusionment: Early projects fail to deliver on promises and the public loses interest. I suspect NFTs are somewhere around this trough of disillusionment now.

4. Enlightenment slope: The tech shows successful use cases.

5. Plateau of Productivity: Mainstream adoption has arrived and broader market applications have proven themselves. Here’s a more detailed visual of the Gartner Hype Cycle from Wikipedia.

In the speculative NFT bubble of 2021, @beeple sold Everydays: the First 5000 Days for $69 MILLION in 2021's NFT bubble.

@nbatopshot sold millions in video collectibles.

This is when expectations peaked.

Let's examine NFTs' real-world applications.

Watch this video if you're unfamiliar with NFTs.

Online Art

Most people think NFTs are rich people buying worthless JPEGs and MP4s.

Digital artwork and collectibles are revolutionary for creators and enthusiasts.

NFT Profile Pictures

You might also have seen NFT profile pictures on Twitter.

My profile picture is an NFT I coined with @skogards factoria app, which helps me avoid bogus accounts.

Profile pictures are a good beginning point because they're unique and clearly yours.

NFTs are a way to represent proof-of-ownership. It’s easier to prove ownership of digital assets than physical assets, which is why artwork and pfps are the first use cases.

They can do much more.

NFTs can represent anything with a unique owner and digital ownership certificate. Domains and usernames.

Usernames & Domains

@unstoppableweb, @ensdomains, @rarible sell NFT domains.

NFT domains are transferable, which is a benefit.

Godaddy and other web2 providers have difficult-to-transfer domains. Domains are often leased instead of purchased.

Tickets

NFTs can also represent concert tickets and event passes.

There's a limited number, and entry requires proof.

NFTs can eliminate the problem of forgery and make it easy to verify authenticity and ownership.

NFT tickets can be traded on the secondary market, which allows for:

1. marketplaces that are uniform and offer the seller and buyer security (currently, tickets are traded on inefficient markets like FB & craigslist)

2. unbiased pricing

3. Payment of royalties to the creator

4. Historical ticket ownership data implies performers can airdrop future passes, discounts, etc.

5. NFT passes can be a fandom badge.

The $30B+ online tickets business is increasing fast.

NFT-based ticketing projects:

• @GetProtocol

• @SeatlabNFT

• @YellowHeartNFT

• @GUTStickets

• @WicketEvents

Gaming Assets

NFTs also help in-game assets.

Imagine someone spending five years collecting a rare in-game blade, then outgrowing or quitting the game. Gamers value that collectible.

The gaming industry is expected to make $200 BILLION in revenue this year, a significant portion of which comes from in-game purchases.

Royalties on secondary market trading of gaming assets encourage gaming businesses to develop NFT-based ecosystems.

Digital assets are the start. On-chain NFTs can represent real-world assets effectively.

Real estate has a unique owner and requires ownership confirmation.

Real Estate

Tokenizing property has many benefits.

1. Can be fractionalized to increase access, liquidity

2. Can be collateralized to increase capital efficiency and access to loans backed by an on-chain asset

3. Allows investors to diversify or make bets on specific neighborhoods, towns or cities +++

I've written about this thought exercise before.

I made an animated video explaining this.

We've just explored NFTs for transferable assets. But what about non-transferrable NFTs?

SBTs are Soul-Bound Tokens. Vitalik Buterin (Ethereum co-founder) blogged about this.

NFTs are basically verifiable digital certificates.

Diplomas & Degrees

That fits Degrees & Diplomas. These shouldn't be marketable, thus they can be non-transferable SBTs.

Anyone can verify the legitimacy of on-chain credentials, degrees, abilities, and achievements.

The same goes for other awards.

For example, LinkedIn could give you a verified checkmark for your degree or skills.

Authenticity Protection

NFTs can also safeguard against counterfeiting.

Counterfeiting is the largest criminal enterprise in the world, estimated to be $2 TRILLION a year and growing.

Anti-counterfeit tech is valuable.

This is one of @ORIGYNTech's projects.

Identity

Identity theft/verification is another real-world problem NFTs can handle.

In the US, 15 million+ citizens face identity theft every year, suffering damages of over $50 billion a year.

This isn't surprising considering all you need for US identity theft is a 9-digit number handed around in emails, documents, on the phone, etc.

Identity NFTs can fix this.

• NFTs are one-of-a-kind and unforgeable.

• NFTs offer a universal standard.

• NFTs are simple to verify.

• SBTs, or non-transferrable NFTs, are tied to a particular wallet.

• In the event of wallet loss or theft, NFTs may be revoked.

This could be one of the biggest use cases for NFTs.

Imagine a global identity standard that is standardized across countries, cannot be forged or stolen, is digital, easy to verify, and protects your private details.

Since your identity is more than your government ID, you may have many NFTs.

@0xPolygon and @civickey are developing on-chain identity.

Memberships

NFTs can authenticate digital and physical memberships.

Voting

NFT IDs can verify votes.

If you remember 2020, you'll know why this is an issue.

Online voting's ease can boost turnout.

Informational property

NFTs can protect IP.

This can earn creators royalties.

NFTs have 2 important properties:

• Verifiability IP ownership is unambiguously stated and publicly verified.

• Platforms that enable authors to receive royalties on their IP can enter the market thanks to standardization.

Content Rights

Monetization without copyrighting = more opportunities for everyone.

This works well with the music.

Spotify and Apple Music pay creators very little.

Crowdfunding

Creators can crowdfund with NFTs.

NFTs can represent future royalties for investors.

This is particularly useful for fields where people who are not in the top 1% can’t make money. (Example: Professional sports players)

Mirror.xyz allows blog-based crowdfunding.

Financial NFTs

This introduces Financial NFTs (fNFTs). Unique financial contracts abound.

Examples:

• a person's collection of assets (unique portfolio)

• A loan contract that has been partially repaid with a lender

• temporal tokens (ex: veCRV)

Legal Agreements

Not just financial contracts.

NFT can represent any legal contract or document.

Messages & Emails

What about other agreements? Verbal agreements through emails and messages are likewise unique, but they're easily lost and fabricated.

Health Records

Medical records or prescriptions are another types of documentation that has to be verified but isn't.

Medical NFT examples:

• Immunization records

• Covid test outcomes

• Prescriptions

• health issues that may affect one's identity

• Observations made via health sensors

Existing systems of proof by paper / PDF have photoshop-risk.

I tried to include most use scenarios, but this is just the beginning.

NFTs have many innovative uses.

For example: @ShaanVP minted an NFT called “5 Minutes of Fame” 👇

Here are 2 Twitter threads about NFTs:

1. This piece of gold by @chriscantino

2. This conversation between @punk6529 and @RaoulGMI on @RealVision“The World According to @punk6529”

If you're wondering why NFTs are better than web2 databases for these use scenarios, see this Twitter thread I wrote:

If you liked this, please share it.

The same way Amazon killed bookstores. You just can’t see it yet.

Shultz globalized coffee. Before Starbucks, coffee sucked.

All accounts say 1970s coffee was awful.

Starbucks had three stores selling ground Indonesian coffee in the 1980s.

What a show!

A year after joining the company at 29, Shultz traveled to Italy for R&D.

He noticed the coffee shops' sense of theater and community and realized Starbucks was in the wrong business.

Integrating coffee and destination created a sense of community in the store.

Brilliant!

He told Starbucks' founders about his experience.

They disapproved.

For two years.

Shultz left and opened an Italian coffee shop chain like any good entrepreneur.

Starbucks ran into financial trouble, so the founders offered to sell to Shultz.

Shultz bought Starbucks in 1987 for $3.8 million, including six stores and a payment plan.

Starbucks is worth $100.79Billion, per Google Finance.

26,500 times Shultz's initial investment

Starbucks is releasing its own NFT Platform under Shultz and his early Vision.

This year, Starbucks Odyssey launches. The new digital experience combines a Loyalty Rewards program with NFT.

The side chain Polygon-based platform doesn't require a Crypto Wallet. Customers can earn and buy digital assets to unlock incentives and experiences.

They've removed all friction, making it more immersive and convenient than a coffee shop.

Brilliant!

NFTs are the access coupon to their digital community, but they don't highlight the technology.

They prioritize consumer experience by adding non-technical users to Web3. Their collectables are called journey stamps, not NFTs.

No mention of bundled gas fees.

Brady Brewer, Starbucks' CMO, said;

“It happens to be built on blockchain and web3 technologies, but the customer — to be honest — may very well not even know that what they’re doing is interacting with blockchain technology. It’s just the enabler,”

Rewards members will log into a web app using their loyalty program credentials to access Starbucks Odyssey. They won't know about blockchain transactions.

Join the waitlist here

Starbucks has just dealt its rivals a devastating blow.

It generates more than ten times the revenue of its closest competitor Costa Coffee.

The coffee giant is booming.

Starbucks is ahead of its competitors. No wonder.

They have an innovative, adaptable leadership team.

Starbucks' DNA challenges the narrative, especially when others reject their ideas.

I’m off for a cappuccino.

One great idea might make you rich.

Imagine having a million-dollar concept in college that made a million.

2005 precisely.

Alex Tew, 21, from Wiltshire, England, created The Million Dollar Homepage in August 2005. The idea is basic but beyond the ordinary, which is why it worked.

Alex built a 1,000,000-pixel webpage.

Each website pixel would cost $1. Since pixels are hard to discern, he sold 10x10 squares for $100.

He'd make a million if all the spots sold.

He may have thought about NFTs and the Metaverse decades ago.

MillionDollarHomepage.com launched in 2005.

Businesses and individuals could buy a website spot and add their logo, website link, and tagline. You bought an ad, but nobody visited the website.

If a few thousand people visited the website, it could drive traffic to your business's site.

Alex promised buyers the website would be up for 5 years, so it was a safe bet.

Alex's friend with a music website was the first to buy real estate on the site. Within two weeks, 4,700 pixels sold, and a tracker showed how many were sold and available.

Word-of-mouth marketing got the press's attention quickly. Everyone loves reading about new ways to make money, so it was a good news story.

By September, over 250,000 pixels had been sold, according to a BBC press release.

Alex and the website gained more media and public attention, so traffic skyrocketed. Two months after the site launched, 1,400 customers bought more than 500,000 pixels.

Businesses bought online real estate. They heard thousands visited the site, so they could get attention cheaply.

Unless you bought a few squares, I'm not sure how many people would notice your ad or click your link.

A sponge website owner emailed Alex:

“We tried Million Dollar Homepage because we were impressed at the level of ingenuity and the sheer simplicity of it. If we’re honest, we didn’t expect too much from it. Now, as a direct result, we are pitching for £18,000 GBP worth of new clients and have seen our site traffic increase over a hundred-fold. We’re even going to have to upgrade our hosting facility! It’s been exceptional.”

Web.archive.org screenshots show how the website changed.

“The idea is to create something of an internet time capsule: a homepage that is unique and permanent. Everything on the internet keeps changing so fast, it will be nice to have something that stays solid and permanent for many years. You can be a part of that!” Alex Tew, 2005

The last 1,000 pixels were sold on January 1, 2006.

By then, the homepage had hundreds of thousands of monthly visitors. Alex put the last space on eBay due to high demand.

MillionDollarWeightLoss.com won the last pixels for $38,100, bringing revenue to $1,037,100 in 4 months.

Many have tried to replicate this website's success. They've all failed.

This idea only worked because no one had seen this website before.

This winner won't be repeated, but it should inspire you to try something new and creative.

Still popular, you could buy one of the linked domains. You can't buy pixels, but you can buy an expired domain.

One link I clicked costs $59,888.

You'd own a piece of internet history if you spent that much on a domain.

Someone bought stablesgallery.co.uk after the domain expired and restored it.

Many of the linked websites have expired or been redirected, but some still link to the original. I couldn't find sponge's website. Can you?

This is a great example of how a simple creative idea can go viral.

Comment on this amazing success story.

Steve Jobs' initial mission at Apple in 1997 was to destroy. He killed the Newton PDA and Macintosh clones. Apple stopped trying to please everyone under Jobs.

Afterward, there were few highly targeted moves. First, the pink iMac. Modest success. The iPod, iPhone, and iPad made Apple the world's most valuable firm. Each maneuver changed the company's center of gravity and won.

That's the idea behind Schwerpunkt, a German military term meaning "focus." Jobs didn't need to win everywhere, just where it mattered, so he focused Apple's resources on a few key goods. Finding your Schwerpunkt is more important than charts and analysis for excellent strategy.

Comparison of Relative Strength and Relative Weakness

The iPod, Apple's first major hit after Jobs' return, didn't damage Microsoft and the PC, but instead focused Apple's emphasis on a fledgling, fragmented market that generated "sucky" products. Apple couldn't have taken on the computer titans at this stage, yet it beat them.

The move into music players used Apple's particular capabilities, especially its ability to build simple, easy-to-use interfaces. Jobs' charisma and stature, along his understanding of intellectual property rights from Pixar, helped him build up iTunes store, which was a quagmire at the time.

In Good Strategy | Bad Strategy, management researcher Richard Rumelt argues that good strategy uses relative strength to counter relative weakness. To discover your main point, determine your abilities and where to effectively use them.

Steve Jobs did that at Apple. Microsoft and Dell, who controlled the computer sector at the time, couldn't enter the music player business. Both sought to produce iPod competitors but failed. Apple's iPod was nobody else's focus.

Finding The Center of Attention

In a military engagement, leaders decide where to focus their efforts by assessing commanders intent, the situation on the ground, the topography, and the enemy's posture on that terrain. Officers spend their careers learning about schwerpunkt.

Business executives must assess internal strengths including personnel, technology, and information, market context, competitive environment, and external partner ecosystems. Steve Jobs was a master at analyzing forces when he returned to Apple.

He believed Apple could integrate technology and design for the iPod and that the digital music player industry sucked. By analyzing competitors' products, he was convinced he could produce a smash by putting 1000 tunes in my pocket.

The only difficulty was there wasn't the necessary technology. External ecosystems were needed. On a trip to Japan to meet with suppliers, a Toshiba engineer claimed the company had produced a tiny memory drive approximately the size of a silver dollar.

Jobs knew the memory drive was his focus. He wrote a $10 million cheque and acquired exclusive technical rights. For a time, none of his competitors would be able to recreate his iPod with the 1000 songs in my pocket.

How to Enter the OODA Loop

John Boyd invented the OODA loop as a pilot to better his own decision-making. First OBSERVE your surroundings, then ORIENT that information using previous knowledge and experiences. Then you DECIDE and ACT, which changes the circumstance you must observe, orient, decide, and act on.

Steve Jobs used the OODA loop to decide to give Toshiba $10 million for a technology it had no use for. He compared the new information with earlier observations about the digital music market.

Then something much more interesting happened. The iPod was an instant hit, changing competition. Other computer businesses that competed in laptops, desktops, and servers created digital music players. Microsoft's Zune came out in 2006, Dell's Digital Jukebox in 2004. Both flopped.

By then, Apple was poised to unveil the iPhone, which would cause its competitors to Observe, Orient, Decide, and Act. Boyd named this OODA Loop infiltration. They couldn't gain the initiative by constantly reacting to Apple.

Microsoft and Dell were titans back then, but it's hard to recall. Apple went from near bankruptcy to crushing its competition via Schwerpunkt.

Rather than a destination, it is a journey

Trying to win everywhere is a strategic blunder. Win significant fights, not trivial skirmishes. Identifying a focal point to direct resources and efforts is the essence of Schwerpunkt.

When Steve Jobs returned to Apple, PC firms were competing, but he focused on digital music players, and the iPod made Apple a player. He launched the iPhone when his competitors were still reacting. When Steve Jobs said, "One more thing," at the end of a product presentation, he had a new focus.

Schwerpunkt isn't static; it's dynamic. Jobs' ability to observe, refocus, and modify the competitive backdrop allowed Apple to innovate consistently. His strategy was tailored to Apple's capabilities, customers, and ecosystem. Microsoft or Dell, better suited for the enterprise sector, couldn't succeed with a comparable approach.

There is no optimal strategy, only ones suited to a given environment, when relative strength might be used against relative weakness. Discovering the center of gravity where you can break through is more of a journey than a destination; it will become evident after you reach.