This week, Kering SA’s Gucci and LVMH’s Tiffany & Co. joined the ranks of high-end brands venturing farther into the crypto sphere by announcing NFT-related projects. Gucci is adding another cryptocurrency to the list of currencies it accepts as payment, while Tiffany will employ NFTs as a digital passport to create personalized physical jewelry for crypto enthusiasts.
These projects were defined by the firms as “the future” and “yet another step” in their research of web3, a term used to refer to next-generation internet capabilities. However, the market conditions for these launches appear to be less than optimal.
The NFT market has seen a drop in demand in recent months, with resale value performing poorly alongside larger industry instability that has knocked nearly $2 trillion off the total value of the crypto sector.
Nonetheless, industry leaders stated that many large consumer companies continue to consider NFTs and web3 technologies as viable methods to connect with customers.
“Brands have this opportunity to have a new kind of relationship with their customers,” said Ian Rogers, former LVMH chief digital officer and now chief experience officer at crypto hardware firm Ledger. “What you are going to see over the next few years is a lot of experimentation as people figure that out.”
Ledger has created an NFT marketplace to be the hub for drops from major brands and artists. It has also previously cooperated with LVMH’s Fendi, designing Fendi-branded tech accessories to hold Ledger’s USB stick-sized wallets.
Partnerships benefit both parties, with pricing data demonstrating that support by established companies may also benefit crypto ventures.
Following Tiffany’s July 31 statement that it would provide “NFTiff” collectible passes that CryptoPunk NFT owners could redeem for a bespoke necklace, the digital artwork collection’s floor price increased by more than 9% to 74.69 ether, or nearly $123,000, according to NFTPriceFloor statistics.
And, following Gucci’s tweet on Tuesday about taking ApeCoin as payment at some of its boutique stores in the United States, the token recovered from a 4 percent drop. ApeCoin issuer Yuga Labs’ Bored Ape Yacht Club collection of NFTs also surged rising 5.2 percent to 84.19 Ether.
In comparison, the broader JPG NFT Index, which tracks the prices of a small number of high-profile NFT projects, fell 5.4 percent.
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