As our "Punks for the People" campaign to free a CryptoPunk fr om Ethereum begins, read a deep dive into the unique power of refungible tokens and how they reimagine NFTs and the blockchain
For generations, value has been defined by fiat currency, fungible assets, and an unwillingness to think outside the box when exploring the opportunities of collective ownership. But no longer does our past need to define our present, and especially our future. As NFTs have reimagined ownership, investing, and access to wealth, a new technology being pioneered by Unique Network, refungiblitity (or RFT) will breathe new life into a world that’s ready for more.
Aninnovative spin onfractionalization for the Polkadot ecosystem, RFT powers our “Punks for the People” campaign, wh ere weare demonstrating the power ofRFT technology through the shattering ofCryptoPunk #3042. Just like wewill break upthis classic punk into tens ofthousands ofpieces togive toour community, RFT will break barriers inhow wedefine value, community ownership, and the concept ofcollateral. Let’s find out how—and why.
Fr om publicly traded companies toancient frameworks like hereditary succession, fractional ownership has existed indifferent ways throughout history. AtUnique Network, wh ere our mission istopromote advanced features and next-generation use cases for blockchain and NFTs, wesee fractional ownership and our own RFT technology asasolution fit toenable NFTs for dynamic trade and commerce. RFT technology also speaks toamindset ofopenness and accessibility, themes that over time have been oft-abandoned fr om the early days when blockchain thrived onopen-source technology and apunk mindset. Asearly NFTs like Cryptopunks sell for millions ofdollars, newer blue-chip collections like Bored Ape Yacht Club have come torepresent anelitist “boys club,” shared ownership, and the liberation ofNFTs across multiple blockchains has become more ofararity. Weare dedicated tochanging that.
Why should NFTs (and their utility) beconfined toasingle ownership model orblockchain, for that matter? Blockchain was built toflex the power ofopen-source technology, wh ere innovation isshared, not gatekept. NFTs have caught the world’s attention because they open doors for artists, communities, and novel opportunities for profit. Wecan’t let innovation live inavacuum orbecontrolled bysingle, powerful entities. Both re-fungibility and cross-chain NFTs give power back tothe people, asthe blockchain was always meant todo. Let’s look atafew use cases which demonstrate the power ofre-fungibility.
NFT Fractionalization: Our Punks for the People campaign demonstrates how re-fungibility allows for multiple custom ownership models, like timeshares and co-ownership. RFT tokens can beminted and then transferred tomultiple owners, allowing individual RFT tokens tobepurchased byafund and shared asadividend amongst owners. Split pieces can then beused asfungible tokens and traded onexchanges for price discovery.
Fractional ownership inthe Metaverse: Ifusers hold enough plots ofland, they can combine them tocreate asingle estate. One example ofthat is“The Secrets ofSatoshi’s Tea Garden”— anestate onDecentraland made upof64separate plots ofland. Itsold for 1.3 million MANA in2019 (about $80,000) because ofits size and location. The “land” iscompletely surrounded bydigital roads, making itconvenient toaccess. Like NFTs and assets collectively owned byDAO, fractional ownership inthe Metaverse disrupts typical real estate models, allowing groups ofpeople tocollectively invest inparcels and gain control ofonce untouchable value. Decentralized communities attheir finest.
Real Estate: Last year in CoinDesk, Unique’s Irina Karagyaur penned anop-ed onthe future ofreal estate inthe Metaverse, with aspecific nod tothe potential offractionalization, especially inamulti-chain environment. “Inthis multi-chain future, wewill see vast opportunities and diverse use cases made possible byalternative chains like Solana, Tezos, Polkadot, Kusama, Cardano, and many others,” she said. "These chains bring answers for scalability, network congestion and the ability totruly fractionalize ownership, allowing non-fungible tokens (NFTs) tobecome usable and transferable inthe Metaverse— breaking out ofthe confines oftraditional digital collectibles— perhaps into the real world.
Domain names: Shared ownership ofaURL? Anarticle in CodyTechs broke down this curious opportunity, noting that while the trade ofweb domains appears simple atthe surface, when you pool funds fr om alarger community, the chance for buying out-of-reach domains becomes areality, leading tothe opportunity for much higher returns and equity.
DAOs: Popular DAOs like PleasrDAO and the short-lived yet well publicized ConstitutionDAO have demonstrated the potential ofwhat large communities can dowhen they pool funds and own expensive assets collectively. Weare seeing agrowing trend ofinvestors utilizing this community-focused web3 framework tobreak down barriers and increase access to things that were previously only available tothe wealthy and powerful.
Even with the immense potential ofre-fungibility, it’s important tounderstand the risks involved and the need for careful consideration, from legal nuances around custody tothe importance ofknowledge sharing. Wealso must beopen about the array oftechnical challenges that will take years ofhard work and education tosolve and improve. Regardless, webelieve that RFT and the promotion ofcross-chain NFTs continue the work and dedication ofblockchain’s early builders who were devoted toexperimentation, accessibility, and open-source innovation. Aswecontinue tomove forward with our “Punks for the People” campaign, wh ere wewill free Monique (aka Cryptopunk #3042) from the lonely captivity ofasingle blockchain (Ethereum), wewill stay true tothe ethos ofre-fungibility and how itbrings community ideals and ownership back tocrypto. Wehope you will joinus insharing apiece of the future.