At 4K we are building the Physical-Digital™ bridge, a decentralized protocol that enables anyone to bring physical assets on-chain as physically-backed NFTs.
To understand this innovation, we must understand the importance of bringing physical-assets on chain in the first place.
The physical world is fundamentally uncertain, especially with trust-based transacting. Say you're buying a Rolex on the secondary market from a reseller — how are you sure the watch is authentic? How can you accurately trace provenance without bypassing the reseller who acts as a gatekeeper?
This is one of the problems solved by an NFT. By bringing a physical asset on-chain, you're creating a transparent ledger of your asset's history. You're able to track every previous owner, maintenance and repair reports, condition grades, and any supplemental evidence of authenticity. This can apply to all NFTs backed by physical-assets, including sneakers, handbags, tradings cards, and high-end collectibles.
A physically backed NFT allows you to sell your asset without it ever having to be re-authenticated or re-graded. The NFT grants full transparency for the authenticity of your physical asset.
A major issue with current Web 2.0 marketplaces are the excessive fees on seller transactions.
With an NFT, you're able to accept crypto as a payment and sell your asset for a premium. NFTs allow you to seamlessly trade on a variety of Web 3.0 platforms that have significantly lower fees than traditional Web 2.0 platforms (eBay, Stock X). For instance, if you wanted to sell your NFT on our 4K marketplace (4K.com), you would only pay a 1% transaction fee.
Also, with traditional Web 2.0 marketplaces, you're at the mercy of out-dated protocols. Transactions and settlement times are slower, difficult to scale up due to logistics, and you have limited access to international markets or goods.
With an NFT, transaction and settlement times are fast, efficient, and scalable, opening the world to easier global commerce.
An NFT backed by your physical asset opens the door to various financial opportunities through Decentralized Finance (DeFi).
Anyone can use physically-backed NFTs as collateral in a loan, a means of fractionalization, or even as the basis of a stablecoin.
People will no longer need to be in physical proximity of a physical asset in order to use it. Idle physical assets will be brought into the Metaverse, become the basis for membership into social clubs, and enable other use cases we can't yet imagine.
As you can see, there are many benefits to physically-backed NFTs. 4K is dedicated to acting as the premier coordination layer between the physical and digital worlds, unlocking the newfound, limitless possibilities of physical assets on the blockchain.
And be sure to check out our latest marketplace listings here!