In recent years, the emergence of Non-Fungible Tokens (NFTs) has disrupted the digital asset space and brought about significant changes in the ecosystem. With their decentralized and easily tradable nature, NFTs have opened up new possibilities and value discovery in areas such as digital art, music, and gaming.

However, if we broaden our perspective, we can realize that our world is actually composed of both virtual and physical components. While NFTs have proven their value in the virtual realm, what possibilities would arise if we apply NFTs to the real world?

The metaverse may be the future, but offline life will always be present

In the past few years, the metaverse has garnered widespread attention, incorporating various concepts such as artificial intelligence and virtual reality. It represents the potential future form of the digital age, where information technology breaks through material limitations, expands creativity, and reconstructs existing relationships.

The development towards a virtual world seems to have become an irreversible trend.

However, this does not encompass the entirety of the picture. After all, we still live in the material reality where many of our familiar experiences are hard to replace (or shouldn’t be replaced). Moreover, the offline world has already fostered numerous values. Therefore, a complete future world should be a harmonious fusion of the virtual and the physical domains, complementing and enriching each other.

Online and offline worlds each have their own unique characteristics, and it is important to emphasize integration rather than segregation between the two

Offline interactions have several characteristics that set them apart. Here are three points to illustrate:

1. Value validation: In the past, NFTs, especially in the form of profile picture (PFP) projects, were often seen as speculative trends. One reason for this perception is that the value of virtual items is subject to individual interpretation and imagination, leading to variations in value assessment. In contrast, physical items are often valued based on their tangible presence, making it easier to establish consensus or articulate their historical significance.

2. Clear boundaries: Interactions in physical environments have clearly defined boundaries. With proper control over the environment, there are fewer unexpected or unpredictable consequences. For example, the concept of a buyer paying and receiving goods is easily achieved in offline transactions, while online transactions require more technology and rules to facilitate the same process. Offline interactions are simpler in this regard.

3. Interweaving of information: The experience of the physical world can incorporate multiple senses and various dimensions of value, creating a richer context for an action or asset. For instance, the impact of a physical painting may stem from its visual aesthetics, the physical space it occupies, and the historical context it represents. In the online realm, integrating these elements to recreate the same experience requires comprehensive integration.

By integrating these characteristics with NFTs, we can unlock greater innovation and possibilities in bridging the online and offline realms.

When NFTs extend to the offline world…

So, what are some possible applications to imagine when NFTs extend to the offline world?

1. Extending the value of virtual assets into the physical realm By bridging the value of NFTs from the digital world to the physical world, new opportunities for interaction and value creation can arise. For example, if a player card holds value both as a physical collectible and as an NFT, integrating the online and offline value can establish a higher level of consensus.

2. Enhancing the trustworthiness of physical items Physical scarce items often face the risk of counterfeiting, and their value often relies on their scarcity. Without robust means of ensuring their uniqueness, accumulating value becomes challenging (or comes at a high cost). Blockchain technology can effectively address this issue by providing a secure and immutable record of authenticity.

3. Improving the liquidity of physical items The physical world, based on atoms rather than bits, inherently has lower liquidity. Traditionally, financial mechanisms like securities have been used to increase liquidity. However, by introducing blockchain technology, a unified backend settlement mechanism can greatly enhance liquidity. For example, Tangible uses a similar approach to reduce transaction friction and enable greater value discovery.

4. Initiating interactive processes starting from the physical realm User interfaces, such as wallets, have been a significant topic of improvement in the blockchain space over the past years. After all, even with excellent technology, widespread adoption can be challenging if the barriers to entry are high. Through physical interactions, users can be subtly educated. For instance, by materializing cryptocurrencies into physical forms like paper money or checks, users have the opportunity to experience and understand them before fully grasping the concepts behind them.

Interconnectivity is indeed crucial, but it should not be limited to just cold wallets

In the aforementioned context, an important issue is: What should be the interface for integrating NFTs with the physical world?

Simply put, in the decentralized virtual world, we ensure the uniqueness of assets through a consensus ledger. However, when this uniqueness needs to transition into the real world, an effective interface is required to establish the connection.

In the past, hardware devices associated with blockchain were primarily mining rigs and cold wallets.

However, mining rigs are not directly relevant to the integration of the virtual and physical realms, and cold wallets have their limitations in fulfilling such a role.

Compared to representing the “item” itself, cold wallets focus more on the perspective of the “user,” which makes it more challenging for cold wallets to physically integrate with items.

In reality, the interface integration with physical items is more likely to be a domain of Internet of Things (IoT) product design. One of the most well-known solutions in the market is Azuki’s BEAN chip. When it comes to custom manufacturing and consulting services, RealiTag could be a good choice. It has already been applied in various fields such as artwork and anti-counterfeiting products.

RealiTag demo video : https://www.youtube.com/watch?v=wZCA0JrYG

By integrating the virtual and physical realms, we can create a closed loop for applications

The information that NFTs can carry goes beyond simple assets or creations; it has the potential to become the starting point for new production relationships. It becomes crucial to ensure that these explorations can be effectively implemented in our daily lives through the integration of the virtual and physical realms.

With ongoing technological development and innovation, we can expect more creative applications that seamlessly extend the value of NFTs into the real world, further enriching our lives and experiences.

RealiTag：Bring digital to your reality
https://www.realitag.app/