Companies together with Disney, online game writer Electronic Arts and Robinhood Markets are anticipated to profit from non-fungible tokens (NFTs), in accordance to a brand new report from Citi.
- “The advent of NFTs promises significant disruption to any/all sectors with exposure to IP (intellectual property), licensing and merchandise related revenues,” Citi analyst Thomas Singlehurst wrote in a report entitled “Disruptive Innovations,” noting that “the key point is that its decentralized and democratized model allows content owners to disintermediate traditional gatekeepers both in terms of distribution and monetization.”
- Citi stated that video video games and music as industries which are more than likely to see optimistic modifications from the inflow of NFTs, that are blockchain-based tokens that show possession of a chunk of digital content material. Trading in NFTs climbed to $10.7 billion within the third quarter, a rise of greater than 700% from the earlier quarter, in accordance to a report by blockchain analytics agency DappRadar.
- Other U.S. firms anticipated to be helped by NFTs embrace online game writer Activision, FormulaOne Group, Discovery Inc., ViacomCBS and World Wrestling Entertainment.
- Companies in Europe anticipated to profit from NFTs embrace such entities as online game publishers Embracer Group, Frontier Developments, Team17 Group and Ubisoft and advert companies Publicis Groupe and WPP.
- Citi stated that these firms both concentrate on promoting content material or branded items, are concerned within the creation or buying and selling of NFTs or are service firms that assist content material creators navigate the NFT market.
- Areas and firms which are possible to be damage by NFTs embrace online game retailers with bodily shops, conventional report labels and music publishers, conventional video and music streaming platforms and “walled garden” on-line ecosystems. All of these are intermediaries that could possibly be bypassed if content material creators had a extra direct relationship with their prospects, in accordance to the report.
- “To be clear, in each case the rise of NFTs is unlikely to be terminal for any of these players, but to the extent that there is pressure on take rates as content ecosystems become more decentralized/democratized, it potentially heralds (relative) pressure on revenues and returns,” Singlehurst wrote.
- While Disney doesn’t seem to have entered the NFT market but, competitor Fox Entertainment introduced in June it was placing $100 million behind its NFT-driven blockchain experiment.