Up to this point, NFTs have gotten a bad rap. When most people hear the term, they think about Bored Apes or childish video games. Why would someone spend hundreds of thousands of dollars on a JPEG that anyone can download themselves? What value does that give?
It’s easy to criticize a technology in its early stages. Before Uber and Instagram, the app store seemingly only contained apps to produce trombone sounds and other silly gimmicks. In a similar way, NFTs have only been applied to a small, single field so far — digital art. While even this application is interesting to anyone knowledgeable about art markets, NFTs will quickly move past JPEGs and onto more significant areas.
In this final part of this mini-series, I’ll dive into one application area using an example of an NFT project called CryptoSwarm.ai. Full disclaimer, I am on the team behind this project, but it’s an excellent case study nonetheless.
What is CryptoSwarm?
CryptoSwarm was started by Unanimous AI, a company that built Swarm AI, a collective intelligence software that has been lab and market tested for nearly a decade. Swarm AI allows users to come together in real-time ‘swarms’ and converge on optimal decisions through collective intelligence and AI-supported feedback loops. It’s based on the same science behind why bees swarm and fish school. In the past, it has allowed traders to boost their ROI from 0.7% to 13.3% and Stanford medical doctors to improve diagnoses by 33% compared to their individual opinions.
This forecasting power also applies to crypto. We bring together groups of cryptocurrency traders using Swarm AI to produce intelligence reports for our community. Generating intelligence through swarming is a much more natural way to gauge market sentiment driving crypto prices since they’re defined entirely by what participants feel and think.
Instead of using cold, technical analytical tools, CryptoSwarm lets human experts combine reasoning and emotion in real-time swarm sessions that are thoroughly analyzed in our reports. This flexible system produces intel that’s relevant regardless of the state of the market: upturn, downturn, sideways.
Here’s the catch. Instead of relying on traditional payment rails and in-house databases to manage a standard subscription model, we use NFTs as a ticket to unlocking these intelligence reports.
That means holders gain real utility from day one — no ugly apes, no hype marketing. This is a trend that’s been accelerating as more companies integrate NFTs into their models, providing their already valuable offerings in novel go-to-market strategies.
NFT Subscription Models
There are a few advantages to using NFTs as subscription passes. One is that buyers can resell their pass once they no longer need the service, potentially even at a profit if the NFT appreciates. Payments between business and customer also happen much more naturally across borders and without strict requirements that people from emerging markets may not be able to meet, expanding the addressable audience base and streamlining the customer experience. Finally, it’s also great for access management, since you can easily verify if someone holds an NFT in their wallet or not.
Since our target audience is crypto traders, it makes sense to rely on a crypto-adjacent mechanism, like NFTs, which our audience is already familiar with. Unlike a standard subscription model, choosing to issue NFTs right now also comes with a set of expectations and benefits. For example, almost all NFT projects have Discords, and place value on building a community of individuals and being fully transparent with that community — as opposed to building a spreadsheet with a list of phone numbers and emails of customers.
CryptoSwarm and Web3
Well-built communities can introduce a network effect and provide value in addition to your product or service, propel Web3 projects forward through word-of-mouth, and build trust between business and customer.
The Web3 ecosystem gives many options to expand into. It would be possible for CryptoSwarm.ai to allocate a DAO-like fund based on the swarm predictions, where contributors are awarded proportionally to how many NFTs they hold. We can also issue more NFTs if the first mint is successful and demand increases, maintaining tight control of what is nowadays called ‘tokenomics.’
Final Thoughts
Even if you don’t want to integrate NFTs, Web3, or crypto into your business right away, at least don’t shrug it off for another decade. As mentioned in the last part, it’s a classic case of the Innovator’s Dilemma, where the emerging technology has less to offer than established solutions but with a growth rate that will leave the established things dead in the water in a few years, creating markets rather than winning them over.
It’s probably a good idea to get familiarized now. Getting this far in this three-part series is an excellent start. If you’re a trader or want a great introduction to this world, head to CryptoSwarm’s website or reach out to me directly if you have any questions about NFTs.
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