NFT fever high among Indian celebrities, consumers still catching up

The overall value of the NFT market is expected to rise to $231 billion by 2030, says report

Sachin Tendulkar is set to get a new stats page, and this one will not be on ESPN CrickInfo or the ICC website. Nor will the stats sum up his batting milestones, or his career highlights. Instead, the Little Master's fans will get interesting new facts such as "tier", "pack", "lowest and highest ask," etc.

Tendulkar, on October 20, became the latest among a long list of Indian celebrities flocking to the Non-Fungible Token (NFT) market. He made a strategic investment in the sports-NFT platform Rario, allowing fans worldwide to own his digital collectibles. "Tier" and "asks" are the classifications Rario has for its digital player cards.

NFTs are unique cryptographic entities recorded on blockchains. Whereas cryptocurrencies are considered fungible similar to fiat currencies — one US dollar being exchangeable for any other dollar — the non-fungible tokens cannot be exchanged for another. 

Tendulkar isn't the only cricketing icon to invest in NFTs. The development comes within days of Virat Kohli and Mahendra Singh Dhoni's entry into another cricket NFT platform, FanCraze. On this, fans can bid for and buy NFTs of specific moments in the player's career, such as the last six that Dhoni hit in his ODI career or Kohli's six against Pakistan in the previous ODI World Cup. Last year, Dinesh Karthik, Rohit Sharma and Yuvraj Singh also entered various NFT marketplaces.

Rizwan Ahmed (name changed), a 34-year-old IT professional from Kerala, nearly doubled the $650 invested in three days since the T20 World Cup 2022 began. He has bought 12 moments and cards from Rario and FanCraze, which he intends to trade as the tournament progresses. "This is a trading-cards game with serious financial investment, the emotional quotient seems to be the same. I focus primarily on sports NFTs, and the trade invariably picks up during marquee gaming events, as they did for our card trades back in school," Ahmed says. 

However, Ganesh Vasudevan, Research Director, IDC Financial Insights, believes that Ahmed's example does not capture the general mood of Indian customers on NFT. "With the average costs of minting and sharing NFTs anywhere between $200 and $350, the buying power and initiative for getting onto the NFT marketplace is still limited to a small section of young working professionals in India," he said. However, Vasudevan added that many celebrities are getting into the market.

In the past year and a half, the NFT market has drawn big names from India's entertainment industries. In 2021, singer Kumar Sanu launched an NFT series through FlamingoNFT, which had exclusive videos, unreleased songs, clips from his first audition, autographed digital memorabilia and collectibles, and more.

Amitabh Bachchan also released a series of NFTs on BeyondLife.club, which included autographed copies of vintage movie posters. Michelin-star Indian chef and author Vikas Khanna, also teamed up with NFT marketplace Akshaya.io to launch his new limited-edition book Sacred Foods of India in NFT formats. Fashion designer Manish Malhotra launched a fashion-themed NFT collection on the WazirX marketplace in October last year, which included five digital designs sketched by the artiste.

The Web 3-based investment avenue is also a hit among global celebrities. The most famous recent instance is the NFT track "From the D 2 the LBC", performed by American rap artistes Snoop Dogg and Eminem. Production and distribution majors like MGM and Lionsgate also offer NFT tickets, exclusive previews, and other collectibles of their film and TV franchises. 

According to a report by the consulting and global research firm VMR (Verified Market Research), the overall value of the NFT market is expected to rise to $231 billion by 2030. The global NFT market was set to grow by a CAGR of 33.7 per cent in the next eight years, the report added.

While India's share in the global NFT market is negligible, the high traction for NFTs has contributed to the rapid rise of exclusive Web3 members-only fan clubs like Eros Investments, Xfinite and Calvin Cheng-backed XelebX, which plans to provide a platform of interaction for over 200 million existing fans of global influencers and celebrities associated with Eros' ecosystem and its group companies through their NFTs and Fan Tokens.

XelebX will issue membership passes in the form of NFTs, which fans can then buy to access live-streaming platform interactions with their favourite celebs and influencers. Each pass is linked to the specific influencer, so as the influencer gets more popular the value of the pass appreciates. These passes can be sold and bought.

Surya Narayan Saha, research manager at IDC, points out that the NFTs, such as the ones offered by XelebX, are prudent investment opportunities for artistes and creators. Since they cannot be exchanged or traded equivalently like other cryptographic assets, NFTs can not only prevent internet protocol (IP)-based thefts in the entertainment sector, but also locks in, preserves, and even appreciates the value of the artwork or creation, even after the artiste has stopped producing newer artworks.    

However, both Saha and Vasudevan push for caution in the wake of the craze that NFTs have generated. "Buyers are not always privy to the full implications of what buying and possessing such NFTs mean, or how future regulations related to the copyright implications of such NFTs can alter their value," they say.

In the last financial quarter, the global headwinds in cryptocurrency trade — the total number of active NFT buyers and sellers dipping below 750,000 in Q2 — were magnified for the domestic NFT markets thanks to the 30 per cent levy on "virtual digital assets" that Finance Minister Nirmala Sitharaman introduced in Budget 2022, Vasudevan says.

Commenting on the need for more prudent regulation, Saha emphasised that apex regulatory bodies like the Securities and Exchanges Board of India (Sebi) should look beyond taxation and introduce a proper copyright framework to address the NFT minting and selling process.

"While the entertainment industry naturally lent itself to NFTs since the content, in general, is digital, the NFTs at the intersection of physical and digital environments like physical artwork or any other physical assets remains challenging and complicated. Therefore, it would be prudent for the regulators to introduce an overarching guideline that understands and addresses both these aspects of the NFT," Vasudevan says.

How to Mint NFTs

1. Create a Unique Asset: This can be an in-game weapon, digital trading cards, songs, videos, books, animations, and digital artworks. Digital art lives as data on a blockchain of your choice.
 

2. Buy Tokens: Buy crypto used on the blockchain you've chosen. The blockchain also influences the wallet services and marketplace you choose. For that, you need to hit up a crypto exchange.
 

3. Deposit Tokens into a Non-Custodial Wallet: A crypto wallet is an application that lets users interact and connect with the crypto network and their accounts. A non-custodial wallet gives you full control over your funds without third-party involvement.
 

4. Choose and Add Assets to an NFT Marketplace: Next, choose an NFT marketplace such as OpenSea, Mintable, Holaplex, Objkt, etc. Some of these charge users minting fees, costs for starting your account, listing an NFT, and transacting on the platform.
 

5. Add Your Assets to the NFT Collection: Choose the artwork you want to mint, fill in the details like collection name, description, etc., and finish the process by adding the asset to your collection. You're all set. Time to list and sell.