Jay-Z leads a $19 million funding round for Bitski, a new NFT platform that wants to take over.
Bitski says it wants to be the Shopify of NFTs sold online, dominating the market. It aims to enable brands to create and sell non-fungible tokens through its platform. Content creators are encouraged to jump in with very little blockchain experience required. Also on board for this funding round is A16z.
“We have a number of investments focusing on NFTs and the metaverse – from Dapper Labs to OpenSea. It only stands to reason we invest in the infrastructure that makes NFTs accessible,” writes Sriram Krishnan of the deal.
Other investors in this funding round for Bitski include Serena Williams, MrBeat’s Night Media, and Ari Emanuel, Endeavor CEO. A seed funding round in November 2019 for Bitski was led by Galaxy Digital, Winklevoss Capital, and Coinbase Ventures for $1.81 million.
The non-fungible token craze took off at the beginning of 2021, but the bubble may soon burst. Investment in the sector has slowed down dramatically since February, especially in selling NFT artwork. The average price for an NFT sold in April was about $1,256 per piece – down from $4,000 per piece in February 2021.
NFTs are essentially a proof of concept that digital goods have value in the real world. That’s because they’re tied to the metaverse, a sci-fi idea that people will value an imagined connected world just as much as the real world. To some degree, the internet is a bit of a metaverse itself.
The NFT craze may be dying down, but it’s not going away. It has boosted the value of ethereum, the cryptocurrency powering NFTs, to new heights. While artists who capitalized on the early craze were able to score millions for their digital artwork, that may not always be the case in the future.
NFTs also need to present some value beyond prestige to their buyer. Kings of Leon has experimented with this by selling ‘golden ticket’ NFTs. These ticket NFTs grant the holder a free backstage experience at one Kings of Leon concert per tour. The rights to the VIP experience are transferrable, so if the original owner sells it – a new person can claim that free backstage pass.
The idea behind NFTs is that the Kings of Leon would earn residual income each time the NFT is sold. It’s a new way to support artists that goes beyond music streaming royalties, which are increasingly untenable.