#62 | BMW Switches To NFT Based Loyalty Program??

Estimated Read Time: 9 minutes

Hey friends,

Welcome back to another edition of Morning NFTea! Apart from more innovative stories from goliath brands like BMW and LG, we're adding a new section called 'The Blockchain Brew Up' to accompany our usual coverage and 'What's The NFTea?'. It's going to be a jam-packed issue, let's jump into it!

The Blockchain Brew Up ☕

Welcome to a brand-new section of Morning NFTea! Here, we'll be including a blockchain brew-up that slightly takes the focus off NFTs to keep you updated with more general crypto and blockchain news trends. While NFTs are our main focus, crypto forms an increasingly relevant context to understand the ever-changing Web3 and NFT space.

Starting off, we're taking a look at the Polygon blockchain which has recently been experiencing exploding volumes. The Ethereum Layer-2 scalability solution has highlighted a need and a shift for cost-effective gas fees for crypto transactions, that's because Polygon targets the scalability issues of Ethereum for a faster and cheaper experience while leveraging the base security and existing infrastructure. These benefits have made it a go-to chain for many gaming platforms and everyday loyalty programs, with partnerships with some of the biggest brands in the world as listed in the picture above, like our coverage of Starbucks loyalty program and Reddit's NFT avatars amongst others.

Since Polygon's MATIC token low of $0.35 in June 2022, Polygon is now trading around $0.80 with December marking a new NFT OpenSea volume record of 1.3 million NFT sales reaching $15.3 million despite our current bear market, and an overall yearly increase in total volume with 2022 reaching $324 million in NFT sales, surpassing its 2021 record which occurred during the peak of the NFT and crypto bull market. This recent record uptake of the Polygon has no doubt leveraged competitor Solana's blockchain fall from grace following the collapse of FTX (and a $3M developer grant from the Polygon chain has encouraged Solana-based collection y00ts to migrate over in Q1 2023).

As our bear market continues into 2023 and everything seems to be in the red, Polygon has proven that the real-world use cases of a cost-effective blockchain put the technology far and above any speculative investing, and exemplifies the prospective future that we have for NFTs and Web3.

Headlines Around the Web3 Space

BMW Embracing NFTs In New Loyalty Program

When it comes to the most recognisable brands in the world, it's hard to go past car manufacturers and their immense influence on our current society. Recently, it's also been hard to go a news cycle without a car manufacturer utilizing NFTs in some way or another. To recap this trend, in the last newsletter we had KIA funding 22,000 pet homes through NFTs, before that was Rolls-Royce embedding NFTs in their glovebox, directly previous was Mercedes' NFT applications and preceding that was Aston-Martin's drivable NFT cars and Porsche's lifestyle NFT cars. So whether BMW has felt the pressure to innovate in Web3 or just wants to level up its existing infrastructure, they have been next to join the convoy with an NFT-powered loyalty program.

The century-old German automaker will first be rolling out the BMW NFTs to Thai owners which will be accessible through a new Web3 rewards app. In partnership with blockchain technology company Coinweb, the system is built on the blockchain arm of the world's largest crypto exchange Binance to have its roots set on the BNB chain.

In a continued effort to integrate Web3 into BMW’s products, this new loyalty program will create an ecosystem where customers can gain loyalty points used to redeem rewards through various products and services from the brand. If this sounds familiar, it's similar to how Starbucks rolled out an upgraded loyalty program through NFTs.

This quote from Toby is a great summary of why traditional brands like BMW are looking into the benefits of NFTs and the blockchain; they are not necessarily just a new revenue stream, but an evolution of the technological infrastructure available, and it's pretty cool that we get to be along for the ride.

LG Metaverse Partnership Will See Interoperable NFTs

LG Electronics is one of the largest electronic companies in the world occupying around 16% of the TV market amongst other products and services. It wasn't too long ago we covered LG’s hiring of NFT & Web3 focused CTOs (Chief Technology Officer) and their Art Lab marketplace letting you display NFTs on your TV. But this new announcement takes LG to another level with a Metaverse partnership between PIXELYNX and Oorbit.

To set the scene, PIXELYNX is a Web3 music ecosystem backed by Animoca Brands, creator of the leading Metaverse platform The Sandbox, and Oorbit a “3D internet” technology platform building Web3 virtual worlds. Together, LG is utilising the musical expertise of PIXELYNX and the infrastructure of Oorbit to create high-quality virtual events and concerts available to LG customers internationally. Although it is still in very early stages, Orbit co-founder Pooya Koosha says “Our proprietary technology is the connective tissue that links virtual worlds together and makes it easy for developers and brands to bring their experiences into the metaverse. Scaling our technology for millions of LG TV customers is the next step in making the metaverse accessible for all”.

Innovation in this area from LG marks an important development for the consumption of Web3 music, while also teasing us about the future of interoperable Metaverse platforms where fans can take their NFTs from one world to another. LG pushing for interoperability is no small feature to brush over and offers a win-win for the company and consumer where the brand's Web3 strategy can evolve to say an Easter Egg on one platform acting as a concert ticket in another, while allowing people to have a virtual identity that does not have to change across different worlds. This interoperability pretty much ties into our recent coverage of Nikes NFT virtual apparel store and Adidas Virtual Gear wearable NFTs enabling a new definition for our digital presence, and only continues the trend of brands pushing more and more immersive content to their customer bases, powered by consumers owning and interacting with NFTs.

What's the NFTea?

One of the most anticipated mints — Memeland Captainz by 9GAG — minted out a few days ago, with its floor price currently at around 5.65 ETH. However, the collection has received less interest than expected from experienced traders because of its high creator royalties (9%).

Compared to its previous free mint Potatoz collection, the Captainz mint demanded a mint price of 1.069 ETH which is undoubtedly not cheap. Some collectors felt it was way too greedy and reduced margins for flippers.

Whereas many others pointed out that it removes a lot of traders and market makers from providing the project with liquidity and volume, not to mention making most buyers a net negative immediately after purchase... for a 10k generative collection (that has 6-8 weeks before art reveal) nonetheless.

However, there are also counter-arguments from project founders and creators who encourage royalties be used to build up the project and others who want to see less NFTs in the hands of flippers and more in the hands of holders and collectors.

What do you think? Tweet at us @MorningNFTea to let us know!

Huge thanks for joining us today! We hope you enjoyed this edition with the special addition of The Blockchain Brew Up. While we curate the next round-up of news, we wish you a fantastic couple of days, take care!

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DISCLAIMER:

None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.