Regional films, stars, YouTubers tap NFT opportunity
Premium- Celebrities are taking to NFTs owing to the instant connection they provide with young, tech-savvy audiences and its revenue potential
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New Delhi: After Bollywood stars like Amitabh Bachchan and Salman Khan, it is the turn of actors and producers in regional language cinema to adopt non-fungible tokens (NFTs) and make their digital artworks as well as physical memorabilia available to fans.
Celebrities are taking to NFTs owing to the instant connection they provide with young, tech-savvy audiences and its revenue potential.
Malayalam movie star Dulquer Salmaan is the newest to jump on to the NFT bandwagon, having signed up with Abu Dhabi-based technology company Ammbr for his film Kurup, which he is also co-producing. As part of promotions, an NFT sale was held for Kurup late last month, which allowed the film’s poster signed by Salmaan and director Srinath Rajendran, video with embedded music and digital artwork, to be made available for fans. Rapper Raftaar, singer Mika Singh and YouTuber Amit Badana have also tied up with NFT marketplaces over the past few weeks.
NFTs are non-fungible tokens stored on a blockchain ledger representing digital assets that represent real objects such as artwork, music, videos, online games, digital collectibles etc. NFTs are made by creators and purchased by buyers or collectors. The creator of the NFT has an option of creating either a piece unique or limiting the NFT to a limited number. The more unique an NFT, the higher the value it would command.
“Celebrities and actors are major brand owners and have gained popularity over the years through their work, be it movies or music. They’ve used social media to connect and interact directly with fans for a while and now, blockchains have emerged as a form of evolution of the Internet itself," Keyur Patel, co-founder and chairman of Guardian Link and co-founder Beyondlife.club said. Beyondlife.club is the NFT exchange platform on which Bachchan’s auction is going live on 1 November.
Patel and co-founder Arun Pandey said the collection will include Bachchan’s father’s poem Madhushala’s recording in the actor’s voice and some popular costumes, songs and vintage hand-painted posters signed by him.
Actors are using NFTs to put out rare and precious collectibles, that may not be known to fans and which they may not want to be seen on regular social media, Patel added.
Vinay Bhutani, partner at Economic Laws Practice pointed out that a celebrity can auction or sell almost anything belonging to him, whether video clips or pictures of himself or his art, music and paintings in the form of an NFT. “The attraction for such items and their increasing monetary value can be linked with their uniqueness, since they represent a one-of-a-kind token that is solely owned by a person, who in some cases may also own the copyright to the same, depending on the smart contract at the time of sale," he said.
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“Another reason celebrities are enjoying NFTs is because the smart contracts between the buyers and sellers can be coded so that any future sale of the NFT automatically confers royalties upon them as a percentage of the future sale amount, many times in perpetuity," Bhutani explained, adding that the company has seen traction within its advisory team on NFTs and structuring of NFT platforms.
The excitement around NFTs comes from the feeling of owning a digital product that is rare and one-of-a-kind, said Sumit Ghosh, CEO and co-founder of short video app Chingari that has launched crypto-tokens $GARI and its own NFT marketplace with Salman Khan as brand ambassador. $GARI will help content creators on the app set up their e-commerce space for physical merchandise.
“NFTs provide an opportunity to celebrities to monetise their online or digital content, which usually does not get them the best RoI by even going viral on social media. It provides recurring income to the artist when the NFT is sold in the marketplaces and is a way to authenticate the creators of the content or digital art," Ghosh said. NFTs are designed to give you something that can’t be copied, though the artist can still retain the copyright and reproduction rights, just like with physical artwork, he added.
Unlike movies which often lose revenue to piracy, the trend of digital art will definitely see more celebrities joining it in the coming years as everyone wants to be seen as a pioneer in such spaces, said Vijay Pravin Mahajan, founder and CEO, bitsCrunch, an NFT analytics brand.
Vishakha Singh, vice-president and co-founder, WazirX NFT Marketplace that will soon announce auctions for a south Indian language film and a bunch of young YouTubers, said celebrities are looking to stay relevant in times of the covid-19 pandemic with the growing crypto community and to enhance engagement. “However, success of the venture will lie in making actual sales since this has emerged as an additional stream of revenue for them," said Singh whose company has also collaborated with Percept Live, creators of the electronic music festival Sunburn Asia to sell tickets through NFTs.
Though there are concerns around the safety of NFTs, the exchanges said they flag off suspicious activities to one other. L. Badri Narayanan, executive partner, Lakshmikumaran & Sridharan Attorneys said there is currently no express or implied ban on holding or trading in cryptocurrencies, though draft bills such as Banning of Cryptocurrency and Regulation of Official Digital Currency Bill, 2019 and Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 have been introduced in the Parliament, but not passed.
“The regulatory vacuum governing cryptocurrencies and other blockchain driven assets is the biggest risk for NFTs. Another point of concern is whether the creator owns the copyright in the digital art sold as NFT or the person who purchased the said NFT. In various jurisdictions around the world, the general consensus is that the creator retains the exclusive copyright over the work and the NFT is simply a license granted to the purchaser, however, due to lack of specific law or any well-known judicial precedent, it still remains to be tested," said Rajat Prakash, managing partner at legal firm Athena Legal.
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