Inspiration from Punk+Tiffany: Can assets in the virtual and real world be “bidirectionally mapped”?

News from a while ago: “Tiffany” was upgraded to “NFTiff”. The real world actively embraces the virtual world, so that those who hold CryptoPunk NFTs in the virtual world are eligible to buy a physical necklace made by real-world jewelers with the same shape as Punk NFTs. The Punk on the chain came to the world with “tiffany blue” in this way.

This makes one can’t help but start thinking about the future:

A Tiffany designer sent an email one day planning to release a limited-edition necklace. Since I’m a fan, the wallet is already whitelisted. On the release day, I sent N ETH to the designer’s wallet address, and got the NFT of the virtual shape of this necklace; the NFT also has a 3D effect, which can be tried on with AR.

When the necklace is ready, I can “redeem” a physical necklace in the real world; the NFT in my hand does not need to be destroyed, because it will become my “holder identification”. When I got the necklace, I couldn’t put it down. I found that there was a small mark on the back, and I could see the NFT in my wallet by swiping it.

What’s even more surprising is that the necklace is actually equipped with an NFC chip! I wear a necklace to show off everywhere, and once I reach a special location (such as a tiffany museum, offline events, and stores), it will be triggered, and POAP and discount coupons will be automatically airdropped into my wallet. The chip tracks the necklace usage data, and if I allow the data to be used by Tiffany, I can earn some USDC – click “Agree”, and the data usage fee is credited to my NFT wallet.

If I don’t like it, I can still sell it. After the transaction with the buyer, my NFT and the buyer’s payment are locked by a third party at the same time; I send the necklace, the buyer receives the necklace, and the NFT completes the transfer.

This is a beautiful idea, and it seems to be completely achievable. Will the “next wave of applications” be set off by large companies in the real world? A “utility tokenization” with a clear purpose in a real product from a real company in the real world?

After all, “tokenization” is the star feature of web3. If the biggest criticism of web3 is that there are almost no “useful things” in “native” projects, and there is no sustainable, “real business”, what if the “real business” in the real world actively embraces it? ——To “web3ize” valuable things in the real world into “tokens” and trade them with common standards on the open network, isn’t this a “real” application?

Will “everything can be tokenized” really come true this time?

At first glance, this time may really be different. The popularity of Web3 in traditional business seems to be getting higher and higher, from the exchange of Heytea milk tea coupons for tokens to buy virtual stocks, to the exchange of swapcoins for fitness card discounts, if we take a step forward: let the points be traded on the chain——” Wouldn’t it be more attractive to “open trading” to give customers more incentives?

Seeing this, friends who are familiar with the thinking of “Wen Li” should realize that there must be “first glances” in the back.

This is not a new idea, real-world businesses have been exploring the use of “utility tokens” for a long, long time, even going back two cycles – loyalty programs, loyalty programs, miles, points, Countless blockchain people have tried countless POCs, but in the end they are all gone, and there are almost zero successful cases.

What about the Web3 era? The verdict remains the same: the odds are still slim.

We can use “virtual credit tokenization” and “physical enterprises embrace NFT” to argue separately:

1. Can “virtual point tokenization” take off with web3?

If the object itself is already a virtual asset, then tokenization is simple – just changing its own technical implementation. For example, “tokenization of airline mileage points” simply means that “points” will be issued on the blockchain. What does “point tokenization” do? Of course, it can be transferred and traded more widely.

But is it logical? It depends on the “value appeal” of the issuer.

According to historical records, this kind of value appeal is very small. “Tokenization” has subverted the traditional “loyalty program” business model. Merchants of traditional point programs would never want their points to be traded on the open market. The reason is simple: “Loyalty” means “exclusive”, exclusive, exclusive; what it does is stratify customers. In economic terms: “classification” yields higher “producer surplus”; the finer the price discrimination, the greater the producer surplus.

Inspiration from Punk+Tiffany: Can assets in the virtual and real world be "bidirectionally mapped"?

If the airline allows you to sell your own miles and the “volume discount” can be transferred at will, where is the point of “loyalty”? Does the business model still exist?

This not only disrupts the airline’s original intention of “rewarding specific customers”, but it is also easy to be “wiped”. For example, Xiaopao has 10,000 airline points, Mr. Will has 10,000 airline points, and China Eastern Airlines has 20,000 points to exchange for a ticket. So we had the urge to trade – Mr. Will was locked out of the country due to the epidemic, so he simply sold 10,000 points to Xiaopa for 100 yuan, so Xiaopa spent only 50 yuan, and he got there. A free ticket – scooped up wool from the airline.

Going back to the “triangle of value appeals” in “Wen Li” – the interest appeals of the issuers are inconsistent, and they will not do it.

2. Can “entity companies embrace NFT” take off with web3?

If the object is a “physical asset” in the real world, such as Tiffany’s necklace, it is mapped to the virtual world in the form of NFT and can be traded at the same time – isn’t it also “tokenization” to some extent?

The devil is in the details. The suspicion lies in the CryptoPunk bound by Tiffany. It’s a clichéd question: can assets in the virtual world and the real world be “bidirectionally mapped”?

The CryptoPunk that Tiffany maps to the virtual world has only the meaning of “showing off” on the virtual side (see the analysis framework of NFT in “Wen Li”), and it cannot be “reversely mapped” back to the physical asset (Tiffany necklace). The mapping relationship between them must be “one-way”.

Going back to the example of the designer selling a new necklace at the beginning: I bought a necklace and got the NFT of the necklace. The NFT can be intact in the virtual world forever, but it is already the same as the necklace in the real world, which is worn by time every moment. – Unable to map 100%. The necklace will be oxidized, or the hand will be damaged. Can I really use NFT to exchange for the exact same necklace?

Further, if my NFT is stolen, can I still claim the necklace in the real world? Most likely not.

The mapping of CryptoPunk NFT to Tiffany necklace is a bit like a fork of Ethereum – Tiffany shares the value of CryptoPunk NFT, or the value of Tiffany necklace comes from the value of CryptoPunk NFT.

Tiffany can make 100 identical necklaces in the real world, but the CryptoPunk NFT on the chain cannot be copied, only one. This is obviously not true in terms of value logic. The only premise is: no matter how much Tiffany copies, all necklaces add up to the price of Punk NFT – copying equals fraud, and 99 of the 100 Tiffany copied necklaces are all returned to zero. In the end, only the price of one Punk NFT is left.

Conversely, if the Tiffany necklace is the only one in the world (I promise to have only one), like the Mona Lisa, then its price will keep going up.

Here comes the problem: if the price of Tiffany necklace keeps rising, and the value of Punk NFT comes entirely from the mapping relationship with Tiffany, but holding Punk NFT does not mean owning real property rights, then if I sell Punk NFT to someone else, the other party can Can I use this NFT to claim the constantly increasing necklace in my hand?

If you can’t get the real thing, is NFT still valuable?

3. The only established logic: “cross-chain bridge” 

These are just a few of the relationships between the real world and the physical world, which have been explored countless times over the years. The new round of mapping relationships in the Web3 era is still mainly for marketing purposes, and no new model has been born.

The only established logic should come from the “cross-chain bridge”.

In the parallel world of the two chains, only the assets on one end circulate in the virtual and real world, while the other end of the “map” is “locked” – applied to the Tiffany+Punk model: CryptoPunk’s NFT is locked In Tiffany’s wallet, and Tiffany locks and issues real-world necklaces based on this.

It is conceivable that there will be an avid CryptoPunk fan who spends millions of dollars to buy a necklace in order to get Punk NFT, but cannot wear the necklace without a neck, and then returns the necklace to Tiffany – he only needs to show off his CryptoPunk in the virtual world be satisfied.

Vice versa, there may also be Tiffany fanatics who are completely indifferent to CryptoPunk, spend a lot of money to buy necklaces and wear them around their necks, and NFTs discard them. The mapping between entities and reality seems to only appear in the “cross-chain bridge” model, which is a “true” mapping.

Of course, there is more extreme logic than the cross-chain bridge – “choose one of two”, the entity must be destroyed, and the virtual world’s chain can prove its uniqueness, so as to completely eliminate “cross-chain double-spending” and “cross-chain double-spending”. assets at the same time”.

However, this loses another possibility: there will be no necklace fanatics in the real world anymore, willing to pay high prices to buy CryptoPunk in the virtual world – because an out-of-print Tiffany necklace may be in 50 years. Rising to sky-high prices; and once the Punk NFT bubble bursts, it will become worthless. You can only feel sad at this time, because the necklace has been destroyed.

The mapping from virtual to reality can only be maximized by mutual exchange on the cross-chain bridge.


The content of this article is selected from the “Literature and Science Two Blossoms” newsletter. 

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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