Analysis of potential Business Use-Cases for NFT Technology

Alexander Hohmann

Master's thesis

Abstract:

The following thesis studies the novel phenomenon of Non-Fungible Tokens (NFTs), a way of storing unique digital data, decentralized on a blockchain. NFTs have experienced an unprecedented amount of hype and media attention for their application as digital art during 2021, creating a new sub-industry in the process. At the same time there are many critics of NFTs calling them useless, a scam, and a bubble, and see their views confirmed by the subsequent crash of the NFT market during the past months. This thesis aims to explore the topic beyond the hype and analyze if there are other potential use cases of NFT Technology, except digital art. Through qualitative semi-structured interviews with different stakeholders in the NFT space, opportunities and risks of different business use-cases are identified. The thesis here focuses on a potential application in the music industry, but also explores other industries. The results suggest that NFTs can mainly bring value as proof of digital ownership in a digitalized world, and as a new way for brands and artists to interact with superfans. The main risks lie in the current negative public image of NFTs and an economic downturn, managing the paradox of regulation vs. decentralization, and a lack of a clear business strategy to utilize NFTs.

Abstract:

The following thesis studies the novel phenomenon of Non-Fungible Tokens (NFTs), a way of storing unique digital data, decentralized on a blockchain. NFTs have experienced an unprecedented amount of hype and media attention for their application as digital art during 2021, creating a new sub-industry in the process. At the same time there are many critics of NFTs calling them useless, a scam, and a bubble, and see their views confirmed by the subsequent crash of the NFT market during the past months. This thesis aims to explore the topic beyond the hype and analyze if there are other potential use cases of NFT Technology, except digital art. Through qualitative semi-structured interviews with different stakeholders in the NFT space, opportunities and risks of different business use-cases are identified. The thesis here focuses on a potential application in the music industry, but also explores other industries. The results suggest that NFTs can mainly bring value as proof of digital ownership in a digitalized world, and as a new way for brands and artists to interact with superfans. The main risks lie in the current negative public image of NFTs and an economic downturn, managing the paradox of regulation vs. decentralization, and a lack of a clear business strategy to utilize NFTs.

Keywords

Non-Fungible Token, NFT, Use-Cases, Music Industry, Blockchain, Cryptocurrency

Keywords

Non-Fungible Token, NFT, Blockchain, Cryptocurrency, Use Cases, Music Industry

Language used: English

Date on which the thesis was submitted / produced: 14. 12. 2022

Thesis defence

• Date of defence: 1. 2. 2023
• Supervisor: Michal Andera
• Reader: Karel Pernica

Vysoká škola ekonomická v Praze

Master programme:
Management