• Skepticism about the digital market – NFT just a trend?
• Lose contact or win new, young customers?
• future music? Banks in the Metaverse
In the past year, the NFT market has experienced a veritable boom, with top prices being paid for digital artworks. Trading volume in the first quarter of 2022 was $16 billion, according to NonFugible figures. This corresponds to an increase of over 700 percent compared to the same quarter of the previous year and 13.25 percent compared to the fourth quarter of 2021.
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Again and again examples of celebrities make the rounds, whose own NFT collections are so hyped that they are sold out within a few hours at horrendous prices. Most recently, Anthony Hopkins also searched for recommendations for NFT projects from prominent NFT enthusiasts via Twitter.
Banks and NFTs
Although the banking and finance industry has so far been rather skeptical about the NFT market, there are some areas of application for the finance industry. The financial expert Bernd Oppold, partner at KPMG Financial Services, is even of the opinion that the banks should not make the same mistake here as in the area of digital payment transactions, when providers such as PayPal or Klarna relegated the financial institutions to their place.
It is now time for the banks to deal with the issue and possibly develop strategies for this still young market. In his article on geldinstitute.de, Bernd Oppold cites the online broker Trade Republic, which has already won over two million customers with shares in connection with NFT projects, as an example of how the market is worthwhile. This enabled the company to gain young customers in particular, few of whom had previously invested in shares.
For the banks, Oppold sees a managerial role in the NFT market. In the previously decentralized market via platforms such as OpenSea, banks could offer customers storage space via multi-signature wallets. These would be comparable to a share account, protected from unauthorized access and would have several advantages for customers: “You no longer have to search the depths of the Internet for wallet providers, you only have to knock on the door of your advisor. And you have to no longer get involved in complicated processes that they may not have understood down to the last detail. A bank or a financial service provider can provide security here,” says the banking expert.
Since the digital asset market for established players is filled with many unknowns, many banks are still struggling in this young, unregulated market. However, established financial institutions in particular could find their role in classifying tokens and making processes transparent. Banks could offer their customers specific projects in the fields of digital art, music or sporting events, thereby driving both the market and their own business forward.
Banks in the Metaverse
The next big step for established financial institutions would be the metaverse: banking services in a whole new ecosystem. Some so-called neobanks are already offering their services on Web3. These direct banks conduct their business exclusively online, for example via an app, and do not have a branch network.
South Korean banks, which are already present on some platforms, were pioneers in entering the metaverse. The internationally best-known bank with a branch in the Metaverse is JPMorgan. The major US bank has acquired a piece of land in “Decentraland” for its Web3 project and this year opened a virtual bank branch, the “Onyx Lounge”, in which customers will be advised online in the future.
Editorial office finanzen.net
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