Forget passing fads – this is a market projected to grow up to $70 billion by 2032. But growth alone doesn't equal success. The dirty little secret of nearly all these digital revolutions is that the makers, the musicians, the authors, the artists are too often left holding the bag. That's where NFT royalties come in. They aren’t simply an administrative technicality, either. They are the potential lifeblood of a vibrant, inclusive digital fashion economy to come. Think of it like this: it's the difference between a fast-fashion sweatshop and a couture atelier where the artisans are respected and rewarded.
Are Royalties the Key to Fairness?
Picture this—you create the most beautiful virtual dress in the world to send to DressX, one of the world’s leading digital fashion marketplaces. Then someone makes the purchase for their new metaverse avatar, and it subsequently goes on to be resold and traded across other interoperable platforms. In addition to royalties, without which you, the creator, are cut off from all that downstream value. It’s akin to writing the next viral hit and only receiving royalties after the first radio station plays the song. Royalties, which are baked into the NFT itself, let you rake in a percentage each time your creation is resold.
It's the Wild West out there. Platforms like Over, which focuses on AR experiences, and Auroboros, known for their futuristic virtual couture, might have different approaches to royalties. Some platforms may choose to automatically enforce royalties, others require manual tracking or, quite frankly, the lack of...nothing. This absence of standardization is a huge issue. It’s as if the world used one currency but each country calculated its exchange rate separately and arbitrarily changed it daily.
The question then becomes: how do we ensure these royalties actually reach the creators? The answer isn't simple. Doing so will take more than technological solutions (improved tracking, more use of standardized smart contracts) - it will take a change in culture. Platforms need to prioritize creator compensation, not just maximizing their own profits. Ethics as well as economics It’s not just an economic question—it’s a fundamental matter of ethics.
Royalties Incentivize Innovation and Creativity
Think about the incentives at play. If a digital fashion designer knows they'll only get paid once, they might be less likely to take risks, to experiment with new designs, or to push the boundaries of what's possible. If they know they'll benefit from the long-term success of their creations, they're far more likely to invest their time, energy, and talent.
That’s where the social good part comes in. For example, digital fashion can be truly inclusive with more affordable and accessible opportunities for self-identity and expression. But if the people who make it can’t pay their bills, that promise will never be fully realized. Fair royalties are more than an issue of fairness. They’re key to uplifting a truly vibrant and sustainable creative ecosystem that enriches us all. Ahsan, for instance, has been an advocate for financial literacy and the ways it can empower people. Implementing royalty structures could be a powerful way to educate younger generations about NFTs, blockchain technology, and the value of their digital creations. It's financial literacy in action.
Consider the alternative: a digital fashion world dominated by big brands, churning out mass-produced virtual garments with little regard for originality or artistry. Royalties help level the playing field, giving independent creators a fighting chance to meet their full potential. There’s no better example than the difference between a virgin, native, thick, robust prairie grass ecosystem versus a sterile, homogenous monoculture.
Will Digital Fashion Teach Financial Literacy?
Digital fashion’s natural ties to NFTs also allow digital fashion to foster a deeper financial education — especially for younger generations. Now picture that same teenager designing and selling a virtual accessory that she creates once but receives royalties on every time it’s resold. This would not be mere play, rather, a substantive real-world lesson in the economics of steerage, the role of intellectual property and the emerging power of decentralized finance.
We need to do it responsibly. We don’t want to launch our young people into the deep end of the workforce without first teaching them how to swim. It’s up to us to inform them of the hazards and benefits of NFTs. What is even more important than celebrating smart contracts is warning folks about the crypto space’s many dangers. Consider it digital couture as onboarding drug to responsible money management.
At the end of the day, it’s up to all of us to figure out how we build an equitable and sustainable digital fashion ecosystem for our creators. NFT royalties can’t solve all that’s wrong, but they represent an important starting point, integral to the larger picture. By prioritizing creator compensation, fostering innovation, and promoting financial literacy, we can unlock the full potential of this exciting new industry. Together, let’s ensure that the digital fashion revolution is a revolution of, and for, everybody – except those platforms.
The digital runways are ready. Are we?
