Blockchain Funding Models Across Industries

• Art

  • Royalty Sharing: Blockchain technology and NFTs allow artists to receive royalties for each subsequent sale of their work, which is automatically enforced through smart contracts. Once an artwork is tokenized and sold, the artist can receive a royalty for each subsequent sale. This empowers artists by ensuring they continue to benefit from the increasing value of their creations.

  • Direct Sales to Collectors: Artists can use blockchain platforms to sell their NFT-based artwork directly to collectors worldwide, bypassing traditional intermediaries like galleries. This model gives artists greater control over their work and potentially increases their earnings.

  • Fractional Ownership of High-Value Art: NFTs enable the fractionalization of ownership for high-value artworks. Smaller investors can purchase tokens representing a portion of a valuable artwork, allowing them to participate in the art market at a lower cost.

• Gaming

  • NFT Lending and Renting: Players can lend or rent their in-game assets, such as characters, items, or virtual land, represented by NFTs, to other players for a fee. This creates a new revenue stream for NFT owners and allows players who may not be able to afford to purchase these assets to access them.

  • Tokenized In-Game Currencies and Items: Blockchain games can create their own in-game currencies and items as tokens. These tokens can be used for various purposes within the game's ecosystem, including purchasing items, trading with other players, and earning rewards. This model can provide an alternative to traditional in-game economies and create new monetization opportunities for game developers.

  • NFT Sales for Exclusive Content or Access: Game developers can use NFTs to offer exclusive content or access to in-game events or features. This can incentivize players to purchase NFTs, providing additional funding for game development and creating unique experiences for players.

• Real Estate

  • Fractional Ownership: Tokenization enables the fractional ownership of real estate properties. This means that multiple investors can purchase tokens that represent a portion of a property, allowing them to pool their resources and invest in properties that would otherwise be out of reach.

  • NFT-Backed Mortgages: NFTs can be used as collateral for mortgages. This could streamline the mortgage process and potentially reduce costs for borrowers.

  • Real Estate Investment Trusts (REITs) on Blockchain: REITs can be tokenized on a blockchain, allowing investors to purchase shares in a diversified portfolio of real estate assets.

• Decentralized Finance (DeFi)

  • NFT-Backed Loans: NFT owners can use their NFTs as collateral to obtain loans. This provides NFT owners with access to liquidity without having to sell their assets. This model has been particularly popular for high-value NFT collections, such as Bored Ape Yacht Club, where owners are reluctant to sell their assets but may need liquidity for other investments.

  • Decentralized Liquidity Pools: These pools aggregate funds from multiple investors and are used to provide liquidity for various DeFi protocols, including lending platforms, decentralized exchanges, and yield farming protocols. Investors can earn interest by depositing their crypto assets into these pools.

  • Yield Farming: A form of investment where investors provide liquidity to DeFi protocols and earn rewards in the form of tokens or interest.

• Infrastructure

  • Tokenized Debt for Infrastructure Projects: Bonds or other debt instruments for infrastructure projects can be tokenized, allowing investors to purchase fractions of the debt. This can attract a larger pool of investors and potentially lower the cost of capital for these projects.

  • Security Token Offerings (STOs): STOs allow companies to raise funds by issuing security tokens that represent ownership in the company or project. STOs are subject to securities regulations and offer a more regulated way to raise funds using blockchain technology.

These examples showcase the innovative ways blockchain technology is being used across different industries to create alternative funding models. These models can provide more efficient, transparent, and accessible ways to raise capital and invest in a variety of projects. As blockchain technology continues to develop, new funding models are likely to emerge, further transforming the financial landscape across multiple sectors.

It is important to note that the legal and regulatory frameworks for blockchain-based funding models are still evolving. It is crucial to be aware of the potential risks and challenges associated with these models, such as market volatility, security vulnerabilities, and regulatory uncertainty, before participating.