5 minute read
JUST THE TICKET
How NFT technology will revolutionise event ticketing. Ryan Kenny, CEO of SeatlabNFT, explains
Blockchain technologies, quite frankly, will impact all industries and sectors. There’s a calling for greater transparency and less monopolisation in current times, and we’re now entering a new dawn of technology that makes all this possible. We’re seeing a clear shift in the ticketing industry towards more innovative solutions that give event organisers increased control over the ticket process compared to more established outlets. But who’s thinking of the artist or promoter?
Big-name artists like Ed Sheeran and Taylor Swift have publicly voiced their concern over the out-of-control secondary ticketing market and called for an end to ticket touting and scalping.
The pandemic has only accelerated the move towards fairer ticketing solutions; the spotlight has fallen on transparency and traceability for organisers looking to get back on track after a turbulent few years.
NFT ticketing technology has the potential to improve traceability, eliminate fraud, reduce the impact of scalping, and incentivise fans in ways never before possible. Blockchain’s public ledger will allow artists and event organisers to form stronger connections with fans by recognising and rewarding loyalty with collectible NFT memories and other exclusive perks. Let me explain how.
WHAT IS AN NFT?
NFT stands for Non-Fungible Token. In short, NFTs are non-interchangeable digital assets stored on the blockchain that people can send between themselves using a cryptocurrency wallet. However, they are not like regular cryptocurrency.
You’ve probably heard of Bitcoin. Bitcoin acts like digital currency; if two people both had one Bitcoin, they could happily swap them with each other and still have one Bitcoin. You can do the same with a £1 coin; it doesn’t matter which £1 coin you have, it’s still a £1 coin.
But NFTs are more like diamonds. If two people had a diamond each, they’d be less inclined to swap them as each diamond will have unique characteristics like cut, colour and clarity. Diamonds are considered nonfungible because while they hold value, no two are the same.
An NFT is a unique, one-of-a-kind digital token.
HOW CAN WE USE NFTS IN EVENT TICKETING?
By issuing event tickets as NFTs, we can take full advantage of the things blockchain technology offers us. NFT ticketing marketplaces are using the increased transparency of the public ledger to make it impossible to forge NFT tickets while simultaneously giving artists and event organisers more control over the secondary market and a new way to incentivise or reward fans.
ROYALTY SPLITS
Conditions can be attached that govern what people can and can’t do with NFT tickets using smart contracts. Royalty splits can transfer a given percentage of the revenue generated from secondary sales to a royalty beneficiary specified when tickets are created. For example, if a royalty split of 15 per cent was set and somebody resold a ticket on the secondary market for £100, £15 would be sent to the royalty beneficiary’s wallet.
This gives artists and event organisers unprecedented control over secondary sales and opens a new revenue stream. Royalty splits take money out of the scalpers’
BACKSTAGE ACCESS: AIRDROP PERKS
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pockets and direct it back to the people who make live events possible in the first place.
If you wanted to go one step further in the fight against scalping, you could turn off the ability to resell tickets entirely or set a resale price ceiling – things which are only possible thanks to smart contracts.
INCENTIVISE FANS
Because NFT tickets are stored in a cryptocurrency wallet, sellers can send exclusive incentives and perks directly to ticketholders. These airdrops can be rare collectible assets such as images, video, audio files or digital artwork to encourage fans to buy upgraded tickets.
When talking about airdrops, I simply mean sending assets to a known wallet address.
Airdropping digital assets can become a powerful marketing tool. One way is by attaching rare collectibles to tickets before the initial sale and airdropping them to ticketholders after the event. Doing this would mean collectibles can be digital media of the event itself, such as backstage video or live audio recordings. It would also provide an opportunity to connect with fans in the days and weeks after the event. These NFT memories would become collectibles in their own right, which fans could trade on the open market generating the issuer royalties each time, in the same way the original NFT ticket could.
Artists and event organisers could also airdrop perks to ticketholders before the event to increase engagement and reward loyalty, such as VIP tickets, backstage passes, or tokens to be exchanged for merchandise. Enabling fans and artists to connect in this way helps form a closer relationship between both parties, and it makes attending events a much more immersive experience.
POTENTIAL ISSUES
One of the biggest challenges all blockchain-based solutions face is how to overcome scaling issues and high gas fees; this is particularly pertinent to NFT ticketing due to the high-volume nature of minting and selling potentially thousands of tickets. Each time a ticket is minted, that is processed as one transaction on the network. Each time someone sells a ticket, that’s another transaction, putting a massive strain on the network.
The well-known blockchain ecosystem, Ethereum, currently suffers from severe scalability issues, making viable solutions only possible on other networks. That’s not even mentioning the environmental concerns associated with some blockchains, but alternatives are available.
Blockchain ecosystems such as NEAR Protocol, Solana, and Polygon offer different solutions to Ethereum’s scalability issues.
CHANGING TICKETING LANDSCAPE
NFT ticketing technology can eliminate fraud, significantly reduce the impact of ticket scalping, and enable artists and event organisers to connect with their fans in a more meaningful way. Event organisers can also tap into new revenue streams by taking control of the secondary market through defined royalty splits on ticket resales, controlled by smart contracts. Airdropping collectable memories from live events will also help you foster a closer relationship between artists and their fans.
There’s no doubt that the ticketing industry will benefit from this new technology, and I’m excited to see what the future holds.
