How Cryptocurrency Is Wildly Creating Breakthrough New Business Models, But Not In The Way You Think
The word cryptocurrency elicits strong emotions. The industry is rife with naysayers on one end of the spectrum such as JPMorgan Chase CEO Jamie Dimon who issue sinister warnings and at the other end, evangelists such as Twitter/Square’s Jack Dorsey touting crypto’s massive, never-ending benefits.
Yet the crypto arena is becoming more than that which simply offers a new way to basically trade and exchange in a self-contained manner through a veritable labyrinth of scams and hacks or simple roads paid with pure gold. No, this is about a disruptive application of crypto for practical business usage that is creating a complete paradigm shift that could boldly change the balance of power in many industries today.
Those in the creative space are starting to stake out territory as early adopters of using crypto as an actual means to a larger end rather than just amassing greater wealth through coins, themselves. These business minds are leveraging new technology to drive goals in the physical world. In other words, this is about taking the ethereal to create the material in ways that are unprecedented.
Indeed, when designer Malan Breton first began his thriving fashion business, he had no idea that he would later begin to leverage digital currency to actually take his work to the next level.
The Malan Breton line, which is already selling well in Harrod’s department store in London, says that it is now poised to become the first designer sportswear collection in the world to be sold with the ability to purchase through both credit cards and cryptocurrency. This capability will be powered by Token Markets and offered exclusively via the social network for creative professionals, SohoMuse.com. The launch is scheduled to take place July 9, 2018.
Here’s how it will work. Purchasers of the exclusive Lord Breton doll the company creates, already massively popular in Asia, will receive the MALAN token as a free gift. The token then will then grant exclusive access to meet Malan Breton, as well as access to his fashion shows, private sales/trunk shows and a 25 percent discounts on Malan Breton merchandise payable via credit cards or cryptocurrency.
“The MALAN token is a first-of-kind experiment using a blockchain to connect brands and their customers,” explains Consuelo Vanderbilt Costin, founder of SohoMuse. She continues, “Malan Breton can jump wholeheartedly into this new world of technology without saying goodbye to his many customers who don’t care about cryptocurrency at all. This collaboration breaks new ground by adding possibilities and better options without forsaking everything that’s come before.”
Instead of using the token as a means of trade investment, Breton is using it as a way to reward and connect more deeply with his customers through new technology.
Mitzi Peirone, on the other hand, has used cryptocurrency to fundraise and has broken barriers in the process. Peirone is the first person ever, and woman at that, to fully fund a theatrical film release via cryptocurrency. This is also her first script and first work as a director.
Peirone faced the same daunting challenge of finding support just as all first-time filmmakers do given the fact that the arena is considered high-risk. “My numbers were too high for crowdfunding. And even if they weren’t,” Peirone explains, “these platforms are flawed because they return too low a level ROI, like signed t-shirts, to make it appropriate for a theatrical release.”
She tried pitching the film to various Hollywood institutions but found that they wanted to change the film to fit various previous standards against which Peirone was adamant. “I felt like I was stuck in limbo,” she says.
Then a break came at a music festival she attended where she just happened to meet Ethereum’s visionary Joe Lubin who explained to her the wonders of cryptocurrency. Through Lubin, Peirone learned about ICOs. “I was humbled about the freedom and decentralization tech could bring and how that could democratize the arts.”
It also turned out that Lubin’s company Consensys was just two blocks away from her apartment in Brooklyn, New York. Soon the collaboration began to bridge the gap between Hollywood and crypto to create what would become an entirely new business model. After a year and a half of planning stages, the project was ready for sale in June 2017. Though Peirone will not disclose the amount raised, she will say that they hit their goal within two weeks of offering the Braid token.
The return on investment that is offered is 15 percent in exchange for 30 percent of net profits. The film was shown at this year’s recent Tribeca Film Festival, and Peirone and her team are now currently in talks for national distribution.
How did she stabilize such a volatile currency in order to ensure accuracy for production costs? “We used Bitfinex to freeze the value and then, of course, we converted it into fiat currency. A truly magical moment.”
But there is just a bit more to this story than the mere skirting of former Hollywood gatekeepers. Peirone points out a striking element for anyone tracking diversity hurdles in business today. “This whole process was so important because I actually never physically saw any of my investors. So my gender never came into play nor did my authority ever get aggressively questioned. That was breakthrough.”
Certainly not without potential pitfalls and operating within a truly embryonic stage, such new business models that are deeply threaded within cryptocurrency are, however, intriguing. These methods can provide the peace of mind for financing and content for which creatives, in particular, yearn. As professionals from various realms come together to blend imagination and technology in new ways to reach business goals, this era will continue to offer untold opportunities on a number of levels.
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