HYBE Is Doing NFTs, Here’s What That Means And Why Some Fans Are Concerned
HYBE held their corporate briefing 2021 Briefing With The Community via live broadcast for fans to attend. It included lots of updates about the company’s future plans, involving current groups such as BTS, TXT, and ENHYPEN, as well as a future boy group and girl group.
While fans were excited about most of the updates, particularly those involving their favorite groups’ new Naver Webtoons, some news left fans concerned. And, we’re not referring to the possibility that the groups might discover fanfictions on Wattpad.
During the live broadcast, Bang Si Hyuk (also known as Bang PD and Hitman Bang) announced that HYBE would be getting into blockchain technology. He shared that HYBE is passionate about innovating and developing an even greater fan experience.
If all we’re trying to do is recreate past experiences online, we can’t call it innovation. The ‘new and innovative fan experience’ that will unfold in HYBE will include future experiences that fans have yet to experience but which they need most of all. Just as the release of WEVERSE has enabled real-time communication and connection between artists and fans, we hope to once again create a synergy between the music industry and new technologies so that fans can experience the future firsthand.
— Bang Si Hyuk
He sees an opportunity in the hot topic of cryptocurrency. So, HYBE is partnering with a company whose focus is on innovative technology.
After a deep contemplation, we have found a partner company that supports HYBE’s vision and the values that HYBE cherishes, and through a joint venture established under a strategic partnership will create businesses that will soon become reality.
— Bang Si Hyuk
HYBE’s new partner, Song Chi Hyung, Chairman of Dunamu Board of Directors, introduced himself as an “entrepreneur who dreams of industrial innovation, just like Chairman Bang Si Hyuk.” He emphasized a shared vision as the HYBE’s event theme was “boundless.” He claimed it was a word that “aptly represents the values that the Dunamu has been pursuing as well.”
For those unfamiliar with Dunamu, the chairman explained the company’s mission. They focus on uniting finance with technology.
We are a fintech company that pursues innovation through the meeting of finance and technology. Our company name ‘Dunamu’ also means the adjoining of two big tree trunks: finance and technology. I wanted to talk about our company for those of you who may not be familiar with the name.
— Song Chi Hyung
He gave examples of some of their current operations, many focusing on blockchain technology and stocks.
First, we operate ‘Upbit,’ a digital asset exchange based on blockchain technology. With the goal of creating an ‘industry standard’ for blockchain and fintech, we also operate the Digital Asset Standard Index service which allows users to check the overall flow of the digital asset market, Securities Plus, which helps users to check stock information and link trades in regardless of the brokerage firm, and Securities Plus Unlisted, which innovatively improves unlisted stock trading.
— Song Chi Hyung
So, what exactly do a music company and a digital finance company have to do with each other? Bang Si Huk explained that they plan to partner together to develop an NFT business under a new joint venture. It will allow artists’ IP-based content to become digital assets for fans.
The hot topic of this year’s fintech industry is definitely NFTs, or non-fungible tokens. I think the word ‘irreplaceable’ was used in one of the BTS’s songs. Irreplaceable, meaning something that is unique and one of a kind.
— Song Chi Hyung
Song Chi Hyung explained in detail about NFT. Basically, it will eliminate any possibility of “counterfeit products.”
You can think of an NFT as an irreplaceable digital asset that can be safely and reliably verified so that anyone can trust that there is only one in the world. Such digital assets are created when specific digital content or products are given a unique value through blockchain technology. This value becomes truly manifest when combined with areas where intangible assets are important, such as the games, arts, and entertainment industries, which are brought to life through creative activities. This is because it is a technology that eliminates the counterfeit products that have been prevalent in the past, leaving only the authentic, and gives legitimate benefits to the only people who have created unique value and the customers who have discovered and have given their support to that value.
— Song Chi Hyung
Though fans are hesitant to welcome this new “product,” Bang Si Hyuk and Song Chi Hyung believe they’re ready for it.
We are already seeing concrete results, especially in the arts industry, and I believe that the fandom culture and industry itself are maturing to the level where HYBE’s artist IP-based content and products that the HYBE showcases are now at a sufficient stage to be transformed into digital assets through these technologies.
— Song Chi Hyung
Bang Si Hyuk then explained their plan for NFTs even simpler. He brought out one of the most recognizable pieces of merchandise for fans other than albums: photocards.
To make it easier for you to understand, I’ve brought something that has a special meaning to our fans: the photo cards that fans collect. Some of you may be familiar with them, and some of you may be surprised by their existence. In addition to their appearances on stage and in music videos, these photo cards are a kind of behind-the-scenes images that capture the various charms and moments of the artists.
— Bang Si Hyuk
He introduced the potential for digital photocards. It will be much more than just a cute behind-the-scenes selfie. Instead, it’ll give an extra interactive experience as it may include moving images and audio.
Many fans explore ways to keep for a long time, and since they are released in limited quantities, they are sometimes exchanged among fans. We are working with Dunamu to create a way to expand the fan experience more diversely and securely, such as digitally authenticating the uniqueness of these photo cards and making them permanent, but also allowing them to be collected, exchanged, and displayed in a global fan community platform like WEVERSE. Instead of a single frame photo, it can be turned into a digital photo card with moving images and sound.
— Bang Si Hyuk
In some ways, the concept sounds familiar. For years, QR codes were included with the purchase of BTS albums, giving ARMY an additional “freebie.” For example, after scanning the code, ARMY would receive a short video of a member saying, “Thank you.”
The Dunamu chairman added, “Exactly. As you mentioned, we can think about creating a more synesthetic experience, like providing images, music, or the voice of the artist, when you click on the photo card.” With this upgraded photocard, fans will still be able to trade photocards. Still, it will eliminate any possibilities of being tricked into purchasing fake versions, a problem that can often occur with online sales and trading.
For example, I think we can have fans come together and exchange cards with each other in a virtual space like an online community, such as WEVERSE you just mentioned. We will think hard and concentrate on developing a complete service so that convergence of Dunamu’s fintech technology and HYBE can bring another extended fan experience of value sharing and value exchange for fans around the world.
— Song Chi Hyung
From the briefing, it seems as though Bang Si Hyuk imagines a transition from physical to digital for photocards. He also hinted at more digital fan experiences for the future.
Adding on to that thought, it seems like it won’t be long before we can use digital photo cards within the platform to create a virtual space with our avatars, and fans can show such a space to each other and to the artists. In order to make this a reality, we will bring together the capabilities both companies have built up so far to introduce a new and exciting innovation to the global music and fintech industries.
— Bang Si Hyuk
Initially, the digital alternatives to physical albums and photocards seem like they might actually be better for the environment as the physical products can come with lasting impacts on our planet. Unfortunately, this alternative mentioned is not better.
For those still confused about what exactly an NFT is, let us explain some more. NFTs (non-fungible tokens) are a type of cryptocurrency. According to Wikipedia‘s definition, cryptocurrency is a “collection of binary data which is designed to work as a medium of exchange wherein individual coin ownership records are stored in a ledger which is a computerized database using strong cryptography to secure transaction records, to control the creation of additional coins, and to verify the transfer of coin ownership.”
So, an NFT can be a unique digital item in that it can come in many forms, data, music, text, graphic art, pixels, etc., essentially anything that can be “created” and shared on the internet. Now, they are being capitalized in that creators can authenticate and “mint” them.
Afterward, they are then sold online, usually for a high sum of money. The buyer then gets to obtain this one-of-a-kind collectible content.
Sure, you can copy/paste, download, screenshot, and technically have the same content as the original. In this case of obtaining a NFT, though, you would own the 100% original and authentic content rather than a copy.
one of these popping up on your screen https://t.co/KhVuaVQTYP pic.twitter.com/SeACxV2ARy
— mon⁷ (@knjgIoss) November 4, 2021
With being minted, the NFTs then contain their unique identification codes. Think of it like fingerprints or DNA that tells us apart from someone even if they may imitate our outward appearances. There’s still the only one you.
When NFTs are sold, it’s no longer under the ownership of the original creator. You essentially then have “bragging rights,” and it can increase in value over time.
While, to many, it sounds cool and “innovative,” it does come with consequences, that of which has a lot of fans concerned rather than excited as Bang Si Hyuk may have expected.
For example, French artist Joanie Lemercier had no idea his NFT release would result in 8.7 megawatts of energy being used for its auction. This is basically how much energy a graphics art studio creates but in like two whole years… This artist did it in only ten seconds.
Especially when you consider fandoms and how passionate they become with new merch releases or collectibles, this is concerning. Still, NFT is such a big deal at this point. So, of course, HYBE is not the only one who has gotten involved with cryptocurrency.
A.C.E was the first K-Pop group to tokenize their wares as NFTs, releasing a collection of digital collectibles for fans back in April 2021. Agency Asian Agent defended their choice as fans criticized their involvement.
An open letter to CHOICE: pic.twitter.com/vNnj7NfzBM
— ASIAN AGENT (@asianagent) April 28, 2021
Despite original good intentions of innovation and even donating a portion of sales to Asian Women Alliance, supporting the AAPI community during a rise of hate crimes, fans couldn’t ignore the cons.
Considering the amount of carbon footprint, it’s unignorable. According to QUARTZ, “Over its lifecycle, the average NFT will accrue a stunning footprint of 211 kg of CO2, equivalent to driving 513 mi in a typical US gasoline-powered car.”
Now, with HYBE’s introduction of NFTs, fans of BTS, TXT, and ENHYPEN are facing the same dilemma. Many have voiced their concerns on social media.
bts being representatives for the fight against climate change and championing sustainability just for hybe to turn around and enter the nft market how does any of that make sense.
— SLAYERIN DAY (@805online) November 4, 2021
hybe gon need to realize this whole nft thing ain’t cute especially when bts just spoke abt climate change in nyc literally a month and a half ago… are they dumb…. pic.twitter.com/amJNdV2kRl
— Jordan⁷ misses ateez SHOTA BIRTH (@yuyuluvclub) November 4, 2021
ARMYs have resurfaced a Tumblr thread that explains the problematics of NFTs further with a perfect analogy…
So, clearly, NFTs are not just innovative. They are actually bad for the environment, so in reality, they are not innovative. Rather they could actually damage the future, which completely goes against the idea of innovation.
if hybe is rlly going to go through and do this, i think it’s really good idea to not give in on this one. they are terrible terrible for the environment. there’s plenty of other ways to support 875. don’t do it via NFTs. please.
— 🦋 lizi bug 🐛 shop prep (@lizeok) November 4, 2021
ARMY has also brought up the fact that it seems inconsistent with HYBE’s message. Their artists, especially BTS, regularly speak on world change, environmental impact, among social issues.
In September, BTS spoke about many important topics at the 76th United Nations General Assembly (UNGA) as special presidential envoys to President Moon Jae In.
J-Hope touched on two relevant yet controversial world issues right now, such as vaccinations for COVID-19 and climate change.
Not only that, but they even wore suits from sustainable fashion brand RE;CODE at the event. The brand revealed, “This (BTS’s) suit design aims to support sustainable fashion, and it is particularly designed for BTS’ speech at United Nations.”
BTS have consistently communicated their concern for world issues, such as climate change, even in their brand sponsorship deals. In 2019, they became global ambassadors for ABB FIA Formula E Championship, a race using only electric cars.
Likewise, Hyundai Motor Group chose to collaborate with BTS due to a common eco-friendly vision. Just this year, the two celebrated Earth Day by raising awareness for sustainable living.
The BTS members’ personal lives reflect their commitment to eco-friendly living too. Leader RM doesn’t use disposable plastic utensils even when ordering food. They also are passionate about recycling.
Plant-based meals, second-hand clothes; there are many ways to protect our future. #IONIQ is one of them.
What are you doing to change the world? Tell us below for your chance to #win a #HyundaixBTS prize! Contest closes Dec 3. T&Cs: https://t.co/GXuL0jPAVU#BTS @bts_twt pic.twitter.com/RukJrh6Dcm
— Hyundai Worldwide (@Hyundai_Global) November 26, 2020
While they have are ambassadors for car brands though as mentioned electric, many members choose to bicycle rather than take a car, reducing carbon emissions. Just in the past couple of days, both RM and Jin shared with ARMY that they were biking home after getting off work.
Driving a car at 100 mi actually releases 20% of the emissions that the average NFT sale releases.
yeah im toe-geunning.. 😪 pic.twitter.com/y1LFXT3sGA
— 방탄소년단 (@BTS_twt) November 2, 2021
It seems like it might be the case that the members are not aware of everything their company is involved in with its growth. An ARMY posted to Weverse, telling BTS to leave their company following the news of HYBE’s involvement with NFTs. Jin replied, clearly surprised by the suggestion.
OP: guys let’s leave the company
Jin: heok (oh?) why
ARMY hopes HYBE will revaluate its plans so that the company and its’ artists’ messages will be consistent.
Read more below:
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Bang Si Hyuk Responds To Fans’ Concerns About HYBE Creating NFTs
BIGHIT MUSIC Announces Metaverse Event For TXT, But MOAs Have Mixed Feelings
NFT Company Under Fire For Selling Artists’ Music Without Permission—Including BTS And BLACKPINK