Non Fungible Tokens / NFTs are unique digital assets that are stored on a blockchain or in a digital ledger. As the name suggests, being ‘Non-Fungible’ it cannot be duplicated and is not interchangeable. Each NFT has unique properties which are stored in the token’s metadata, and this makes it limited to the extent in some cases having only one copy and hence draws its value from being scarce. The history of ownership i.e. the authenticity and the origin of an NFT can be verified on the blockchain through a platform like Ethereum from ‘smart contracts’ which are software codes that authenticate the ownership and regulate their transferability. Unlike fungible tokens like money, NFTs cannot be split into smaller denominations.

NFTs which represent ownership in the digital world can consist of anything from digital goods like pieces of art, collectables like stamps, coins, bags, footwear, clothing, gems, game items, real estate, social media posts, clips of top shot games, photos, trademarks, domain name and even complex financial instruments to various other things that are available in the physical world.

The slow rise of NFTs

It is understood that the first NFT was created as early as 2014 called Quantum by Kevin McCoy and Anil Dash. However, NFTs did not gain popularity until 2020; the wildly popular CryptoPunks created by Larva Labs in 2017 could be claimed for free. Its popularity only boomed in 2021 when the cheapest CryptoPunks was worth US$350K. In May 2021, a collection of 9 Punks was sold at Christie’s for a whopping amount of $16.9M. Sotheby’s sold a rare alien Punk for $11.8 M in June 2021. It is interesting to note that the financial giant VISA have purchased a CryptoPunk in August 2021 at a whopping price of US$150,000 as an addition to their collection in commerce.

The CryptoPunks are now considered the holy grail for any NFT collector.

Interestingly, these Punks can be seen as profile pictures on social media platforms just like the other billion-dollar NFTs Bored Apes – aka (Bored Ape Yacht Club)

India is celebrating the handloom week from April 7 to 14, 2022. While the handloom industry in India is thousands of years old, the industry is slowly dying. Some of the causes attributed to such a decline are the emergence of power looms and the benefits of the industry not trickling down to the grassroots.

In 2003, when India enacted the Geographical Indications of Goods (Registration & Protection) Act, 1999 (‘the GI Act’), there was a belief that registering handloom product names under the same could magically revive the dying industry. Successful European GIs were often cited as examples where registration magically transformed communities. Many Indian handloom products, among others, were thus registered, only to realise later that the GI Act held no magic wand. Despite registration and the ensuing media publicity, the markets are flooded with fakes, product credibility has been elusive, artisans are clueless about their GI ownership, their pockets remain light, and their communities are still underdeveloped. So, what is missing in the GI Act? The handloom week is an opportune moment to examine this.

Sustainable quality control lies at the heart of the success of any GI. Consistent high quality is an attractive force for a customer to repeatedly choose the same product. This can be achieved only through suitable measures implemented throughout the supply chain.

Unlike trademark branding, where it is simpler to get consistent quality for the branded products through licensing arrangements, it is complicated for GI branding. For example, textile brands like BIBA or FabIndia would be typically applied by the respective proprietors or their licensees after a quality check is done on each piece. Whereas, for a Kota Doria or a Chanderi, the GI tag is attached by the artisans, who are numbered in hundreds or thousands. They could be operating from their homes as opposed to factories. These artisans are the real owners of the GI and need no licensing. However, each artisan must ensure quality control by adhering to the specifications entered in the GI Register. Without stringent inspection mechanisms or quality control measures mandated in the legal framework coupled with sanctions for violation of the specifications, diligence and self-discipline of the artisan tends to wear off after a while. That is when inconsistency in quality creeps in and substandard products start to appear in the market.