The Rise of NFT Impact Investing
Non-fungible tokens, better known as NFTs, took the world by storm in 2021. By the end of December, $2.1 billion had been invested globally, representing a staggering increase of 6,523% over ratio to total 2020 investments, according to CB Insights. NFTs have captured the attention of investors and collectors in the art, music and creative industries, as well as real estate and sports. But now there is a nascent movement in the international development arena for NFT investment as a driver of social change.
This new frontier of international development impact investing through NFTs has yet to be fully explored, but interest in sustainable investing is not new and Bloomberg Intelligence believes the value of investments globally will reach $50 billion by 2025, up from around $41 billion in 2022. In a 2019 survey by Morgan Stanley, 85% of respondents expressed an interest in sustainable investing. The percentage of millennials interested in sustainable investing was even higher at 95%.
Given millennials and Gen Z’s reputation for preferring values-driven investing, NFT impact investing ticks a lot of boxes. Examples of such projects include Brazilian climate tech firm Moss.earth’s Moss Amazon NFT, which allows investors to preserve a small portion of the Amazon rainforest. Others include Blazed Cats, which donates 10% of every sale of a Blazed Cat NFT to Mental Health America, and the Gents Club, a philanthropic organization based on an NFT collection of 6,666 unique digital crypto gentlemen.
Further, Dr. Noel Apkata is on a mission to lead social impact investing on the African continent through this unconventional route. Apkata’s project, Krowd Power NFTs, builds on his experience working with international development organizations, the federal government and the private sector as the founder of an innovation strategy consultancy in his country. of origin, Nigeria. It was this idea of using innovation to achieve Nigeria’s longstanding economic development goals that prompted Apkata to pursue the NFT path.
Seeing the opportunity presented by a global community of NFT enthusiasts, Apkata first pitched his idea to the Global Steering Committee of the Global Social Innovation Forum – of which he is a member – to launch the project in Nigeria. “The organization champions social innovation ideas globally and I have a mandate for Africa,” he says.
Linking NFTs to social impact projects
According to Akpata, targeting NFT projects to global enthusiasts to fund social impact initiatives will create a virtuous circle in a closed-loop scenario. A subscription-based membership community with multiple revenue streams offering the ability to purchase NFTs with purpose is Apkata’s vision. “This global community of NFT collectors can know that they support what we are doing in Africa,” he says.
Apkata is a doctor by training, so it made sense to start with health-focused projects. Krowd Power NFT’s first project is to bring world-class medical equipment to six selected hospitals across Nigeria, one for each geopolitical zone in the country. The project plans to make presentations to its NFT community showcasing the necessary equipment, and then crowdsourcing through the purchase of NFTs related to the project.
“We will create an NFT project around the whole process – when the process starts, when the equipment is purchased, where the equipment is installed and how people benefit from using the equipment,” says- he. All of this will give the community of NFT buyers a sense of ownership in the impact of the project. “They may think, ‘I was one of those who made this happen,'” Apkata says.
Additional social impact can be realized in the eventual development of a medical industry cluster around the NFT project site. Once medical equipment is purchased, hospitals can provide services to locals and develop medical tourism capacity. “For example, a medical procedure may cost $50,000 in the United States, but could now be available in Africa at $15,000, for [non-Africans]. And for Africans, we can charge $300 or $200,” says Apkata. In an ideal world, Apkata sees NFT projects eventually covering many aspects of the medical industry, from serving local nationals and medical tourists to creating an environment where medical devices can actually be designed and produced. . “The project can potentially cover a whole range of operations and activities,” he says.
In the spirit of Apkata, a global community of NFT collectors already exists, so why not collect with a purpose? And while NFT impact investing is arguably altruistic, there is a financial benefit, he insists. The value of an NFT depends on its impact over time and depends on what the digital asset is linked to. “The financial value of our NFTs will be directly related to the level of social impact we have on the ground and the level of international branding it gives them,” says Apkata.
Although Krowd Power NFTs is a first for Nigeria, Apkata believes others will follow and this new way of fundraising will become a growing trend. The will of the international community to help is strong, he said, adding, “A prosperous Africa is a prosperous world, and everyone wants Africa to succeed.” But talk is cheap and action is expensive, and Apkata believes the global NFT collective has the potential to follow and make a difference in international development.