Lorenzo Colautti - From digital art to real-world Impact: the NFT as a product passport

Guys, first of all, I'm Bianca, the moderator for the next three panels. I'll introduce the guys. So, today we're going to talk about digital art impact and the real-world impact of NFTs as product passports. Lorenzo Colauti, IT professional and blockchain consultant, founder of Certify. Since 2020, Lorenzo has supported companies in certifying internal processes and product data using infrastructure and blockchain, promoting innovation and transparency in various sectors.

an exploration of how NFTs can go beyond digital art to become verifiable product passports . Lorenzo will illustrate how blockchain-based certification can strengthen trust between producers, sellers, and consumers, transforming INFT into tools for real impact and accountability. I'll pass you now, Lorenzo. Good morning everyone. I'm Lorenzo Coluti, as my colleague already mentioned.

I'm a mobile web developer, so I'm an IT professional, and those are my LinkedIn email contacts, if you need to take note. My background is as an IT professional, so basically everything I've seen I've seen while working in the sector and I approached the blockchain sector in 2017, then I initially worked with a block explorer and subsequently I started to approach more companies and I was CTO of a startup that is to say that works precisely in the logistics sector and the goal was precisely to notarize on blockchain and everything that happens within an international shipment. Excuse me for a moment. So, blockchain technology, as you know, was born in 2009. In reality, it wasn't born in 2009, but it was exploited since 2009 by Bitcoin, which began to create a system to make finance completely decentralized and without intermediaries.

In 2014, actually it's not true, in 2013 there is a small error in the slides, Etherium is born . The goal is to improve on what Bitcoin has done , to complete it; no longer an exchange of value, but we will have our own real software that runs within the blockchain, real code. So, as I told you, eh we have on Bitcoin the goal is to revolutionize finance. There are key technologies that are being brought, that are being used by Bitcoin that already existed, they were not invented by the person who developed the Bitcoin structure, which is a peer-to-peer network , which was already resistant and Mul, for example, used it and the asymmetric public key cryptography and the ashing algorithms that Bitcoin uses, the SH256 Etherium algorithm. Instead, it aims to innovate what Bitcoin did, as I was telling you before, so in addition to the technologies that Bitcoin already had, it brings in a new programming language which is Solidity and a new concept, the smart contracts which are real code that is executed inside the nodes when a function of these smart contracts is called.

So decentralized applications are born , that is, those applications that are starting to use the blockchain as a system of trust, transparency and one of the first of the apps, so the kittens are also returning to the blockchain in addition to having invaded the internet, one of the first of the apps is Crypto Kittis, which is an interesting little game in which, uh, little kittens can unite and create new generations of kittens. It's a triviality, if you like, but it's the first approach to using smart contracts and above all it's a first approach to using NFTs. They are the ones who developed the standard smart contract for NFTs. The gameplay is precisely that of purchasing digital kittens and being able to combine them to create unique properties, unique identities and also an example of digital collectibles, that is, those like those digital cards like those of Pokémon which are essentially digital and can be purchased or can be evolved through the use of NFTs. At Crypto Kitties we have a diverse list of projects.

The most important on the market were the Crypto Punks and the Borde Ych Club. In fact they don't do anything different, they are simply little images that are sold, they can evolve and then they can be sold later at a higher price than the purchase price. In fact, it is the beginning of what will then happen through the marketplaces, with the possibility of also being able to make a financial profit from the purchase and sale of these NFTs. the real innovation is starting to happen with Gamefy, where NFTs are used within games that can be used for staking or can be used to go and play a bit with digital currencies. Three examples are The F Kingdom which is on Avalanche, for example, The Cent and Gode which are on Ethereum.

Gamefy is a first step in using NFTs on games and we begin to use NFTs no longer as static images, as works of art, as in theory the P Cryptopunks, the BCH Club or the Crypto kitties would have been, but as real interactive games where the user can use a platform, can enter inside and play with it. Inside there are also systems of decentralized finance, precisely to ride the wave of digital currencies, of digital tokens, they exploit NFTs precisely to ride this wave. marketplace is born. Open is one of these, so users are allowed to sell easily, but also create more simply, without having to have the knowledge of how to develop smart content, or how to release it on the blockchain. Open C, for example, is the first one that was born, perhaps the best known, but there are many others, both on Ethereum and on other networks, because we know that there is not just one blockchain.

Etherium is one of the main ones, perhaps besides Bitcoin, but there's also Avalanche. There's the whole Avalanche ecosystem, which is a set of blockchains starting from the mainnet techniques, Polygon and Solana, maybe with different smart contracts, with code in different programming languages. Solana uses Solidity and this has allowed a small financial bubble due to the explosion of the NFT market value. We have cryptopunks that have reached a value of 30-50 ether when iter was at its all- time high of $4,500 $500. Cryptopunks and crypto kits are the same, but it has also allowed many artists to be able to publish digital art such as photos, such as digital images made perhaps by hand, using the Open Credit system to be able to create NFTs on the spot, and then release a smart contract in a simplified way, simply by entering the name of the collection and then uploading the image of the photo for those who are perhaps a photographer or the digital drawing, for those who are digital artists, the possibility of being able to release their NFTs on the blockchain .

NFTs, therefore, go from collectible elements like cryptopunks, like cryptitties, to having their own assets, because then at this point we have an NFT that is no longer the actual image of the metadata that it contains that makes up the NFT, but it is a real digital certificate. A photographer can publish an NFT of his own photo to identify that he is the author and in fact through the transaction on blockchain it allows him to allow the whole world to be able to give the verifiability that it is his address to have released that NFT and above all it has a time stamp that certifies the date of release of the NFT. The timestamp is very important in the blockchain world because we think of transactions as data that is inserted into the blockchain. Actually, that's not the case. A transaction is an event.

A transaction is an event that certifies that a piece of data, a specific piece of data, has a specific piece of information at a specific date, which is precisely that time stamp. That data may change in the future with further transactions, but if I look at the set of transactions I can see how the data has changed over time and, above all, I can see what value it had at a specific moment in time, and that value cannot be changed; it is immutable. One thing I also wanted to show you is some numbers. These numbers here were taken from a website called Kraken, which is a centralized exchange, and 5% of people between the ages of 18 and 34 own an NFT. This figure actually drops to 1% above the age of 54.

The NFT gaming segment raised $1.1 billion. All this in 2024, these are 2024 data, 1.1 billion dollars is a lot for the NFT gaming segment alone. The global NFT sector, however, generated a turnover of $4 million with over $15 million in sales.

This means that in 2024, even though we haven't heard much about NFTs, they're still a market that generates value. What is an NFT? So, we talked about NFTs now, but an NFT is a non-fungible token. In fact, as the word says in English, it is a non-fungible token. If I have €1 and exchange it with someone else, I exchange the same value for another euro, in fact I do not have a real change in what remains in my wallet.

All tokens, all cryptocurrencies are fungible, meaning I can exchange them equally. an NFT no, because an NFT is minted only once, it is a single copy within a network, obviously, because I could have released the same contact on multiple networks, but within a network that NFT is absolutely unrepeatable. In fact, that NFT, in the transaction that generates the NFT, some metadata is recorded on the blockchain, but very little is known. In reality, it is usually a URL that actually points to data external to the blockchain, to external information which could be a cloud like AUS, they represent, as I said before, a unique, non-interchangeable object. You can imagine NFTs just like art: even though two digital works, like the Mona Lisa or Van Gogh's Sunflowers, are beautiful and have an inestimable value, they are not interchangeable in an equal manner because they are not the same painting, they are two different paintings by two different authors, and therefore it is not an exchange that does not generate a difference in value, which is a subjective value.

However, in art, a subjective value remains and acts as a permanent digital certificate . A transaction, an actual n is generated by a transaction that is verifiable on the blockchain. Blockchain is always a public ledger, it can usually be queried via a block explorer, so for example Itercan for Ethereum, AvaScan for Avalanche or Ruscan for Avalanche, but there are many others. If Polygon Scan however Polygon each network has its own Block Explorer. Or if there isn't one because perhaps the Block is too small or Block Explorer has never been developed, it's possible to query the nodes publicly.

Nodes, therefore, are always interactable. These are the standards for NFTs. These are them. There are some, there are some more. Actually, actually, someone has also added added standards, they have been accepted, a community there hears us for two hours, made a kit made the NFT cass, what we identify as NFT.

Then there are others and subsequently the 1155 was born, I won't go in order, and I don't like to put it in NFT denominations because they are not real NFTs, even if the block explorers see it as an NFT, they are semi-fungible tokens, meaning as long as there is one as long as only one is generated for each token it is an NFT, but there can be generated more than one. They are essentially collections of tokens that can be generated in multiple copies. This one, for example, the 1155 could be perfect for some trading cards. For example, we can imagine Pokémon trading cards where each card can have a different rarity and therefore a different number on the market, but also stickers, for example, from Panini, no, of footballers and maybe champions like Cristiano Ronaldo there could be few copies. and therefore increase its value and the most common players instead have a shitload of copies and therefore have a very low value and a very low rarity.

Then there are the 4907 rental NFTs. These here are all the numbers that you can find anyway at the address that is linked to you in the slides and they are rental NFTs, that is, I can and in fact it is an extension of the 721, I can eh go and create an NFT and assign it to a wallet for a pre-established time. After that predetermined time there, that NFT is no longer owned by that wallet. It could be, for example, a now I'm expanding for a moment, but eh the NFT no lectern could be used for hotel keys. If I wanted to go to a hotel and I had an NFT, I could relax and read a QR code that identifies an NFT and I could open my hotel room without having to check in.

Why not? Because I could have the NFT inside my wallet on MetaMask, on my mobile phone and when I interact with the door the door could ask me for a challenge, therefore the signature to verify that I am the owner of that wallet, so I didn't just show the QR code, but that I am the owner, so I have to go and sign it with my private key. To do this, obviously it requires a special lock, but if someone developed it it could allow automatic check-in, so no longer a person who is or maybe even outside the hotel, so no longer a person who is necessarily at the reception desk waiting even at night and and then we have the Salban tokens which are non- transferable NFTs, perfect for certifications. Well, I'm starting to take a course, and at the end of the course, whether I have to take an exam or not, they might give me a certification. This certification here could be a salvan token.

I could have given him my wallet, my address and through a challenge I could associate the certification with my wallet. My wallet could become a CV, for example, for a university student it could become, eh, it could be a student record book for university, precisely. And then there are the 998 which is actually not a draft, it is not an official standard yet , which are NFTs that can own other NFTs. Personally, I haven't found a use for it, I'll leave your imagination to you , but I liked it when I went to see the various types of NFTs in the list and I wanted to add it. Here I'm going back to what I said before.

NFTs are essentially certifications. I talk about NFTs as certification, but in reality any transaction on the blockchain is a certification. Even if I send money to someone, I am certifying through a transaction that I sent money. So, um, I wanted to associate it more with NFTs because we're talking about NFTs, but in reality digital authenticity can happen with any type of smart contract. Anyone can create a smart contract that generates one of the transactions and can then generate digital authenticity via a digital certificate.

The use cases are many. ISO 9001 certifications for quality 27.001 For example, I am an IT professional, 27001 for cybersecurity, transparency in the supply chain, logistics is increasingly using blockchain and NFTs can be one of these tools that can be used. Then I was talking about school certificates, a student's school record. Votes can be released via NFT or an academic path then left via NFT collections.

Degree certificates, expiring certification . First of all, the 4907 rental NFTs we saw can be used to create expiring certifications, that is, as long as that NFT is valid in my wallet, that certificate can be considered valid. fire safety, the Ape certification on job training, for example, no, which are valid for 2-4 years or which require further updating. I had an argument with a notary here once, about deeds and notarial deeds. Let's imagine if the land registry were entirely made up of cadastral cells.

In NFT format, buying a house would become much simpler, a notary would no longer be needed . I argued with him because obviously the notary doesn't want to lose his job and especially his access to professional registers. Let's think about the registers of doctors, journalists, well these are the first two that come to mind, but that of engineers, for example, just as there is access there can also be a way to be removed from that register. There are sentences that can expel doctors, journalists, engineers, they can expel lawyers, eh. With NFTs you can give or take away access to the album.

He continues to make mistakes here too with NFTs used for professional Belgian security. If someone works, for example, for a company, the Belge could be an NFT, so maybe we avoid printing those plastic cards that we carry around with us, but it can be used on the smartphone via your MetaMask account. And the key, as I was telling you before, is either for hotels or for shared spaces, coworking, hotels, apartments. I came here to Naples to an apartment, someone had to give me the keys, but there might be a special lock to release the NFT, so Booking could work on that. Concert tickets, you got here by purchasing an NFT on Moongate.

and verifiable resumes, as I always told you before, this makes sense because for me in terms of professional training, NFTs are truly the death of them. And then I also worked for the public administration for a system called Rentry in the past and I learned a lot about protocolization and one of the things I always wondered was why they didn't use blockchain. Record keeping is the writing of data, of information, into a register that is public, publicly accessible, and dated, and is therefore certified by third- party software that certifies its writing. In the case of blockchain, you don't need to trust third parties—in this case, the public administration, okay—but you still have to trust third parties. You have a guaranteed temporal order, you have a public ledger because, as I was saying before, if there isn't a block explorer that allows you to see what's happening inside the blockchain, you can ask the nodes, which may be a little more difficult, you know, for those who aren't IT professionals.

and above all the immutability of the data. It is not possible to modify or delete existing data. Actually, someone here might tell me that this isn't entirely true, because we know that, for example, the birth of Ethereum Classic was born precisely from an Etherium revert, but if you go and look at Ethereum Classic, it still remains history. There is always a hole where history remains and above all it does not happen often. It's not an event that has happened so frequently that it undermines this technology.

So we can say that every transaction is an event because, as I told you before, it is an association between data and its recording date. It is immutable, even chronologically, and publicly verifiable, which is exactly the definition of a digital record system. It certainly has an additional cost because we know that transactions have a cost, so it certainly has an additional cost but this cost is dictated by the trust that can be had in this system. Etherium, like Bitcoin, like Polygon, are designed to be trustless systems, but this brings trust in those systems to its advantage, because everything is public, everything is verifiable and above all there is a set of nodes that is difficult to attack, difficult to corrupt. It is difficult even with Per Polygon, which has many fewer nodes than a line like Ethereum, like Bitcoin, to attack it because it would be very expensive and above all it would not be counterproductive.

Here we move on to the part relating to products and traceability. There is one, eh. So, let's start with the definition. a product, a digital product password, which falls within the new European regulations that, as you can see, have already come into force in July 2024. They require three main points: a unique identifier that identifies the product, and then various information such as the composition of the materials, the origin of the materials, the instructions for use, the repairability, disposal, and shelf life, which precisely identify the properties of the product.

That is, from a shirt I could later send it to the wastepaper basket and produce new, new fabric, new shirts, especially for example in cotton, but also for example for less natural fabrics such as polyester which is mainly plastic. The whole thing is expected to work via QR code, NFC and RFID. These are the various technologies that we all know. Today we had to show that code to enter the event. We use NFC, RFID, and NFC to pay with Apple Pay and Google Pay using our phones.

So they are all systems that we already know and already use. The main objective, well, I put this photo here of the plastic tables precisely because the main objective is to try to move towards a more environmentalist idea, a more sustainable production. Transparency must be complete throughout the value chain. Traceability for consumers and business authorities allows consumers, above all, to have a superior quality product, they can verify and be sure that the product is made up of the ingredients or components they see inside the QR code or on their phone. It supports circularity through the possibility, as I said before, of recycling materials, of being able to repair them if they are repairable, of being able to reuse them, it has not also put in place the possibility of knowing how to dispose of them.

There are some materials that cannot be disposed of in a simple way. Many companies talk about greenwashing every now and then when some companies give an environmentalist idea, they show that they do, they do, the traceability of products, they try to be more transparent, but then in reality they don't do any of this and the blockchain allows precisely this, let 's say the European regulation allows precisely this, it should allow precisely this, to go and counteract this greenwashing through certificates and through measurable data on the certificates. Blockchain is precisely its ability to be able to insert data that can be measured and therefore certified. One thing I haven't told you is that on blockchain there is no verifiability of the data, so it's obvious that if the data is written fraudulently there is still an irregularity in this, but what the end consumer gets is the certification that the data was written correctly. This regulation came into force in July 2024, so it is already in force for a specific list of categories, including those you see there, textiles, toys, building materials, electronic drums and there are many European projects on textiles, for example, especially in the Horizon 2020 project.

I had reached the end of the presentation. However, what I wanted to try to bring to this presentation is precisely the possibility of seeing the bloccin as a support for all those that can be processes within a company that can be from the traceability of the product, therefore from its origin, up to the sale of the eh of the product. I leave you, I hope this presentation was useful to you . My contact information is there; if you need me, I'm available both via email and on LinkedIn. Thank you.