Phygitals: The Case for Connecting NFTs to Consumer Items - Lacie Thorne

hi everybody i'm lacey nice to meet you all um my background is not in tech my background is actually in fast fashion so i'm here today to kind of talk to you guys about the opportunity to reduce carbon emissions reduce carbon emissions associated with uh the global production of the fashion industry sure sure sorry i like to wander um so yeah i'll just start over i'm lacey my background is not in tech i am uh from the fast fashion industry and i have kind of kind of come up with a concept that will help fashion companies reduce their carbon output associated with the production of fast fashion items so i'll talk to you guys a little bit about it today okay uh so when i first started my journey in fast fashion i kind of fell into a niche of celebrity clothing design as you do i launched a clothing brand for jennifer lopez for kohl's which was the largest celebrity licensing partnership in history it was very glamorous i followed that up with launching clothing lines for jennifer lopez adam levine and then nicki minaj and so all of those were big box stores like kohl's sears kmart so i would go over to the fashion uh office in new york and then fly out to the celebrities homes and i would go into their closets and talk about the aesthetic of the line and then bring that information back to the new york design office but then ultimately oversee the manufacturing in mainland china so the very glamorous experience were kind of juxtaposed with uh witnessing the reality of making these huge orders of clothing and i remember being in the factory and witnessing like 60 000 units of neon pink genes being manufactured and all of the resources that were going into creating these genes growing the cotton transporting it dying it putting it all together with the human capital um shipping it across the world people were going to wear these jeans like one time and then throw them away right they were like 19 they weren't great quality and then they were going to end up in a landfill right so when we think about the industrial apparel industry we oftentimes tend to think about it in terms of our own closet when we think about it globally it's a huge environmental issue and so from the fast fashion industry we ultimately end up with these huge deserts of wasted fashion even if you end up you know donating your clothing there's such a surplus of fast fashion clothing that they get exported to countries they try to sell it but then there's such a surplus from there that we end up with literally deserts and mountains of fast fashion clothing and because these are you know poly based clothing they don't degrade they don't biodegrade ever hardly and as the fashion industry continues to grow this is becoming more and more of an issue so i kind of started to feel a little bit like more of the problem than the solution and ultimately transitioned my career from fast fashion in new york to luxury fashion in hong kong and i lived in hong kong for five years and i started working with brands where the clothing was not meant to be thrown away but ultimately like who can who can afford an entire closet full of designer clothing nor maybe would you even want to right so when i moved back to america i enrolled in yale school of management i'm in their sustainability program and i came up with an idea for a sustainable fashion approach so it has to be consumer demanded consumers have to want it it has to be affordable it has to be ethically sourced and environmentally responsible so around that same time i started learning about the crypto industry learning about nfts and ultimately came up with a concept that basically combines board app club and poshmark so i was reading in rolling stone magazine this is kind of where the inspiration for the idea came from and i'd really love to hear your feedback on this at the end of the presentation so right now music bands are releasing their albums as nfts on the blockchain and when that nft gets sold a royalty commission goes back to the music band every time it gets sold and i thought what would happen if we did that with individual items of clothing so the manufacturer can put a code and we'll talk about like the sensors here in a minute and you can not only you know track the authentication of the individual item but then when that item gets sold on like a white label resale marketplace every time it gets sold a royalty commission goes back to the manufacturer in order to incentivize them to create items that last beyond the first generation user so the good news here is that the second hand marketplace already is growing exponentially you know we see second-hand marketplaces like poshmark threadup d-pop ebay the real real all of these platforms are just exploding in growth so at the manufacturing source say i'm wearing like a j crew sweater if there was some way to put a sensor on that whether it's like a qr code an rfid code there's all kinds of cool sensors that are happening you can put bioluminescent fibers inside of fabric now from a plastic standpoint they're doing chemical tracers so you can tap that individual item and unlock the nft associated with the item so what happens from there is the brand puts the chip on the clothing the consumer purchases that item scans the item and unlocks the nft associated with it and when they're ready to resell that item that nft kicks back a royalty commission not only to the brand but to every person that's ever owned that item so it incentivizes from a monetary perspective to for brands to create items that last beyond the first generation user but then it incentivizes the consumers to not only adopt the technology but take care of the item and sell the item to other people who are then going to move it down the line so there's four main benefits of this concept one is the smart contract enabled trail commissions two there's an opportunity with a company that i'm working with now called real items where you can actually add memories to your nft so say i'm you know in paris and i'm wearing this sweater or i'm michelle obama and i'm wearing this sweater there's opportunities through the experience of the item to actually add value to the item but then also when i unlock the nft associated with it there's some consumer market intelligence from a data perspective that the brand gets a benefit from as well and if there's a token associated with that nft there's some tokenomics that are get really interesting that we can talk about so all of a sudden your closet is not a room full of depreciating assets but effectively you can stake the items in your closet to earn yield and receive tokens and then be able to not only use those tokens for resale when you sell the item but you can also use that yield from a liquidity standpoint to buy additional used items in the marketplace so when we start attaching nfts to physical items on the blockchain there's all kinds of really interesting use cases for that so one is obviously the incentivized consumer behavior from an ownership lineage and that really kind of benefits this concept of circular business models right so i wear a shirt i'm done with it i pass it along pass it along pass it along and every time i do that i receive kickbacks from the token but it also authenticates items right there's an opportunity for me to buy a luxury handbag and scan it in you can also authenticate supply chain transparency so say you are a plastics vendor and you put a lot of money and effort into reclaiming ocean plastic but then that supply chain has to go through multiple different stakeholders you're able to actually add in a chemical tracer to the plastic that at every point in that recycling process you can effectively create a dowel that moves the nft along the supply chain to when it finally gets into your plastic sunglasses it is verified that you it was the same ocean plastic that was reclaimed we started kind of talking to corporations about some of this opportunity and i know that earlier we talked a little bit about esg incentivization from corporate governance structure a lot of this can really help with verifying data associated with esg initiatives as well as like the material materiality assessments um and really tracking those key esg metrics from a data perspective and we also see a lot of opportunity in aerospace and defense there's a an executive order coming out that initiates sustainable measures from the government as well so during my process of research i found this company called rail items and they have been kind of moving in parallel from a thought process of connecting physical items to the blockchain through nfts and like everyone else here we are hiring looking for all kinds of positions so i know that as developers you guys have incredible opportunities to shake the money tree basically but i think that there's an opportunity here from an esg perspective to really lower the carbon emissions associated with the fashion industry but not only the fashion industry because if you can connect a physical item to an nft you can do this with anything you can do it with books you can do it with video game systems you can do it with jewelry you can do it with power tools anything that tends to have a consumer life cycle if there's an opportunity to connect an nft to it there's an opportunity to incentivize the resale process and keep that consumer good out of a landfill so i would love to be able to chat with anybody who's able to kind of poke holes in this idea to be able to help me understand the technology behind this idea a little bit more i know that there's some opportunities from solidity smart contracts but overall i think if anybody has any questions i would love to hear them