For fashion brands, the merit of decentralized finance, or DeFi as it’s called, is difficult to perceive and navigate, although there are many potential benefits for businesses, large and small, in the area of fashion to create opportunities on this powered blockchain. I spoke with Alex Lemberg, CEO of Nimbus, an ecosystem governed by DAO that provides 16 profit streams to users on its exclusive platform, about his attitude on how engagement with DeFi can contribute to the expansion of fashion corporations around the world.
How can DeFi make an option to a fashion brand’s classic financing resources?
Here, if we are a small and medium-sized fashion company that participates in DeFi, you access financing of choice that might not be available in traditional monetary establishments due to a total list of points verified during threat assessment through banks. the bank, as an intermediary, needed to process the transactions, but may simply update it as a source of investment without authorization.
However, if a company chooses DeFi to obtain a loan, it means that that company is already a cryptocurrency, allowing it to move the budget around the world in a fast, secure, reasonable and transparent way and to greatly monitor its monetary operations. , DeFi opens the doors for corporations with higher profits to make more profits through a lending mechanism.
Fashionable profitable corporations can use the superior profits to provide direct loans to other players in the DeFi market, while also exchanging their profit streams and receiving even more profits, thus expanding the volume of their core operations. Tokens to others bring more liquidity to a company, as well as the ability to use other products and at the same time without visits to centralized entities.
Can brands interested in DeFi establish their business abroad?
When a fashion company makes the decision to move its production or expand it to another country or state, however, it does not have a credit score in that state and still wants a source of financing to cover the prices of such a movement or expansion, DeFi presents can be useful.
As there is no banking background in the new location, the company does not have to go to the local capital market, which means that it will have to go through an even more complicated procedure of obtaining a loan in its country of residence to control its external expansion and it may be that this is simply impossible. Platforms like mine can help here, as there is no definition of barriers to DeFi protocols, which means you can use the platform as an investment source to control overseas expansion prices. .
What about royalty and tax payment systems?
Fashion brands can use platforms like ours as an automatic royalty payment formula for designers, meaning designers who have created a design can create a locked NFT token under their call and get automatic royalties paid for their design used through a fashion brand. Along with this, it’s imaginable to use platforms like ours as a prepaid formula for limited edition collectible shoes.
For such applications, a key capability of blockchain generation is smart contracts. Smart contracts are self-executing systems stored on a distributed ledger that execute invoices or related movements when express situations are met. The contract can cause automatic payment processing when a company verifies that it has won a shipment. This would speed up the transaction and at the same time decrease the likelihood of errors in the payment processing service. These can potentially automate manual processes ranging from processing compliance and claims to distributing the contents of a will.
It can be used to automate only royalty or prepaid invoices, but also automatic tax invoices. Fashion brands can use their wise contracts to make tax bills arranged to cover such an accounting function.
Tell us how the knowledge gained by trading through DeFi can be used to gain advantages from a brand.
NFC chips are a great position to start. These chips are devices built into a product design so that the blockchain can collect, track, and organize other types of data. This data can simply be how product logistics are organized, how long it takes for a product to succeed in a store or warehouse. In addition, it can be used to track other non-public metrics such as shoes, steps, time or position of use and collect applicable big data.
This knowledge can be used to optimize production or product design and development. Along with this, it provides a competitive incentive merit for active users. create a new space, in the past not available, for companies of other sizes and types.
Can designers sell drawings in the form of NFT and collect royalties?How would a designer do it?
A designer can create a virtual representation of a design component and turn it into an NFT as a first step. Then the typing process, which is necessarily a conversion of a virtual record into a recognizable and exclusive token locked and distributed within a blockchain, such as Ethereum or Solana.
A designer would possibly need to specify the distribution situations of their token. For example, when Beeple, a prominent virtual artist, auctioned off his “Crossroads”, it was sold on the secondary market for $6. 6 million, which was a hundred times higher than the original price, Beeple earned 10% royalties on this transaction, as he included his royalty restrictions by creating a non-fungible token.
Since both a wise contract and both are necessarily code, this means that it runs when an occasion occurs, causing another occasion In our case, a designer would possibly mention in a contract (a design changed to NFT) that both once If this token is purchased, the formula or platform will have to enter a royalty and return it to the original author of the token.
Due to the fact that a blockchain uses encryption, the only limitation to restrictions within such wise contracts, such as NFTs, is the mind of the author of that contract. A designer would possibly introduce restrictions on the number of resales or uses. of your token or how long royalties will have to be refunded to the original owner of a design or even a percentage paid.
Another limitation may be only cross-platform sales, here limitations are imposed through a platform used to create a non-fungible token. In the near future, some of the situations will be customizable and independent of the technological wisdom that a user possesses. , or in our case a designer.
What about cryptocurrency instability?
Since cryptocurrencies are considered fast investments, each player in the market will have to calculate the dangers for himself. However, the Nimbus platform is generating its own solid cryptocurrency, STAN, connected 1:1 to the USD to mitigate some of the risks. dangers related to the cryptocurrency market. Lending, borrowing and participation mechanisms will be available with STAN.
If we take into consideration the case of NFTs, corporations deserve not to worry about the instability of cryptocurrency, since the maximum transactions in the NFT market are made through auctions. When a designer or corporate sells their non-fungible token, it is imaginable to exchange this source of income in fiat currency in an undeniable and fast way.
I am a lifestyle and fashion editor who writes for heritage magazines such as Harper’s Bazaar and Vogue. My specialty is fashion journalism from profiles to
I am a lifestyle and fashion editor who writes for heritage magazines such as Harper’s Bazaar and Vogue. My specialty is fashion journalism, from profiles to emerging designers and emerging markets, to the demanding situations facing the industry, fashion has been in the middle of I have also worked as a contributing editor for Harper’s Bazaar (India) and VOGUE (Russia). I grew up all over the world but was born locally, have lived and thrived in New York. for the most of my life and me London a moment at home. My favorite task is the mother of my golden mini-doodle, Aiko. Follow me on Instagram @rebeccasuhrawardi.