What is it about RTFKT's products that makes people willing to spend nearly $5,000 on a pair of shoes that they can't touch or wear?

In February, RTFKT teamed up with 18-year-old cryptographic artist Fewocious to release three virtual sneakers in the form of NFT, priced at $3,000, $5,000, and $10,000, which buyers can pay for in cryptocurrencies like Ethereum. The 621 pairs of shoes sold out within seven minutes of going online for a whopping $3.1 million, or an average of $4,992 per pair.

RTFKT has also hired two former employees of Clarks, the British fashion shoe brand, to make a batch of physical shoes in the shape of virtual shoes for buyers, which it plans to distribute in April. It sounds crazy enough that most of the value of the nearly $5,000 average sale price comes from the virtual shoe, even though it comes with a physical shoe.

In recent years, the shoe speculation craze has become more and more popular, with high resale prices prompting many people to become shoe dealers and even stockpile goods through apps such as "shoe-snatching robot". Cowen, an investment bank, estimates that the global sneaker resale business is now worth $8 billion and could grow to $30 billion by 2030.

The NFT market, on the other hand, exploded in 2020, with the NFT market growing from $41 million to $338 million between 2018 and 2020, according to blockchain data site NonFungible. And looking at 2021, the NFT market continues to gain momentum.

As for the combination of sneaker and NFT, the popularity and the price at which it changes hands is more than most people expected:

In late 2020, Whale Shark, a well-known NFT collector, bought "The X Evolutions", a pair of NFT sneakers designed by RTFKT, for 22 Ethereum coins (worth more than $13,000 at The time);

During the Lunar New Year this year, RTFKT Studio auctioned a pair of solid gold virtual sneakers through the Digital Asset Exchange Treasureland, and the final price was $28,000.

RTFKT Studio currently designs and builds virtual products such as sneakers and jackets through NFT and AR technologies. They also hold a monthly sneaker auction on their website, where participants bid in cryptocurrency and the winning bidder can display their collection on social media platforms like Snapchat and Instagram using a special AR filter.

In fact, RTFKT has grown by Posting images and other content on social media platforms such as Snapchat and Instagram.

In April 2019, Benoit Pagotto, Steven Vassilev, Chris Le and others began Posting through Studio RTFKT's Instagram account. Despite the fact that the content is mostly processed images, these images are cool enough to help RTFKT quickly build a fan base.

In early 2020, they posted a manufactured image of Elon Musk attending the 2018 Metropolitan Museum of Art Gala in New York, and it quickly went viral. In that image, RTFKT created and "put on" a cyberpunk shoe inspired by Tesla's electric "CyberTruck." Despite the fact that it was a manufactured image, many people asked where they could get the shoes after the image was posted, with one offering to pay $40,000 for the pair.

The popularity also gave the three founders more confidence, and in January 2020, they decided to officially launch RTFKT. "When we started, we turned some people down because we thought it would become a brand." Pagotto said in an interview with the British media Hero.

In addition to virtual sneakers, virtual clothing is also in vogue. Filip Vajda and Marija Vrbanic started Tribute, a virtual fashion brand, during the epidemic. Customers can choose the clothes and accessories they want and provide a photo of Tribute, which uses CGI technology to photoshop the items onto the photo provided by the customer.

"We didn't really have any expectations for it, we just put it on Instagram and see how people reacted. But after those photos were published, we were approached to design the clothes, which was quite unexpected." "Forbanich told The Tech Platform.

For Mr. Forbanich, the success of Tribute has something to do with Gen Z consumers. Generation Z consumers have grown up with fashion and video games, and they're more comfortable with those things.

The same logic is behind RTFKT's popularity. Whether it's sneakers or NFT forms, young consumers are curious enough to chase these trendy, cool new things.

At the same time, in response to the curiosity of the young consumer group, the future shoe design may be more imaginative, especially the virtual shoe can also be free of the constraints of the production process. RTFKT Studio can also start with physical shoes, with some super limited, special color shoes in the form of virtual shoes, to meet the sneaker fans' desire to collect, but this needs to be authorized by the sports brands.

For sports brands, the uniqueness and unrepeatability of NFT may be more important than the virtual shoe.

In 2019, Nike filed a patent for its NFT sneaker identification system called Cryptokicks. After consumers buy a pair of sneakers, they can generate an avatar and crypto token on Cryptokicks, which can also be traded, providing an additional layer of security for secondary market circulation. If this technology can be applied on a large scale, the appraisal function and business of the shoe appraisal platform may encounter great impact.

It's worth mentioning that in addition to making money from products such as virtual sneakers, there are already a number of brands that are willing to collaborate with RTFKT Studio to release co-branded products:

Lexus teamed up with RTFKT Studio to design a 'co-branded shoe' that incorporates elements of Lexus's new sports sedan into a sneaker;

Atari and RTFKT Studio are planning to create a new line of NFT fashion shoes based on Atari's games, and only sell 50 pairs of shoes each.

Case manufacturer NZXT teamed up with RTFKT Studio to create a pair of shoes that "come with" the RTX 3080 graphics card, cooling fan and screen.

From sneakerheads to brands, the frenzy for NFT and sneakers is not only driving up collection values, it is also creating bubbles that no one knows when they will burst. "As more and more companies come in, the bubble will last longer. But when the bubble burst, many people didn't have time to buy and were left with digital collections that didn't make sense." "Said CoinDesk reporter Ollie Leech in an interview with Input Mag.

On the other hand, as more and more athletes benefit from the NFT collection, professional leagues, agencies and sports brands may need to keep up with The Times and specify details such as release rights and profit sharing in their contracts.

With the rise of emerging technologies, the shoe, co-branding, endorsement and other fields will inevitably face new opportunities and challenges. RTFKT studio launched the virtual shoes, in fact, is to provide consumers with a brand new shoes and use experience.

Just, when a pair of sneaker evolves from consumable goods to futures, collection step by step, go more and more toward "cannot wear" direction development, is such really good?