HYBE, the home of superstars BTS, is officially getting into one of 2021’s most talked-about and lucrative digital markets: NFTs.
Not only that, but it’s throwing considerable weight behind the crypto craze via a new joint venture with Korean fintech firm Dunamu, which operates a crypto exchange called, Upbit.
The strategic partnership will see HYBE acquire what Korean news site Pulse reports is 861,400 shares in Dunamu for 500 billion South Korea won (approx. $421m at current exchange rates). Dunamu meanwhile, according to a regulatory filing, will acquire 2,302,570 shares in HYBE for 700 billion South Korea won ($590m).
Coindesk reports that the shares are being exchanged ‘through a third-party allotment capital increase’, and results in HYBE acquiring a 2.5% stake in Dunamu, while Dunamu takes ownership of a 5.6% stake in HYBE.
This news comes on the same day (November 4), that HYBE published its Q3 2021 results, posting revenues of 341 billion South Korea Won ($288m), an increase of 79.5% or 151 billion South Korea Won ($127m) compared to the same quarter in 2020.
HYBE’s entrance into the NFT market via its partnership with Dunamu was unveiled today (November 4) during the 2021 HYBE Corporate Briefing with the Community, by the company’s Chairman Bang Si-hyuk, who stepped down from his role as CEO of HYBE in July.
Speaking during the event, Bang Si-hyuk said that “HYBE and Dunamu plan to develop an NFT business under a new joint venture, which will allow the artist IP-based content and products that HYBE has showcased to date to become digital assets for fans”.
Bang Si-hyu also introduced Korean crypto millionaire Song Chi-Hyung, the Chairman of Dunamu, who explained that Dunamu’s goal is to create an “industry standard for blockchain and fintech”.
Song Chi-Hyung refers to non fungible tokens (NFTs), as “the hot topic of this year’s fintech industry”.
“I think the word ‘irreplaceable’ was used in one of BTS’s songs,” he said. “Irreplaceable, meaning something that is unique and one of a kind. You can think of an NFT as an irreplaceable digital asset that can be safely and reliably verified so that anyone can trust that there is only one in the world. Such digital assets are created when specific digital content or products are given a unique value through blockchain technology.”
He added: “The fandom culture and industry itself are maturing to the level where HYBE’s artist IP-based content and products that HYBE showcases are now at a sufficient stage to be transformed into digital assets through these technologies”.
Explaining what this means in practice, Bang Si-hyuk used the example of physical collectable photo cards of HYBE artists, some of which are produced in limited quantities and therefore swapped by fans.
Collectibles such as these cards will be digitally authenticated by being minted as NFTs, and will feature interactive content like images, music, or the artists’ voices when you click on the cards.
Owners of these cards will also be able to trade and store them on HYBE’s fan community platform Weverse.
“It seems like it won’t be long before we can use digital photo cards within the platform to create a virtual space with our avatars, and fans can show such a space to each other and to the artists.”
Added Bang Si-hyuk: “We are working with Dunamu to create a way to expand the fan experience more diversely and securely, such as digitally authenticating the uniqueness of these photo cards and making them permanent, but also allowing them to be collected, exchanged, and displayed in a global fan community platform like WEVERSE.”
“It seems like it won’t be long before we can use digital photo cards within the platform to create a virtual space with our avatars, and fans can show such a space to each other and to the artists.
“In order to make this a reality, we will bring together the capabilities both companies have built up so far to introduce a new and exciting innovation to the global music and fintech industries.”Music Business Worldwide