The buzz on blockchain technology can be heard around the world these days. So, no wonder it eventually would make its way to travel.
Before we dive into those specifics and get our NFT wallets (or passports) ready, let’s back it up a few steps and talk about some basics.
What is Blockchain Technology?
First up, what is blockchain technology? At its core, blockchain is a digital ledger that stores data of any kind. It consists of records called “blocks” that are used to record the transactions.
Without getting too techie here for the sake of keeping it related to travel, imagine a blockchain a bit like your passport, or global entry pass, where all of your travel transactions have been recorded.
What are NFTs?
By definition, non-fungible tokens (NFTs) are a digital asset that is transacted and stored on the blockchain. NFTs can range from photos, videos, utility tokens, sound clips or even represent real world items, such as real estate or artwork.
They’re a piece of data that is stored within the ledger, which can run on a variety of blockchains, including the mainstage Ethereum platform, or Solana, Polygon, Tezos, Cardano, to name a few.
What makes NFTs so “special” or hold value are that they are indestructible, unique and verifiable. Indestructible, meaning, they’re stored on the blockchain and cannot be destroyed, removed or replicated.
Unique, or non-fungible, meaning they cannot be replicated and are actually owned by the buyer, and not just given the rights to usage. Verifiable, because they can be tracked back to the creator via smart contracts, which all transactions on blockchain technology are written on.
Still with me? Good. Going back to the metaphor of travel and passports, the NFTs are like your stamps you receive entering into other countries. Which, actually could be a pretty interesting NFT, now that I think of it. Let’s create and move forward!
How Does Blockchain Technology Relate to Travel?
While most NFTs are related to art, games and the growing Metaverse, there is also a growing space in NFTs for travel. Hospitality brands have caught wind and are already testing the waters.
Marriott Bonvoy launched their first NFT Collection during Art Basel Miami Beach 2021, with winners in the collection receiving a piece of art along with member points. The Dream Hollywood hotel is the first hotel to host an NFT gallery.
AirBaltic was the world’s first airline to issue NFTs, featuring a limited collection of NFTs to boost tourism in Latvia.
Of course, artists showcasing travel NFTs are also another entry point into the blockchain and tourism space.
While there is so much more we can dive into in this category of what is currently being done and what can be done, it’s important to note that it’s all still so new that it really is an open game for opportunity where one wants to take it and create with it.
What are the Current Challenges Blockchain Technology and Travel are Facing?
As with every new opportunity and technology, there are also challenges that accompany it. Regulations and standards are one side of it. However, the biggest conversation around blockchain technology and tourism is the environmental toll that NFTs have been labeled to have.
NFT “gas fees” are at a staggering high for minting on the blockchain Ethereum, giving space for many to point out the environmental harm that’s even worse than travel itself to the planet.
Back it up a step, in short, gas fees are what users must pay in order to perform any function blockchain, specifically Ethereum.
That being said, there are quite a few other options for minting NFTs that require little to no gas fees, with more options becoming available as this is a major disadvantage and concern with increasing the usage of blockchain.
The Ethereum Merge (going from proof of work to proof of stake) is set to go live during 2022, putting energy concerns to rest from environmental toll on expended energy on the current proof or work mining.
In addition to Ethereum, there are other more sustainable platforms for minting NFTs on, including Polygon, Tezos, Cardana and Aspire.
What Opportunities Lie Ahead?
While it’s still too new to map out all of the opportunities for NFTs and travel, it is safe to say that with global reach for immediate transactions, reducing the middle person (including banks) for transactions and being able to track and trace payments, making them more secure, there is certainly a base level function and role for NFTs and blockchain technology in the tourism category.
Beyond basic function, the possibilities are endless. If I were to go crazy with my blockchain imaginative mind, visualize buying a membership in cryptocurrency to attend your next retreat via an NFT token that grants you access where you can dip in and out of any resort within a resort brand or airline alliance around the world?
Or, checking out of your New York office to take a lunch break in Thailand joining in on a meditation session in the Metaverse after a yoga session in Spain? All within the hour. Yes, I see that as a possibility… some day.
A lot to pour into one article, but if you take anything from all of this tech and travel newness, understand on a high-level what are NFTs and blockchain technology, and the many potential opportunities that lie ahead within the travel sector that you can keep an eye out for, and experience.
Let’s open the conversation: what have you heard so far about NFTs, or blockchain? Have you seen any instances in the travel sector yet in your searches or adventures?