Token gating is based on the idea that anyone possessing a token can enter a restricted area. Both fungibility and non-fungibility are possible for tokens. Having the appropriate fungible or non-fungible token in your wallet will enable you access. Members of the community can create value for themselves using token gating. Discord channels restricted to NFT holders are a typical example of how a token gate can be used, but this is by no means the only possibility.
Non-Fungible Tokens (NFTs) are digital assets that cannot be converted into fiat currency or other NFTs. NFTs have a worth all their own, similar to a work of art or sculpture. Using NFT and Blockchain technologies, artists can generate a digital certificate to advertise their art studio’s one-of-a-kind services. Since NFTs aren’t tied to any specific medium, they can be affixed to anything from paper to video.
Fungible vs. non-fungible Token-gating
Many public blockchain projects use tokens as incentives or verification mechanisms for community participation and voting. To become a member and be eligible to vote, you must accumulate a particular number of tokens and hold on to them for a predetermined time. In addition to being more aesthetically pleasing, the value of NFTs is still being determined. To access the NFT community and participate in elections, you must own an NFT membership rather than fiat currency. NFTs, like baseball or Pokemon cards, can increase in value and scarcity over time due to their unique qualities.
NFT Token gating for Retail
Token-gated NFT is problematic when it’s used dubiously, such as when only NFT holders can buy a particular product. To verify your NFT membership during checkout, you’ll need to enter your NFT address. You’ll be ready to check out if you make it through this. NFT holders will get access to exclusive events and goods. Brands can be signed up with NFTs.
Supply chain entry using NFT tokens
The success of the supply chain hinges on the free and unhindered flow of information. Blockchain makes it possible for all parties involved in a supply chain—from manufacturers to retailers to customers—to have access to immutable and verifiable data. The ability to trace and verify transactions is improved as a result.
Only verified companies and professionals, such as manufacturers and distributors, are granted access to the supply chain through the NFT token gating. This system can also help eliminate the grey market and counterfeiting.
The NFT recipient’s address must also be entered for verification purposes. Token gating can be used to tokenize digital or physical proof of ownership, including photos of commodities, electronic bills of lading (eBLs), and supplier certifications and qualifications.
Additional Real-World Examples
NFT token gating is advantageous since it may be utilized as a credential in any market. You can use a protocol like Proof Of Attendance to issue NFT at events where your presence can be verified. Token gating is used in the healthcare industry to ensure that all clinical trial participants have access to NFT and can consent to lease their health records. With the NFT idea, you are the sole owner of your health records. It’s HIPAA-compliant and can fix your privacy problems.
Consider a car rental business that wants to provide its most valued clients with priority booking of luxury vehicles. The corporation can give priority access to its top customers without the trouble of a paper permit by gating their vehicles behind an NFT. The same idea can be applied to event tickets, giving patrons access to premium seating in exchange for NFT tokens; there is no way to exhaust all potential applications.