Welcome to This Week in the Metaverse, where Fortune rounds up the hottest news in NFTs, culture, and virtual worlds. E-mail [email protected] with tips.

As Coinbase battles with Gary Gensler and the Securities and Exchange Commission, the IRS is taking over NFTs.

In a statement released Tuesday, the Internal Revenue Service said it was considering taxing NFTs like other collectibles, including gems or works of art. This is the agency’s first attempt to define how NFTs should be taxed – collectibles are taxed at a higher rate than other assets if sold after a year – and its impact could ripple across the industry.

The agency is asking for comments from the public until June 19.

Elsewhere, companies are still laying the groundwork for adopting NFT technology. PlayStation maker Sony recently filed a patent protecting its rights to create NFTs that can be transferred between games and consoles, a key interoperability mechanism that could fuel adoption of the technology in the gaming industry.

The patent also opened the door for the propagation of NFTs from one console generation to the next, for example from the PS4 to the PS5 or between Sony’s devices and a competitor. It also referenced the potential uses of NFTs in esports, adding, according to CoinDesk, “In some exemplary embodiments, the task may involve a win in a sports tournament and the digital asset may be used via the NFT by the first end-user entity across multiple different computer simulations.” .”

Finally, with rumors of impeachment circulating for former president and current candidate Donald Trump, the reserve price of the NFT collection he supports has skyrocketed.

The collection, which has been derided for its raw art, has risen by double digits to a price floor of 0.5 eth, or about $883, on NFT marketplace OpenSea, up from 0.3 eth, or about $530, in the last week.

companies in the spotlight

Traditionally, one of the key issues with mass adoption of Web3 technology has been onboarding, but a new startup, Redeem, is trying to change that by leveraging something we use every day: our phone numbers.

Instead of going through a complicated process to set up a crypto wallet, Redeem automatically creates it for users. Imagine a festival where the organizers give away a free NFT. Even if participants have no Web3 experience, all they have to do is scan a QR code, send an SMS to verify their phone number, and Redeem will automatically create a polygon wallet linked to their phone number and deposit the NFT. The company also allows users to link other types of existing wallets.

Founder and CEO Toby Rush said this technology could be transformative for companies looking to give away digital collectibles or integrate NFT token gating into events.

“There is no app to download. There is no form to fill out. So if you can literally click a link and hit submit, that’s it,” Rush said wealth.

When I tried Redeem’s technology myself, it took less than a minute from scanning a QR code to receiving a sample NFT in a new wallet, which was featured on NFT marketplace Rarible. When I added a second NFT via the demo on Redeem’s website, I repeated the process of scanning a QR code, but this time for a sample token gated ticket. Redeem immediately recognized that I already had an account tied to my phone number and put the new NFT in the same crypto wallet.

In other news

Pace Verso, the Web3 hub of New York City-based Pace Gallery and generative AI platform Art Blocks, announced three new NFT projects by artists Trevor Paglen, Maya Lin and John Gerrard. The projects are offered for sale on artblocks.io and sold through Dutch auctions. One of Paglen’s pieces is an interactive and experimental NFT series in which Paglen has hidden Easter Eggs for collectors to discover, decode, and use in other parts of his project. Collectors who find them will receive a free limited edition vinyl LP of Paglen’s related speculative reality work entitled CYCLOPS and a gelatin silver print by the artist.

Trevor Paglen, PRELUDES, Mint #0 of 250 Unique NFTs © Trevor Paglen, courtesy of Pace Verso and Art Blocks

Courtesy Pace Verso and Art Blocks

Supermodel and entrepreneur Karlie Kloss has teamed up with Roblox to launch a new experience in the digital world called FASHION KLOSSETTE. In the game, users in the fashion industry can work their way up from intern to editor-in-chief by designing looks to be featured on a virtual runway and in galleries. Kloss created the items with a team of talented Roblox designers, including 17-year-old developer Rush Bogin, who has advised Kloss on her Metaverse ventures, and Jenni Svoboda, who designed the Carolina Herrera Spring/Summer model’s digital floral dress 2023 runway.

Courtesy of Roblox

Magic Eden this week launched a marketplace for the ever-growing Bitcoin NFT market. Building on its current support for Solana, Ethereum and Polygon NFTs, Magic Eden’s new store will help capitalize on the 400,000 inscriptions or minted Bitcoin NFTs in existence to date. Initially, the marketplace will feature 13 collections, including Taproot Wizards, Inscribed Pepes, and Bitcoin Bandits.


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