The Digital Fashion Industry 👘💻

The Revolution will be Accessorized

Accelerated Capital is a weekly publication exploring how cryptoassets, DeFi, virtual reality, and other exponential technologies are transforming our economy, society, and culture.

Table of Contents 🕹️

  1. Introduction

  2. The Fabricant

  3. MetaFactory

  4. RTFKT


  6. The Expression Engine

“Fashion is a language that creates itself in clothes to interpret reality.”

- Karl Lagerfeld

I. Introduction 👾

The advent of mixed reality and web3 technologies are combining with traditional industries, such as gaming and fashion, to create entirely new virtual worlds. The acceleration of technology and the growth of entertainment as a medium has transformed our society markedly from 20 years ago. In another 20 years, it will be unrecognizable. However, it is easy enough to follow the trends, one of which being the emergence of a Metaverse that we will increasingly spend time in.

As discussed in our issue last week, our digital representations are becoming increasingly important as we seek ways to express ourselves in virtual environments. This trend is visible today in the video game industry. For example, Fortnite disclosed in 2018 that 59.8% of their $2.4 billion in revenue came directly from cosmetic avatar skins. Virtual good sales currently exceed $50 billion per year in revenue and are growing.

When we broaden this out, fashion itself is a $3 trillion industry dedicated to individual expression. As 3D technologies grow in application and scale, it is likely we see the fashion industry embrace these digital spaces.

Digital fashion is not entirely new. It has been hovering around the margins of the industry for some time. For example, Moschino has released a collection inspired by The Sims that was subsequently released in-game. Gucci collaborated with The North Face to create clothes to be worn by a player’s avatar in Pokemon Go. Nike partnered with Fortnite to drop their iconic Jordan sneakers in-game. Marc Jacobs designed 6 outfits for Animal Crossing: New Horizons.

A tumultuous 2020 has accelerated this trend. Revenues for industries that rely on physical presence for events declined substantially, prompting many businesses to look at their digital footprint as a way of meeting the consumer where they are. Fashion houses were no exception as they too sought a reprieve from cancelled events and declining revenues by exploring mixed reality technologies. This trend appears to be here to stay: Balenciaga’s Fall ‘21 fashion show, Afterworld: The Age of Tomorrow, will have a video game theme.

In this issue, we discuss some of the major fashion houses, brand incubators, and platforms that are enabling a shift to digital-only and/or digi-physical fashion apparel.

II. The Fabricant 👾

As a company of creative technologists we envision a future where fashion transcends the physical body, and our digital identities permeate daily life to become the new reality.

-The Fabricant

The Fabricant is a fashion house paving the way forward for digital-only clothing. Using photo-realistic 3D design and animation, The Fabricant produces clothing and experiences at the intersection of technology and fashion.

The Fabricant’s mission is to vastly reduce the fashion industry’s impact on the environment by using an ‘always digital, never physical’ approach. According to research in collaboration with Imperial College London, the life cycle of physical fashion production is environmentally intensive:

  • The life cycle carbon footprint of the production of a single t-shirt, from design to disposal, generates 7.8 kg of CO2. A digital-only t-shirt generates 0.26 kg: a reduction of more than 97 percent in carbon impact.

  • Wetting processes during the life cycle of a t-shirt amount to 683 litres of water consumption - a digital-only product skips this phase step entirely.

  • Environmental pollution caused by the use of chemicals in the physical design and production phase amounts to 12,300 kg. Digital-only generates 0.692 kg.

  • Digital samples replacing physical garments during design and development phases dramatically reduce the brand’s carbon footprint by up to 30% and help to achieve sustainability goals.

While digital samples are the most immediate use case, the ultimate vision is to extend to entirely digital-only clothing. Mixed reality technologies can make this vision a possibility. The purchase of digital clothing oftentimes comes with AR filters for Snapchat, Instagram, etc. Alternatively, purchases can be “fitted” to an individual’s photos and videos using CGI animation. The most exciting eventuality is digital-only clothing for avatars in VR.

The Fabricant was an early adopter of blockchain technologies. In 2019, they partnered with Dapper Labs, creators of CryptoKitties and NBA Top Shot, to create ‘Iridescence’, the first digital garment to sell on the blockchain as an NFT. The Creative Director Amber Jae Slooten wrote the following to describe this event:

A new cult is rising. The digital world is coming and we are no longer bound to physical space.

Our bodies are becoming fluid, our money decentralized, new powers are being formed. Slowly we are moving into a non-dual operating system. Intrinsic new patterns are being formed by systems that are closer to our nature by evolving rather than being controlled by a central power. This outfit provides a look into the future.

One area of focus for The Fabricant has been on ‘phygital’ experiences. A recent partnership with Hong Kong-based luxury fashion retailer I.T saw The Fabricant being commissioned to digitally recreate a line of clothing for the retailer that celebrated three decades at the helm of Chinese fashion.

As part of this partnership, I.T established pop-up boutiques that featured zero physical apparel. Using augmented reality technology, customers were able to virtually try on these clothes at the pop-ups and place orders via an app.

III. MetaFactory 👾

MetaFactory sits at the intersection of community, culture and finance. It is the bridge through which online experiences and identities connect to the physical world via unique apparel and brand experiences that are designed, curated and owned by the community.

MetaFactory is a decentralized autonomous organization (DAO) that crowdfunds the creation of community-owned fashion brands. MetaFactory is a cultural engine, facilitating the development of new products by abstracting away the logistics. This allows creators to focus on their craft while the DAO handles creation, fulfillment, sales, and support.

MetaFactory uses a governance token ($ROBOT) to manage partnerships, platform features, the community treasury, and more. $ROBOT is the economic fuel for the ecosystem. It is used to pay creators, reward buyers through a cash back program (currently 42% back on each purchase), and to curate the marketplace.

MetaFactory is also exploring a curation mining program, which is a crypto-economic version of conviction voting. Here’s how it works in MetaFactory’s own words:

  • Designer makes a proposal for a product drop

  • Curators can “charge” the proposal by staking their ROBOT tokens on them. The more ROBOT that gets staked, the faster it charges.

  • Once the proposal builds up enough charge, it will go into production and pre-orders/sales will open.

  • Curators who staked on that product will get X ROBOT per dollar sold, proportional to how much “charge” they contributed.

This novel approach empowers the community to control the product pipeline while simultaneously generating culture from the bottom up.

Whereas The Fabricant utilizes a digital-only approach, the MetaFactory straddles the digital and physical realms. Each piece of their signature line (four drops so far) includes a unique silicon chip that tracks the specific order number of the product and its associated metadata. This allows you to link it to an on-chain NFT that doubles as a unique wearable in a virtual world like Cryptovoxels. Customers then are able to match their physical clothing with their virtual avatar, enabling a new form of Metaverse expression. They are hoping to expand this in the future to more products as well.

MetaFactory has had a number of high profile drops from other crypto projects, such as $YFI, $SUSHI, $MEME, $YAM, MetaGame, and more. There is an active call for communities interested in branded apparel and merchandise to get in touch.


RTFKT combines augmented reality, blockchain technology, and video game engines to create sneakers and digital artifacts for the Metaverse.

Although the group had worked with game designers and fashion brands behind the scenes for some years prior, RTFKT was officially founded in January 2020. It has since evolved into a full-fledged fashion house, generating millions of dollars of revenue and locking down major partnerships with FEWOCiOUS, Atari, the A.I. robot rapper Meka, and more.

RTFKT’s digital wearable NFTs are designed to be interoperable across the virtual worlds, including Decentraland, Cryptovoxels, and the Sandbox. In addition, purchases come with custom augmented reality filters for apps such as Snapchat, Instagram, and more. Collaborations with video game engines will also enable in-game avatars to sport the items as well.

RTFKT is most well-known for their sneaker designs. Their partnership with FEWOCiOUS, an 18-year old artist leading the cultural shift to digital art and NFTs, saw three styles of shoes produce $3.1 million of sales within 7 minutes of the drop. Prior to the sale, potential customers were able to virtually try-on the shoes using a SnapChat filter. Each purchase came with a virtual sneaker and could be redeemed for a physical pair.

Following the drop, RTFKT’s founders were quoted by HypeBeast as saying:

We wanted to show people the future, and we made it happen. This collab is the result of a perfect alignment of all the culture we love and know.

We believe this is the start of a new revolution.


One of the largest challenges for the digital fashion industry is creating interoperability standards so that pieces can be easily ported to different platforms within the media layer (e.g. gaming, VR, and other 3D environments). DIGITALAX’s goal is to create this architecture by becoming a distribution channel and content supply chain on Ethereum. In other words, DIGITALAX wants to become the Digital Fashion Operating System (DFOS) for the Metaverse.

The DFOS is comprised of three layers:

  1. Authenticated and Tracked Digital Content Supply Chain - This layer is native to the Ethereum blockchain, relying on Ethereum infrastructure such as NFTs. DIGITALAX uses the ERC-998 standard, which allows for the ERC-721 master token to hold a balance of ERC-1155 tokens. This means creators can design NFTs for each layer of the digital item. For example, there would be a child ERC-1155 NFT for the material, pattern, texture, and more. Creators are able to monetize fashion elements by receiving royalties from their modular designs.

  2. File Format Logic - As discussed above, file format discrepancies are one of the largest challenges for application interoperability. For example, an object that is typically rendered in a high-fidelity environment might not be able to output to lower polycount environments. The DFOS uses a conceptually similar process to wrapped ETH to convert 3D files across distinct modelling, animation, and game engines.

  3. Digital Economy Ecosystem - This layer is where the digital economy is formed. Rather than a top-down, developer-to-consumer approach, DFOS attempts to bridge the market into a more integrated system. Player demand drives content creation by designers that are then integrated into games via developers. Since developers are freed up from digital fashion DLCs for player avatars, they are able to focus on virtual world and experience generation. Designers are able to quickly react to player content demands through modular NFTs. Brands can ship directly to players without the digital pieces being limited to specific environments. And, most importantly, players are able to express themselves via a digital identity by customizing it within an interoperable multiverse.

The entire DFOS utilizes an ERC-20 token ($MONA) as gas while also tying it to value generation. For example, game designers can integrate the token as in-game currency or rewards.

Interestingly, DIGITALAX is also building out an Esports platform called ESPA. The ESPA platform brings together developers, modders, designers, and casual gamers into a play-to-earn experience built around fashion. It’ll be interesting to see how the gamification of wearables plays out.

VI. The Expression Engine 👾

Hyperrealistic VR and AR graphics are creating entirely new business models. For example, companies like RedFOX (a constituent of the Metaverse Index) are exploring digital shopping malls, which are 3D immersive virtual storefronts filled with digital items that sometimes come with a physical counterpart.

Blockchain technologies enable authentication of each piece, which has historically been difficult for the fashion industry. But rather than just providing an authentication service, cryptoassets can truly bring the fashion industry online, capturing a unique direct-to-avatar revenue stream.

While it is admittedly early for some of the tech and cultural norms to saturate our experience, it isn’t difficult to imagine this is on the horizon. Brands and fashion houses that embrace this trend sooner rather later, like the companies above, are positioning themselves for fashion 3.0.

Frequent readers of Accelerated Capital likely understand by now that the merging of a variety of technologies are accelerating a shift into the Metaverse. This shift requires humans to have the ability to express themselves, and what better way than fashion. Ffortunately, mixed reality tech opens up a whole world of creative possibilities.

Who will you be wearing in the Metaverse?

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