Lotte Home Shopping, the e-commerce arm of retail giant Lotte, launched its NFT Shop platform just over two years ago, in May 2022. The company announced on June 12 that it will cease NFT shop services on July 2.
Customers accessed the trading platform through the Lotte Home Shopping mobile app. The platform was part of Lotte’s strategy to build a metaverse platform for the future.
Use of Fiat Currency and Corporate Tie-ins
Unlike typical NFT trading platforms, NFT Shop facilitated transactions using fiat KRW, aiming to make NFTs accessible to non-crypto holders. Lotte Home Shopping also introduced its own NFT line featuring the corporate character Bellygom to attract users.
Lotte Home Shopping collaborated with Daehong Communications, a crypto startup owned by Lotte Group, for its NFT initiatives. NFTs were launched on the Polygon (MATIC) blockchain network, and the partnership expanded over time.
The retailer extended its NFT reach by integrating NFTs with virtual influencer Lucy and the popular horror movie “The Witch: Part 2. The Other One.” Plans were underway to enable secondary NFT sales on Opensea, the world’s largest NFT trading platform.
Focus on Core Business Areas
Following the closure of NFT Shop, Lotte Home Shopping will completely withdraw from the NFT sector. The remaining NFT business, including Bellygom NFT, will transition to Daehong Communications.
Hyundai Department Store also recently exited the NFT market after launching its NFT wallet services (H.NFT) in 2022, which offered discounts and free gifts to customers. Similarly, Shinsegae has scaled back its NFT offerings amidst the slowdown in the NFT market.
An unnamed industry insider remarked, “Retailers rushed into the NFT business initially, but with the market slowdown, they are now shutting down their platforms one after another. They are redirecting efforts to strengthen their core business competitiveness.”
In conclusion, the decisions by Lotte, Hyundai and Shinsegae reflect a strategic shift among South Korean retailers away from NFTs towards reinforcing their core business areas. These closures mark a notable retreat from the once-promising NFT sector, underscoring the challenges faced as market dynamics evolve.
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