Village of Yamakoshi in Japan’s Niigata mountains found a new way to fund its development using non-fungible tokens (NFTs). The Neo-Yamakoshi Village project, launched in 2021, has attracted 1,700 “digital citizens” who purchased Nishikigoi NFTs, raising over 3,000 tokens.
These digital assets serve as identifiers and governance tokens. They allow people to participate in decision-making through the village’s distributed autonomous organization (DAO) procedures. This system gives voters a say in the community’s outcomes.
The proceeds from NFT sales have been set aside for various community projects. The first project focuses on sports activities for school children. However, the Neo-Yamakoshi Village project faces some challenges. Older residents need help with technology, and there are communication barriers due to the international scope of the project.
Low voter turnout in DAO elections highlights initial hurdles in integrating digital governance frameworks into traditional community settings. Despite these challenges, the Yamakoshi project has received support from Japan’s government. This support aims to expand the project’s impact and serve as a model for other municipalities in Japan.
Meanwhile, the global NFT market has seen a downturn. Trading volumes have dropped significantly, with the second quarter of 2024 projected to be down 45% compared to previous periods. Despite this, observers note that Japan has a tradition of collecting tokens, which may help keep the business case for NFTs strong.
The Neo-Yamakoshi Village project represents an innovative approach to community development. By combining traditional and digital elements, it seeks to create a sustainable model for other villages and towns in Japan. This blend of old and new aims to build a stronger, more connected community while exploring the potential of digital assets.
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