UK toyco Toikido has partnered with New York’s Herotainment and NFT maker Reality Gaming Group to create licensed toys and merchandise based on the Smighties brand.

Herotainment (the prodco that owns Smighties) and Reality Gaming Group previously created a Smighties universe website where kids can buy NFTs and learn about the characters—small creatures who collect gems and protect the world. Under the new deal, Toikido will launch a line of toys including plush, collectibles and trading cards that tie into that digital world. When the physical toys arrive on shelves globally in April 2022, each one will come with a QR code that kids can scan to unlock digital (NFT) versions of the Smighties characters (pictured).

Toikido is a relatively new toyco that launched in 2020, and this marks its first NFT deal. But the digital collectibles, which have their ownership stored in a digital ledger or blockchain, is a natural fit for the Smighties brand because it features more than 136 creatures, says Toikido founder and CEO Darran Garnham. These unique pieces of digital content give families more value for their physical purchases and build the brand into a collectible property, he adds.

“I have been following the [NFT] space for a few years, and they have begun disrupting many industries, from sports to fashion,” says Garnham. “As they go mainstream, we will see more family IPs enter the space.”

NFTs have been gaining traction with toycos this year, with Funko, Mattel, Toy Mint and WildBrain all jumping on the bandwagon. A number of US adults are already collecting these virtual items, and 23% of US millennials say they have purchased an NFT, according to a March 2021 study from Statista.

Banking on continued adoption of the tech by kids and families, Toikido is in talks with NFT strategy firm Nftie about how to incorporate it into other brands. And it’s working with IP owners interested in adding value to their properties through the tokens, says Garnham.

The toyco is also developing a plan for Gang Beasts, a multiplayer video game from British indie studio Boneloaf in which players battle in different environments. These toys should arrive on shelves in 2022, says Garnham, adding that Toikido is simultaneously working on three of its own IPs, exploring a 360-degree approach that encompasses animation, gaming and NFTs to give fans more touch points.