The Future of NFTs: Illusions or Optimism?

NFT was first introduced in 2012 as a colored coin token representing real assets on the Bitcoin blockchain. Then it only took six years to have the explosion. Specifically from 2018 to early 2022, NFTs were like an international phenomenon around the world. It reached $2.51 billion in 2021 in NFT sales in the art segment.

According to Research and Markets, NFTs’ values are expected to increase from $3 billion in 2022 to more than $13 billion by 2027. Yet, the report was published in June while things in the financial markets can change within a blink of an eye.

Recent statistics of NFT trading volume dropped 97% from the peak, according to Bloomberg. So, it is reasonable to raise the question of the NFT’s future. Some optimists say the downs of investments do not necessarily bode ill for what will happen to NFTs.

Why don’t you join us in breaking down this concern?

The plunge in NFT trading volume from $17 billion in January 2022 to $466 million by September has made many people worry about the future of NFTs. OpenSea, one of the biggest NFT markets, underwent a drop of 99 percent in transactions within August. Specifically, OpenSea witnessed a downfall from 2.7 billion in May to 9.34 million transactions in August.

Moreover, the prices of popular NFTs by Bored Ape Yacht Club plummeted 53% while the ones of CryptoPunks fell 20% from their peaks.

The crisis of cryptocurrency or crypto winter plays an essential role in the downfall of NFTs. As most tokens are built on the crypto-based blockchain. The drop in the trading volume of NFTs happens at the same time as the mass layoffs of many crypto companies such as Coinbase, BlockFLi, and Crypto.com.

Well, it is hard to confirm the right answer to this question. In other words, it divides people into those who keep their hope in the NFT future and those who are less positive about the future of digital art.

When investing in something, especially NFTs — a new form of monetizing unique digital art, we can and should hope for the best to come, yet cannot expect only the best things. Investors need to see things from a realistic viewpoint which leads us to the expectation of both ups and downs in the NFT markets.

A CryptoPunks NFT was sold at the price of $4.5 million on September 28th, 2022. It is true that the number was quite humble compared to its prime time. Yet, it is not bad as the values are still high.

While it seems like selling artworks through NFTs is now a trend among artists and creators, some people show their confusion and even argument about this kind of form. The values of NFT artworks are determined by how many people are willing to buy them rather than the quality of art itself. This concept goes against the pure provenance of artworks.

We do not agree on any side completely. Don’t complain that we are so ambivalent, yet many artists join NFTs to earn more from their hard-working art projects, which can be a reward. Meanwhile, we also share the same perspective that how many people are willing to buy the artwork is not the only factor deciding its value.

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Anyway, the downfall that NFTs have suffered is not the signal for its ending. Stay tuned to our updates by subscribing to our Medium profile.

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