What Killed NFTs? (A discussion; Feel free to comment below)
“NFTs don’t seem to me to have a value that can be defined as easily as ‘owning a piece of art.’ It’s more some sort of collective geist. The draw is the insanity of it all.”
Wow ………………. Just a few months back, nobody living and having a semi-decent internet connection could make a step or two without running into an NFT Ad. But now, things have changed nobody cares about them anymore as before. So I basically asked the simple question “Why do people not care about NFTs anymore?” Several reasons were discussed but they ultimately boiled down to a few reasons.
First, the number of active traders has plummeted from almost a million accounts at the start of the year to about 491,000(NBC)
Second, there’s been a flood of supply. “There are about five NFTs for every buyer, according to data from analytics firm Chainalysis,” the Journal reported. “As of the end of April, there have been 9.2 million NFTs sold, which were bought by 1.8 million people, the firm said.” That excess supply makes sense when you consider that everyone and their mother have been rushing to pump out an NFT in a bid to get in on the trend. Need to raise awareness for a cause? Auction off an NFT. Need a horrendous way to show your membership in the A-list crowd? Use the image you purchased via NFT as your Twitter avatar.
Thirdly, scams involving crypto and NFT assets. The NFT market has seen a large number of scams, which cooled the trading and purchasing of NFTs.
Fourthly, One of the main reasons NFT sales decreased is attributed to the crash in the cryptocurrency market. Since NFTs are purchased with Bitcoin, Ethereum, and other cryptocurrencies, trading-related activities are no longer profitable.
With these trends, it is unlikely that the NFT marketplace will return to its peak since its short-lived mass enthusiasm has disappeared.
The once-booming non-fungible token (NFT) market is down by nearly every trackable metric. In sectors from art to gaming, trading volume for NFTs across all sectors has plunged about 90% since this time last year, according to data from the crypto websites The Block and CryptoSlam.
One can easily conclude that NFTs are coming to an end seeing the most recent news of the plummet in NFT sales compared to previous years, and many can understandably celebrate the end of a trend that flooded every corner of the internet for over 18 months. The conclusion may be a little off. NFTs are a young market, and it is too early to tell where it will go. A few dips in sales here and there don’t mean much in the long term, but what we do know is that the “craze” period is practically over.
Currently, trying to get into the crypto market is like trying the get into the housing market in mid-2008. You were assured to be f….d. The NFT market is crashing and will likely stay depressed for some time. For investors, the crypto markets are very volatile, and there’s no telling when the next bull run will come along. Once prices go back up, the NFT market might be the next hot investment.
Till then, stay tuned.
