If NFTs are dead, why are chained monkeys still fetching $100k plus?
People take pictures at a Bored Ape Yacht Club NFT poster in Times Square on June 23, 2022 in New … [+]
Someone please tell the Bored Ape Yacht Club that NFTs are dead, because no one is listening.
Most of these top Bored Ape NFTs — digital art that people either use to create art galleries or stick to the wall in a frame in their NYC penthouse — still go for over $120,000. For some reason, Bored Ape # 6588 a price tag of 1 million dollars.
Bored Ape Yacht Club artwork sells for big bucks.
Despite the weak digital asset market, the average price people paid for an NFT is up 2.5% to $371. Buyers are down 10.3%. Sellers who want to download are 16%. Total sales are down about 10% to $10 million and change, according to the Non-Fungible Market Tracker.
People struggle to sell big-ticket NFTs. The Malaysian businessman who bought an NFT of Jack Dorsey’s first tweet for $2.5 million last year struggled to get bids for more than a few hundred dollars when he tried to resell it in April this year. Perhaps buyers realized that JPEGs are not worth millions of dollars.
That doesn’t mean NFTs are dying, as many of them are required for games or special club memberships, like the Bored Ape Yacht Club. For investors in NFT platforms or digital art itself, this means that the speculation frenzy is over.
NFT craze isn’t going to turn teenage millionaires every day anymore. With little hype left, investors will have to focus on real-world applications of NFTs, if they can find them.
“The hype around JPG NFTs and their overnight millionaire stories helped introduce people to the new Web3,” says Theresia Le Battistini, CEO and founder of Fashion League, a game for up-and-coming fashionistas ready to give blockchain a shot. “Regardless of the market situation, NFTs are the most interesting improvement in blockchain technology. NFTs are more than just images,” she says, calling them “unique digital assets” that often have a use case. “It could be for ticketing, shopping or gaming apps … NFTs will be present and will be the driver of Web3 mass market adoption, I think,” she says.
Oren Langberg CMO at MonkeyLeague, another blockchain game that uses in-game characters you can buy and sell, says that after the dust settles on the NFT bubble, “we will see, and are already seeing, NFTs with more actual utility and they are the ones who will survive the market volatility.”
Time for a commercial break. What exactly is an NFT?
NFT stands for non-fungible token. It is usually built using the same type of programming as cryptocurrency. An NFT is a digital asset that supposedly (although I’m not convinced there’s an actual Bored Monkey Yacht Club painting somewhere in a warehouse; or a new blockchain game character outfit sitting in a developer’s closet) represents real objects. These items are almost always art, but can be music, videos, and items for use in games—things like magic swords or other items these digital characters can use in this online (mostly gamer) world.
They are bought and sold online, often with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos. NFTs must also be unique and have unique identifying codes.
Manchester United’s Cristiano Ronaldo seen at the Old Trafford stadium, in Manchester, England, Monday, … [+]
The NFT boom began in 2021. It turned hundreds of artists and influencers into overnight millionaires. As the hype continued, with Tom Brady and Cristiano Ronaldo on the field, celebrities started using NFTs as a fan engagement tool. Ronaldo sold one last year for $290,000. Binance, a crypto exchange, signed him up to join the NFT grist mill in June.
Global NFT sales in July 2022 were $647 million with 532,378 unique buyers and 5.6 million transactions. As of January 2022, global NFT sales were around $4.78 billion with 1.07 million unique buyers and the equivalent of 9.36 million transactions, led by Loot, Bored Ape and Crypto Punks – the Canadian makers of those pixilated looking headshots like something from the Atari 2600.
Last year, someone spent nearly $17 million at a Christies auction on a bundle of Crypto Punk NFTs. The buyer walked out without having to carry a picture frame.
NFT Darwinism: Only the strong survive
NFTs are definitely a strange security. Short of buying digital furniture in a digital world, why would anyone want a collection of cryptopunks that exist in the cloud, and not a 5×5 painting of them on canvas that only you own?
R&B singer Trey Songz seen on November 27, 2018 in Universal City, California. He sold digitally … [+]
Last year, R&B singer Trey Songz sold an “NFT album,” allowing supporters to buy directly from him instead of from the label. Why Songz needed an NFT for that is beyond my intellect, but I wish, as a cryptocurrency investor, I understood the difference between Songs making an NFT album and him making a website and selling his music directly to the consumer that way instead of through a disc. label or iTunes?
Gaming seems to be the perfect use case for NFTs and everyone knows that the video game market, be it PlayStation or a blockchain game played by a niche audience, is a growing market. However, this is more aimed at blockchain Web3 players and not traditional games as much.
For example, late last year, Electronic Arts
“With every new innovation, many new startups appear and a frenzy begins, while in bear markets the true builders put their heads down and keep building,” says Hosam Mazawi, co-founder of Snook, a game to earn Gamefi . “There is a lot of unexplored territory in NFTs and their use cases. We introduced the first activity-based effort that allows brands or any interested group of players to host their own branded environment within our platform,” he says.
“The gaming industry was the first to see the potential of NFTs,” said Val Maincard, CEO and founder of Maincard.io, a fantasy sports management platform that offers NFT cards to predict the results of matches in the world’s major sports matches. “The use of NFTs as an in-game currency gives it the most important quality – which is liquidity. This is the most valuable feature of a product in the long run. Do people want it or not?”
Some real estate companies have also tried to create digital worlds where you can buy NFTs – which can be like the penthouse suite, a cool living room set – and maybe you can have virtual meetings there. If seems like a fantasy market, with the usual potential for massive increases in prices. If investors catch the bulls running at the right time, they will be at the front of the queue, safe from harm. Catch it too late and you risk dealing with the raging bull with pointy horns.
“The big mistake people make is equating images of cartoon animals with the underlying promise of the technology that makes NFTs possible,” says Neil Stevenson-Moore, Chief Business Officer at House of Kibaa in Vancouver. House of Kibaa is the flagship brand of Canadian digital agency Looking Glass Labs, and is a Web3 design studio for the NFT and metaverse sectors. “At its heart, everything an NFT does is to prove ownership of something digital. And in a world where literally everyone relies on a digital device in their pocket – it’s crazy to think that this technology isn’t going to be transformative,” he says. “In the House of Kibaa, we are happy that the first wave of madness has passed. This way, the true innovators will begin to emerge.”
Investors chasing NFT plays this year have lost almost everything. Enjin coin
A look at Enjin Coin and the Axie Infinity dollar exchange versus Ethereum. All three are bad. But … [+]
The cryptocurrency market loves a shakeout. Remember, they all loved the death of the initial coin offering because it was going to usher in serious projects instead of junk coins and scams. The death of ICOs eventually pushed Bitcoin to nearly $60,000. Will the carnage in NFTs eventually lead to significant gains from here for the best in the business? It certainly will. Which one it is is anyone’s guess.
Twitter
“The awareness only means that the future looks extremely promising and hopeful for NFTs,” opines Ramkumar Subramaniam, co-founder and CEO of Jump.trade, an NFT marketplace in India. “This will create a new community of purpose-driven collectors rather than those driven by short-term profit.”
*The author of this article owns Enjin coins and Bitcoin.
