NFT transactions will reach 40 million by 2026, but the real growth may come from unexpected places
The number of NFT transactions globally is expected to reach 40 million by 2027, reaching a total market value of £13.6 billion. But the majority of this growth is currently expected to come from innovative technological projects such as the metaverse.
BanklessTimes.com has explored data from a variety of sources and revealed a very different potential outcome. Rather than innovative games or digital property rights, the greatest potential for NFTs may actually be in some very old-fashioned industries.
The future that may never be
The majority of NFT growth over the next five years is expected to come from the metaverse, with experts estimating that the number of metaverse transactions will reach 9.8 million by 2027. This will mean that NFTs are used to authenticate identity, transact transparently within the metaverse, demonstrate membership in digital communities and own digital property. In March 2022 alone, The Sandbox generated more than $24 million in sales of NFTs representing metaverse real estate.
However, there are two reasons to be skeptical of these estimates.
First, NFTs are most often seen as an investment opportunity – and a bad one at that. The latest polls suggest that 44% of people see NFTs as a bad investment, while 69% of gamers – a demographic closely associated with much of the projected future growth of the technology – hate NFTs and consider them to be “negative”.
Second, the current trajectory of NFTs may have more to do with media coverage than actual utility. Outlets are far more likely to cover big ticket sales from artists like NFT or new and disruptive ideas like the metaverse than they are to explain how NFTs can be integrated into existing operational processes.
As the public – and perhaps more importantly businesses – become more aware of the myriad ways NFTs can be integrated into existing processes, there could be a major shift in consciousness. We can see trends away from the speculative futurism of things like the metaverse towards improving reliable, legacy institutions.
Disturbing but stable
Real-world applications for NFTs are numerous and potentially transformative across many industries. Any area where ownership, copyright and authentication are issues could see NFTs provide significant value – and quickly. These industries can provide greater growth opportunities for NFTs because they are already large – and perhaps more importantly, they boast proven, enduring demand.
Publishing is a good example. The global e-book market is expected to be worth $16.08 billion by 2027 – up from $13.62 billion today. But these digital assets have historically been very easy to reproduce and share, leading to high levels of pirated and second-hand sales.
NFTs could be a way to solve this problem for publishers, with Pearson plc – one of the world’s leading textbook publishers – already planning to use NFTs for this purpose. Integrating NFTs into this well-established, trusted space can help legitimize the technology and allay fears of snake oil sales.
Supply Chain Management (SCM) is another area where NFTs are likely to proliferate. The market for SCM solutions will be worth nearly $31 billion by 2026 – up from $15.85 billion in 2020. But issues around visibility and control are perennial. NFTs can be used to solve these problems; Early research has already shown that NFTs can make new supplier onboarding up to 80% faster.
Given that $7 billion has been invested in SCM technology since 2018 – and this is only expected to continue – even if NFTs were able to capture a portion of the investment, it would represent massive growth for the technology.
Other areas include simplification of property sales; manage music royalty rights; and protecting photography copyright – all of which are multi-billion dollar industries.
Jonathan Merry, CEO of BanklessTimes.com, had this to say:
