NFTs: just a bubble or the future of digital world?
NFTs, are they really just a bubble with no future waiting to burst? To understand this, let’s dig into the origins of non-fungible tokens.
It all started in 2012–2013 with an article mentioning Colored Coins, composed of small units comparable to the satoshi forming a bitcoin. Much like non-fungible tokens, they can represent property, coupons, digital collectibles and more. The value of Colored Coins was defined by the value people were willing to assign to them.
Then in 2014 Counterparty was founded, the first peer-to-peer financial platform based on blockchain with an open-source Internet protocol. Counterparty had numerous projects and resources in place, such as a collectible card game or the sale and exchange of memes.
Starting in April 2015, the first game on the blockchain, Spells of Genesis, was launched, which was later followed by many similar initiatives in 2016.
As for memes on the other hand, they first debuted on the blockchain in late 2016. The first meme, which is still very successful today, was the one of Pepe the Frog.
In 2017 Ethereum became popular and memes started being sold there as well. Also in this year came Cryptopunks and Cryptokitties, which were pretty popular at the time and are now worth a lot.
Over the next two years (2018–2019), the NFT market grew exponentially, with numerous sales and exchanges of collectibles on the blockchain.
As you can see from the chart below, the NFT market increased exponentially in 2020.
In March of this year, graphic designer Beeple sold an NFT for a record $69 million at a Christie’s auction. Jack Dorsey, CEO of Twitter, sold his first tweet as an NFT for $2.9 million in the same month.
Most recently, “CryptoPunk” sold at Sotheby’s for over $11.7 million. In the first quarter of 2021 alone, total NFT sales reached $2 billion.
New data seem to show that the NFT hype is fading. Nowadays, the volumes are roughly back to where they were in early 2021.
Prices of major NFTs also seem to be falling.
One of the main reasons for the significant drop on the NFT market has been a sudden rise and fall in sales of new crypto collectibles.
Whenever you notice such a rapid increase on any trend, you will see a relative decrease, which is meant to stabilize the market.
NFT enthusiasts do not see the recent drop as the end for the market. And so does Rarecubes.
With the rise of augmented and virtual reality technology, people will be spending more and more of their time, and therefore investing money, in virtual realities.
Rarecubes truly believes that NFTs will actually be important for our future, and that they are just the beginning of the progress that is soon to come.
Also according to other experts in the cryptocurrency field, NFTs could play a big role in the development of immersive virtual worlds.
It is certain that cryptocurrencies are here to stay. Digital art and music are trending a lot now, but more NFT fields of use and projects are certainly coming in the next months and years.