As the cryptocurrency market has cooled, the NFT field seems to have begun to cool down.
According to a report by Nonfungible.com, since May, the overall sales of NFT have plummeted from a high of $176 million to $8.6 million, a 95% plunge. Weekly sales were down 95% to just $9.2 million as of June 15.
This means that the current trading volume has basically returned to the initial level at the beginning of the year, and it seems that the enthusiasm for NFT is calming down.
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The outing of the NFT encryption market
It is indeed unexpected and reasonable for NFT to lead the blockchain out of the circle.
Although well-known digital currencies such as Bitcoin have continuously set new highs in price in recent years and become a permanent hot topic in the financial circle, they have always been a game for a few people, and there is no real sense of getting out of the blockchain. circle. In fact, many people began to pay attention to NFT because of a message on March 6 on Twitter. At the time, Twitter CEO Jack Dorsey seemed to want to sell his first tweet in 2006 as a non-homogeneous token NFT.
The next day, Sina Estavi, CEO of Bridge Oracle, a digital currency trading company, bid $2.5 million to buy it. This transaction caused quite a stir at the time.
It is precisely because of the continuous blessing of celebrity effects that more and more mainstream artists choose to bind their works with NFT. Among them, the most successful NFT artist is Mike Winkelman, who is known as Beeple. The total price of his artworks is as high as 142.7 million US dollars. The price potential of NFT artworks is vividly displayed in the eyes of collectors around the world. before.
According to the "2021 NFT Art Market Report", the number of active NFT accounts in the world has grown to more than 200,000 in 2020, four times that of 2017, and the number one active account activity is digital art. As of April this year, NFT artwork sales reached $437 million.
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Traditional industries enter NFT
Now, the three letters of NFT have taken the world of finance, music, fashion and sports by storm.
Since NFT itself has its own financial attributes, more and more new trading platforms, lending agreements and their derivatives have begun to appear.
On June 9, LINE's virtual currency business LVC announced on the 9th that it will launch an NFT market.
On June 16, according to JP.Cointelegraph, the Japanese financial services group GMO announced the establishment of a new company, GMO Adam.
The music industry based on the "fan economy" establishes a link with NFT.
On May 25, singer A Duo released a new song "WATER KNOW" on his personal Weibo. The whole song was digitally encrypted using NFT technology, and the cover and the authorship of the song were auctioned for public welfare. The final work was sold at a price of 304,271 yuan.
On June 17, Foundation tweeted that Chuck D, the founder of the legendary American rap group Public Enemy, known as the most successful hip-hop group, officially opened a Foundation account and has minted NFT works.
Of course, in addition to fans, fans' dedication and enthusiasm for idols have also made NFT successfully enter the sports track.
With a Lebron James (Lebron James) slam dunk priced at a high price of $100,000 in the NFT market, NBA All-Stars have also joined the NFT feast. It is reported that the single-day sales of NBA TOP Shot, an NBA digital collectibles platform, soared 140 times in just one month this year. Throughout January, the price of a single NBA Top Shot star card also hit new highs repeatedly.
In addition to the help of NBA stars, the addition of luxury goods in the fashion circle has made NFT the "C" position in the fashion circle.
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The "black" of NFT bubble
Although NFT has obvious advantages in various fields and has great development potential, it is undeniable that several major problems need to be solved in order to realize the comprehensive promotion of NFT.
First of all, are digital works represented by "Every Day: The First 5000 Days" really worth that much money? It started at $100 and last sold for $69.34 million.
With such an exaggerated transaction price, even Beeple himself said that the price of NFT is "absolutely" a bubble.
Even Beeple has long been recognized as a pioneering digital artist. But only from the aesthetic point of view, this painting does not show a strong appeal, and its valuation should not be so high, it is hard to say that it is not stained with bubbles.
On the other hand, according to statistics, most of the high-priced NFT works currently come from well-known big V creators in the circle, while Xiaobai, who has just entered the industry, has few works sold.
Secondly, in terms of compliance, due to the high similarity between NFT and ICO (Initial Coin Offering), it has also been questioned. Because the value of NFT works is generally high, investors will naturally purchase NFT rights in order to obtain their ownership. This is very similar to the routine of hyping ICO in the past, involving many regulatory issues.
The SEC has initiated a lawsuit against Ripple (the issuing company of the token XRP), and has launched judicial discussions based on the case. It may use this case as an example to formulate guiding principles for the entire cryptocurrency industry, but it has not yet been finalized.
However, the direction of future regulation is still a major variable facing NFT.
At the same time, in terms of transactions, the transaction, creation and verification of an NFT is accompanied by significant features such as high energy consumption and low efficiency. This problem is particularly prominent under the political correctness of the global discussion on the issue of "carbon neutrality".
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The potential "white" of NFT
Although the current NFT market is highly speculative, there is a large bubble in the price, and the compliance issue has not yet been concluded.
But as Nadya Ivanova, a researcher at BNP Paribas, said: "The important thing that people need to understand about the NFT market is that it is very new. The market is still going through different market cycles that determine the true value of things."
In the future, with the implementation of more NFT applications, it is likely to become the key driving force and cornerstone for many industries to realize the transformation of the digital economy. For example, NTF can intersect with other fields such as decentralized finance (DeFi), and launch new derivatives trading markets, products and services, similar to "fragmented NFT", collateral NFT, etc.
There is hope to create a virtual reality world on the blockchain, bringing greater changes to the way of life of the public.
