This year, the art world was captivated by non-fungible tokens. In the digital world, NFTs are a sort of digital asset used to prove ownership of a particular virtual item, such as an online photo or video or even a sports trading card.
At Christie’s auction in March, South Carolina-based graphic designer Beeple sold an NFT for a record $69 million. That month, Jack Dorsey sold his first NFT tweet for $2.9 million.
Sotheby’s just sold a rare digital avatar known as a CryptoPunk for $11.7 million on Thursday. NFT sales topped $2 billion in the first three months of the year, according to Nonfungible, a market research website.
It appears that the NFT craze is on its way out. As reported by Nonfungible, total sales fell from $176,000,000 to $8.7,000,000 during the course of seven days starting on May 9. It’s safe to say that volumes are roughly where they were in the beginning of 2021 currently.
A Chart with a Swirling Logo
It seems that the price of key NFTs is falling. One of the most popular NFT projects, CryptoPunks, dropped from an average weekly revenue of $99,720 in early May to $50,840 at the beginning of June. The average price of a piece of SuperRare digital art has dropped from $31,778 to $5,342 over the same period.
According to Gauthier Zuppinger, chief operating officer of Nonfungible, MeeBits, a new crypto collectable item made by CryptoPunks developers, was a major factor in the NFT market’s precipitous collapse.
Because of the rapid rise in any trend, he explained to CNBC, “you’ll observe the relative decline, which basically stands for a market stabilisation.
According to Geoff Osler of app S!NG, the digital collectible mania may have been fueled by “pent-up demand” from rising cryptocurrency prices, which has now calmed down in parallel with the decrease in cryptocurrency markets.
What are NFTs, and how are they used?
On Monday the price of Bitcoin was little over $39,000, down from a record high of $65,000 in April.
What’s in store for NFTs?
The recent slowdown in the NFT market isn’t seen as the end of the road by NFT supporters.
Nadya Ivanova, chief operating officer of L’Atelier, a research group linked with BNP Paribas, told CNBC that “high-profile NFTs selling for millions of dollars was a sure evidence that the market was seeing them as speculative assets.”
Furthermore, speculative asset markets are “unstable and prone to dry up” by definition.
NFTs’ long-term value, Ivanova continued, “is something we feel to be substantial.” In the future, “regular people will spend more and more of their time and money in virtual settings as augmented and virtual reality technology advances.”
In the tech business, augmented and virtual reality (AR/VR) have been talked about for a long time, with corporations like Facebook and Microsoft making major stakes in the sector. However, the technology has yet to be widely adopted.