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  • Writer's pictureGerard Kavanagh

Ying and Yang

The WSJ claimed sales of NFTs are “flatlining” — in the same week that the top five collections alone accounted for more than $1 billion in primary and secondary sales. The article cited data from NFT market analysis platform Nonfungible suggesting the number of NFT sales has fallen by 92% since an all-time high in September 2021. Wallets active in the Ethereum NFT market were also said to have declined by 88% since a high in November 2021. “The NFT market is collapsing,” the article concluded.

Naturally, there were push-back articles and we certainly aired one in a previous blog commentary. Here is a good rebuttal chart from Dune:

There is a bifurcation in the NFT market. “There’s clearly a trend right now that five or six of the most successful projects are sharply outperforming while the rest are flat to down,” pseudonymous NFT market analyzer NFTstatistics.eth told Cointelegraph.

This trend is normal, and not just in art markets - there are winners and there are losers - Darwinism at work! It's the sign of a healthy ecosystem (and differs greatly from the supposedly capitalist real-world markets and zombie corporations). The crypto press is now moving back from challenging the WSJ article (and indulging in some healthy introspection on the market), to looking to the future and what might be. For example, we offer this snapshot from a recent Cointelegraph article: "Reflecting the growing interest in the non-fungible token (NFT) space among today’s investors, new research predicts that the existing $3 billion market size will reach $13.6 billion by the end of 2027. For the next five years, the key factors tied to the global NFT boom continue to factor in the growing involvement of mainstream influencers, gaming communities and the rising demand for digital artworks. Interestingly enough, research firm MarketsandMarkets envisions several other factors that will contribute to the explosive growth of the NFT market, including its increasing use cases in supply chain management, retail and fashion.

Global NFT market trends. Source: MarketsandMarkets Some of the other catalysts well-positioned to further speed up the growth of the NFT market are metaverse initiatives by existing market leaders such as social media giant Meta and the personalization of NFTs. In November 2021, Cointelegraph reported on the rising interest from Asia-Pacific (APAC) investors as local NFT-related Google searches surged in the region. MarketsandMarkets, too, cited this trend: “APAC countries are emerging toward constant developments and marketplace launches in the given market to give creators and buyers equal opportunities in the ecosystem.” Of course, all forecasting is utterly useless, and mere conjecture. However, what does give us confidence that the future is bright for this sector is what outside parties, the mainstream, see beyond the usual rah-rah commentary on rising demand for digital artworks (though that certainly is true). What the investment world and others see is a widening of the NFT potential from digital art and gaming applications. As Prof Scott Galloway wrote:

"NFTs offer digital commerce something the Internet lacks: scarcity and authenticity. A scarcity mentality is built into us at an instinctual level. Our cravings for sugar and fat (historically scarce) have resulted in an obesity crisis, because our instincts haven’t kept pace with industrial food production. Authenticity’s virtues are practical (we like to know where our food comes from and who we can sue if it makes us sick) and philosophical (if we buy music, is some of the money going to the artist who made it?). Limited options for credible scarcity and authenticity have rendered digital commerce chaotic. Napster broke the barriers of scarcity that were inherent to physical distribution of music on plastic discs. The pirating of digital goods of all kinds reduces both tech profitability and long-term innovation. Google put the news media into intensive care by reproducing its content (ending scarcity), and Facebook drove another nail in the coffin by de-emphasizing the source (neutering authenticity).

Enter blockchain. Bitcoin became a trillion-dollar asset class because it cracked this code. A dollar bill is worth $1 because only the U.S. Treasury can make it (authenticity) and we trust Uncle Sam to mint a limited number (scarcity). Bitcoin’s “proof-of-work” system likewise ensures scarcity (there will only ever be 21 million bitcoins produced) and authenticity (all are tracked on an immutable public ledger). NFTs offer the promise of scarcity and authenticity for digital goods. NFTs aren’t the only way to create scarcity and authenticity online — trusted, centralized entities such as banks (and platforms such as Twitter and Apple) do it within their verticals, and blockchain tech is evolving to address myriad environmental and security concerns. So the current implementation of NFTs may not be the best way, or even a good way (many reasons to be skeptical). But they’re … a way. A potentially widespread, inexpensive way to offer credible scarcity and authenticity online, opening up new vistas of digital commerce. Prospectors are rushing in." At the Milken Institution Global Conference this month Steve Kokinos, CEO of Algorand, said it best (speaking from an investment perspective): "In a few years nobody will be talking about NFTs, they'll be talking about the products that are encompassed in those NFTs, just like we don't talk about surfing the web anymore. I think these will just become part of the fabric of everyday life."

We here at the FIX00 project think that is correct, and that by broadening its offerings the NFT market will not only thrive but become a dominant (ubiquitous) part of our digital lives moving forward. Last words to Prof Scott Galloway: "Scarcity and authenticity are powerful, and not always forces for good. Our instinctual craving for scarce sugar and fat has produced an obesity crisis, but we aren’t going to throw out the industrial food system and live off the land. Amidst the scams and bubbles, credible scarcity and authenticity will unlock real value in digital markets." We like to think the FIX00 project and offering are very much a part of making that a reality.

For a short overview of the FIX00 project 🙂 please use this link: The Start of something new

If you still have questions, we are happy to have you join us. We take great pride in our company and the revolutionary change it heralds. Please feel free to contact us if you need further information or have further questions:: Contact Us

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