The "NFT" sphere explained

The “NFT” sphere explained – Mail Bonus

Non-fungible tokens (NFTs) have increased in popularity over the last year, but are they falling from their heights? Are NFT disintegrating before our eyes or are they just getting started?

The NFT market is experiencing a fall from grace, much like the world economy. In fact, these two elements are inseparable. When the US Federal Reserve raises interest rates, the world feels that inflation is tight. Amid the global economic downturn and war in Ukraine, interest in NFTs has waned from investors, who are less inclined to predict NFT projects. Despite this testing period, it will be interesting to see which NFT museums survive and prosper in this hugely volatile market.

The truth is that despite all the bad media about NFT lately, the technology continues to evolve. Although profile picture (PFP) NFTs are no longer working, we will see a new, more complex type of NFT now, as technology advances. This new type of NFT is well-positioned to change the way we conduct business in the future.

Many people have declared the death of NFTs while technology is still in its infancy. According to coinmarketcap.com, the market value of NFTs is currently around $ 12 billion, indicating that strong growth is still expected.

Decline in digital assets

Recently, we have seen the value of NFT collapse in parallel with the collapsing cryptocurrency market. Previously obscene NFT price tags, such as the $ 2.9 million tweet from Jack Dorsey, the founder of Twitter, have been put into reality. The buyer of this famous Twitter NFT, Sina Estavi, recently put NFT up for auction and was offered the highest bid of $ 14,000. Oops, yes, inflated price tags are starting to adapt over time.

Similarly, holders of the legendary Bored Ape NFT have seen the value of their NFTs collapse. In the OpenSea secondary market, the floor price for the Bored Ape Yacht Club (BAYC) 91 ETH stock at the time of writing ($ 179,715) – down from a historic high of $ 276,697. In fact, Ethereum, the blockchain owned by Bored Apes, dropped to $ 1,976 from $ 4,800 in November last year.

Source: Bored Ape Yacht Club on OpenSea

Nevertheless, BAYC is a very resilient brand and their community is strong. To put things in perspective, Bored Ape NFTs are still selling for over $ 200k at the time of writing, which is still a lot of money. This indicates that the monkeys are going nowhere and the army of famous Bored Ape fanatics, led by pop culture icons such as Paris Hilton, will not hear of an NFT bubble bursting.

NFTs maintain value and longevity

Let’s not forget that in January, just a few months ago, sales of NFT were booming and reached almost 5 billion dollars on OpenSea. Despite a recent 50% drop in secondary market sales, money is still being spent on NFTs and especially those related to metaverse.

Indeed, with an international metaverse on the horizon, it could be strongly argued that the best is yet to come for NFTs. Indeed, NFTs will be inseparable in a thriving metaverse economy and will therefore have long-term value. When distributed metaverse platforms emerge, dependent on the acquisition and sale of digital assets, technology will be more important than ever.

Furthermore, blockchain games are becoming a pretty big thing and guess what they thrive on? Yes, NFT. If you do not believe me, just ask Square Enix (SE), the owners of the timeless Final Fantasy brand (one of my all time favorite games). In its quarterly report, SE expressed its intention to pursue a future in blockchain technology and especially NFTs. After successfully managing NFT computers in one of their games, it looks like they are investing their future in Web3 and metaverse.

In addition, they are looking to create their own blockchain game icons and have partnered with venture capital firm Animoca Brands, which owns The Sandbox metaverse.

There are about 1 million daily active blockchain players today, according to DappRadar, which is the same as it was in January. These players are not spending as much as they used to be, but they are still there and are still playing.

Therefore, it might be more realistic to say that NFT spending has fallen from an unsustainable exchange rate to a peak in January. What does all this mean for the future of NFTs?

NFT utility and depth

Those who are about to start their own NFT project would be wise to build utility and depth into their ecosystem.

Buying NFT needs to mean something and keep the value in the long run. It could be that your digital ID gives you votes in the community you worship. Or maybe, your NFT is your work for real estate (as we’ve already seen in the digital world). In fact, your NFT could be your own personal job application template.

With irrevocable ownership stored on the blockchain, the possibilities for NFT utility are limitless. I believe that in the near future of NFTs, we will see a much more powerful, sustainable image of a digital symbol, which gives the holder an integral value.

NFT needs to have more than neat value. Owning an NFT should be beneficial to the holder, with sustainable, long-term value.

Blockchain education and security

In these early days of NFTs, people need to learn about what to buy and how to avoid phishing – a persistent plague in space.

Binance has its own blog where you can read about all kinds of topics like “how to evaluate the value of NFT? or “how do NFTs affect the environment?”. Informative blogs like these are essential to provide a more secure, secure future for blockchain and NFTs.

In terms of security, we’ve seen some notable breaches recently, which have rocked the foundations of the blockchain. Nothing more than the $ 625 million Axie Infinity robbery, which showed that there are practical glitches in the blockchain armor. It was a painful lesson for players who lost their assets and the game itself, which has suffered heavy losses as a result.

Make no mistake, Axie’s developer Sky Mavis learned from the loss and their reaction has been to tighten security on the lost Ronin blockchain.

With a more educated community of blockchain enthusiasts and waterproof security on the blockchain, the space will be stronger and more resilient. Violations are still rare and as time goes on, cybercriminals will find it increasingly difficult to operate.

Business as usual

In the meantime, it will be fascinating to see how NFTs emerge from the flames of this economically devastated planet. How will authors adjust their policies for longevity? It may be a test time for blockchain and NFTs, but believe me, behind closed doors, authors are working in overdrive to build meaning and long-term value in their NFT projects.

I believe we are not far from a time where, whether we like it or not, NFT images will dominate our lives.

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