Here are the biggest options

Non-fungible tokens (NFT) have their first highlight with the auction of Beeple’s digital artwork Weekdays: The first 5,000 days Sold for $ 69.3 million at auction house Christie’s. Until then, it was mostly unknown artists who offered their digital images for sale on marketplaces like OpenSea or Superrare. This market still exists and is constantly evolving. However, the probability of earning tens of thousands of euros or ethers with simple digital products decreases with each passing day – at least for those who are not prominent.

Now comes the superstars and mega-brands

Within months, the superstars took over the field. The world’s most famous artists, who already have millions of followers on Instagram and Co., are now attracting the full attention of the NFT industry. It does not matter if it is the exceptional football player Lionel Messi, No. 1 DJ David Guetta or gossip celebrities like Paris Hilton: they are all part of NFT projects. Even the largest companies in the world, such as Coca-Cola or Visa, are invested in the NFT sector or use it for their own advertising campaigns.

More and more people understand that a whole new value creation is opening up. All people and brands with a certain range can generate huge extra revenue. Nevertheless, there is likely to be little change in market shares. The most valuable brands and the most famous stars also make the most money. The advertising market is just the tip of the iceberg. In the long run, it’s about nothing less than converting the analog world to the digital one. It can be tangible things, such as clothes, land or cars, but also intangible items, such as patents or licenses. In addition, digital content such as social media accounts or Internet domains may already be incorporated through non-fungible tokens.

NFT: Too much innovation prevents burglary

Although no new technology can do without the formation of bubbles and violent correction phases, there are good reasons why it will not happen in the near future with NFT on a larger scale. The innovation cycles appear to be particularly rapid in NFT development. There is too much new innovation on the way for the entire sector to be in danger of falling into a downturn in the near future.

While simple images of crypto-affine no-name artists have passed their peak, other NFT sectors have just begun. So it would be a mistake to generalize about the NFT ecosystem. The NFT sector can rather be divided into many individual sub-sectors, such as: digital art, lifestyle and brands, games, music, phygital (= physical and digital) objects, etc.

Various sectors are entering the market and investing billions to secure a place in the digital creative economy. This also explains why the largest funding in European history recently emerged for an NFT start-up. The French company Sorare, known for its digital football trading cards, has raised $ 680 million worth $ 4.3 billion. But other NFT companies, such as Dapper Labs with a recent $ 250 million funding, are raising tens and hundreds of millions of dollars from well-known investors to build the infrastructure of the NFT economy.

It is a mistake to compare these NFT developments with other developments in the crypto sector. Non-fungible tokens are the first blockchain application that appeals not only to people with an affinity for finance and digital, but also to the general public. Within the next 24 months, it can be assumed that most young people from the industrialized countries will come into contact with the NFT.

The gamification and visualization of the underlying technology blockchain of NFT, especially in the field of social media, cannot be compared to anything before. NFT turns people into crypto users who previously had no connection to cryptocurrencies, wallets, dApps, etc. and deliberately never wanted them.

Current driver: Blockchain game

The gaming sector is currently making a particularly strong contribution to the establishment of the NFT. Games like Axie Infinity (AXS) were able to reach billions in capitalization within a few months. To illustrate: In May last year, the market value of the cryptocurrency AXS was about 8 million US dollars and a price of about 0.12 US dollars. In September this year, AXS reached a market value of 5.6 billion US dollars at a time over 92 US dollars. Theoretically, properly invested, $ 1,300 would have been enough to become a cryptomillionaire.

Axie Infinity is certainly an extreme example, but there are several other NFT projects that have risen in price by a factor of 100 and more. Speculation and exaggeration can certainly not be denied here, but games like Fortnite prove that billions in in-game items have a basic foundation that goes beyond short-term speculation.

Given the rapid growth of the gaming industry, especially in e-sports and virtual reality, it is not unreasonable for NFT to become the economic cornerstone of the gaming industry. The current market turnover for the gaming industry of 155 billion US dollars (forecast for 2021 according to Statista) will probably be largely based on blockchain or token infrastructures in the future.

NFT is above the law

Critics may argue that NFTs are virtually worthless from a legal point of view and may not include any property or use rights under applicable law. Equivalent rights can only be entered into through subcontracts. For example, you can only own a physical work of art, but not a digital one. The fact that you only acquire an electronically stored date – this is how the legal description for an NFT should be defined – seems to bother few people so far. The value of an NFT goes beyond what is legally fundamental as it derives its value from the social construction.

Anyone who holds the NFT for a digital thing is also the owner in the eyes of society and can enjoy status recognition and collector prestige even if they do not acquire any image rights by using the example of a digital work of art. Non-fungible tokens thus cultivate an abstract understanding of digital value that is defined by the subjective perception of people and not by the legal profession – at least so far.

The $ 90 trillion market, or the reflection of world GDP

Everyone underestimates the market for NFT. The reason: What we understand by NFT today most likely has very little to do with what NFT will be in 10, 20 or 30 years. As the analog world continues to be translated into digital over the next few years, all non-fungible elements will also be mapped via NFT or related token constructions such as social tokens.

In the simplest case, that means there will be a digital twin of everything. Everything that exists in analog then also exists in a digital version in order to establish a digital other economy in the metaverse. At the moment, it may all sound like science fiction, but in practice, several current projects aim to do just that. Either in a centralized form through Facebook’s efforts to build a metaverse, or through decentralized alternatives like Decentraland.

So if you want to know how much value can be tied up in the NFT in the future, you can – however crazy and remote it sounds – define the current global GDP as the target figure. According to IMF estimates, global GDP was $ 87 trillion in 2019. Whether this will ever happen, and how many decades it will take, is, of course, pure speculation.

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