Bubble or property opportunity on the internet?

Last week, YouTube announced its interest in entering the NFT market. As reported by BTC-ECHO, the purpose of the introduction should be for interested parties to “own” their own videos. There is also news in the NFT market apart from the video platform. For example, the painting “The Kiss” by Gustav Klimt is to be sold on Valentine’s Day in the form of 10,000 non-fungible tokens. According to the Belvedere Museum in Vienna, it writes art history. And that, even though it is not yet known how big the rush for the 1,850 euro mosaic NFTs will be. However, the museum believes that through the acquisition, a “personal connection to the masterpiece” could be established. Only prospective owners can probably assess whether this is really the case in the end. The fact is, however, that more and more companies and individuals are entering the NFT cosmos.

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NFT’s total market value is over $ 16 billion

But when Messari collapsed last week, the art market is “only” the third-largest NFT category by market value so far. In all, nearly $ 2.3 billion would have flowed into these digital works of art so far. According to the research firm, several investments were made in the gaming NFT area (second place with about $ 3.4 billion). However, digital avatars currently have the largest position in the overall market value of NFTs.

According to Messari, these avatars account for almost half of the total market value of NFTs. Among other things, they serve the owners as digital identities in the meta-verse.

In the last few weeks alone, many famous personalities like Heidi Klum or Neymar Jr. equipped with NFTs such as those from the Bored Ape Yacht Club (BAYC). In the eyes of many crypto fans, these little monkeys are far more than just digitally created images. More about this in the following posts:

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NFT meme culture

The critical comments from NFT “opponents” are often backed by memes. For many people, it is incomprehensible how millions can be paid for NFTs. Especially because you still can not protect them from possible replication attempts. El Hotzo, the satirist, seems to share this criticism, as his Twitter post suggests.

Tim O’Reilly, Internet guru and author, is also currently seeing a bubble in the NFTs. In an interview with CBS Money Watch he says: “I think it’s really a serious bubble with a little foundation.”

So far, NFTs are determined by developing an ever-broader base for individual buyers. The number has been steadily increasing since January 2021.

The SEC belongs to the group of critics

Along with a few individuals, the U.S. Securities and Exchange Commission (SEC) is among the critics of NFTs, particularly in the art world. In her own report, she writes, among other things:

The ability to execute NFTs across borders across the Internet, regardless of geographical distance and almost instantaneously, makes digital art vulnerable to the exploitation of those who attempt to launder illegal criminal proceeds. This is because the value movement can be performed without the potential financial, regulatory or investigative costs of physical shipping.

SEC, Study of the Facilitation of Money Laundering and Terror Finance Through the Trade in Artworks, February 4, 2022

It should be noted, however, that it is a well-known phenomenon in the art world to buy paintings at high prices to launder money or avoid paying taxes. These are so often stored in so-called “free ports” (large halls in the transit area at airports). The authorities do not have access to this either. With NFTs, however, the authorities have at least the ability to track the exact history of transactions with their owners via blockchain technology. Shouldn’t it actually make your job easier?

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