Along with the crypto boom, the NFT market has also exploded, but in the declining crypto market, digital artworks have also had to lose their feathers. Where will the journey go in 2023?
• An almost infinite number of NFT projects on the market
• Crypto crash causes NFTs to lose huge value
• Not the artwork itself, but the application is in the foreground
With the rising prices of cryptocurrencies, the NFT market also experienced hype, so individual NFT sales with exorbitant prices drew attention to themselves. Blockchain’s original cryptocurrency, Ethereum, rose to the $4,000 level in 2021. However, since the third quarter of 2021, trading volume has fallen by 88 percent, according to data from Web3 developer backend Alchemy, and the Ethereum price is also currently around $1,621.79 (as of 24 /01/2023) and thus significantly lower. However, recent data also shows that smart contracts on the Ethereum blockchain have seen a significant resurgence since the end of January 1. quarter 2022.
According to statistics from “MarketsandMarkets”, the NFT market turned out to be more robust in the 2022 bear market than many critics thought: because the industry reached a volume of about 3 billion US dollars despite massive price drops last year. A growth rate of 35 percent predicts that the NFT market will be worth $13.6 billion by 2027.
Further development of NFT projects 2023: key trends and topics
For the further development of the NFT market, the topics that separate the digital from the traditional are of particular interest art market distinguish: applications that go beyond simply collecting the works of art.
Alex Taub, co-founder of Truth Labs, the Web3 collective behind the well-known NFT collection Goblintown, told CoinDesk that 2023 will thrive on projects that manage to strengthen the sense of community by focusing on more authentic storytelling that is concentrated and formed into smaller assemblies. According to the creators, Goblintown artwork is “ugly but well done,” which is exactly why it piqued the interest of collectors: “You can do anything right if you have great, compelling characters and a story,” says Alex Taub.
Another promising approach to NFTs is to give them a use case that goes beyond the actual collection of the artwork. For example, by linking ownership to certain property rights (including real estate) or access to exclusive experiences such as concerts or club memberships. nftnow CEO Matt Medved explains the approach behind supply-based projects to CoinDesk as follows: New innovative use cases of different types that meet the needs of different communities will be further developed in 2023. “You want to innovate at the forefront of what [Blockchain-]technology can really offer,” says Medved.
A successful concept in 2022 that could also set a precedent in 2023 is the Moonbirds collection from the NFT collective PROOF. Buying an NFT comes with private club membership, as well as additional benefits that are unlocked as the NFT is held for a longer period of time. The pixelated owls grossed approximately $200 million in primary and secondary sales following the launch of the Moonbirds collection. PROOF co-founder and CPO Justin Mezzell uses the term “nesting” to refer to owners who hold NFTs for the long term. The goal of the project is to build a social platform and, in addition to discussion forums, also integrate users into the conversation, Justin Mezzell told CoinDesk.
Not just an investment: Web3 strategies will determine development in 2023
With the falling crypto prices, the prices of NFT collections have also fallen after the big hype. NFTs have not proven themselves as a pure investment. Many investors’ resale opportunities and hopes for returns were disappointed in 2022. “NFTs serve more as a means to an end and less as an end in itself as an object of speculation,” BTC ECHO summarizes the importance and benefits of NFTs in an article. Also in 2023, the further development of the NFTs’ technological dynamics will be in focus. After the great hype and a self-reflective phase of the further development of Web3, according to CoinDesk 2023, further innovative and interactive application possibilities will move to the forefront of the development of the manufacturers.
The first highlight of 2023 in digital art is already on February 24 and 25 with “NFT Paris”, which this year takes place in the special atmosphere of the Grand Palais Éphémère and should attract 15,000 visitors. The prominent speakers from the range of well-known global companies such as Volkswagen, Salesforce, LVMH, Shopify and L’Oréal and NFT industry leaders such as Yuga Labs, Ledger, The Sandbox or Arianee will address the common path to Web3.
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