Only two years ago as of 2023, NFTs (non-fungible tokens) were an immensely hot topic, wildly popular and declared to be the next ‘’revolution’’ in the way blockchain technology works. Yet the fanfare to that exclamation died almost instantly within a year. Now NFTs suddenly lost more than 90% of their value in many cases. Despite this, the NFT community remained strong and unwilling to give up on the concept. In fact, recent data suggests that NFTs, once developed more, will indeed become the new ‘’bitcoin’’ of the blockchain.
But first…what are NFTs?
NFTs stand for ‘’Non-Fungible Tokens’’ and are uniquely distinct digital assets that can be inputted and preserved with blockchain technology. ‘’Non-fungible’’ itself means that each token possesses a unique trait that has a different variable market value. Sort of like a digital fingerprint, no NFT is the same. What makes NFTs different from cryptocurrencies is that they are in a way ‘’digital real estate or property’’. Rather than owning a physical item, an NFT can be bought and sold much like a real one, only NFTs do not wither and stay the exact same in quality.
And while these tokens are most known for being artwork, they can even be videos, games, and other forms of digital media. Many NFT creators usually sell through the proposition of collections, offering investors to participate in decentralized communities called (DAOs). Thus, this creates a fun and interactive engagement for NFT holders. Yet the way NFTs are preserved digitally and the way they are so different from each other is what makes them have great value to potential investors in blockchain technology.
The Rise of NFTs
From 2018–2021, NFTs catapulted into the spotlight, triggering an unparalleled surge in market value. The trend’s ignition could be traced to the success of NBA Topshot collectibles, captivating enthusiasts and collectors alike. However, the zenith of this NFT frenzy was reached (to what) with the sale of Beeple’s “Everydays: The First 5000 Days” at Christie’s, a groundbreaking event that fetched a staggering $69 million. This sale not only shattered records but also marked a pivotal moment in the valuation of digital art, underscoring the substantial potential held by these unique tokens within the broader landscape of the art market.
The rise of NFTs during this era can be attributed to several factors. First and foremost, blockchain technology provided a secure and transparent way to establish ownership and authenticity, addressing long-standing challenges in the art world. Additionally, the decentralized nature of NFTs empowered artists and creators, allowing them to reach a global audience without traditional gatekeepers. The cultural shift toward digital experiences and the desire for unique, verifiable ownership further fueled the NFT boom.
What we can learn from this era is that NFTs represented more than just a speculative market trend; they marked a paradigm shift in how we perceive and engage with art. The success of NFTs highlighted the importance of decentralization, transparency, and the integration of technology in transforming traditional industries. As we examine the potential for a possible comeback of NFTs, these lessons from their rise remain crucial in understanding the enduring impact of blockchain on the art and ownership landscape.
The Fall of NFTs
The fall of NFTs by 2023 was marked by a combination of factors that led to a significant downturn. One prominent issue was the oversaturation of the market. As the NFT trend gained momentum, a flood of new collections entered the scene, many lacking the artistic quality or compelling narratives that had initially characterized successful projects. This oversaturation led to a dilution of value and an overabundance of low-quality offerings, causing investors to become more discerning.
Public reaction to NFTs during this period played a crucial role in their decline. As the market flooded with an excess of collections, skepticism grew among investors and the general public. The initial excitement waned, and concerns about the speculative nature of NFT investments and the lack of tangible utility began to surface. The hype that had driven the market to unprecedented heights now faced increasing scrutiny, impacting the overall sentiment and participation in the NFT space.
Reflecting on the mistakes of the first wave of NFTs is essential to understanding the challenges faced by the market. One key error was the unchecked proliferation of low-quality and poorly curated collections, diminishing the overall value perception of NFTs. The market’s focus on short-term gains and speculative trading overshadowed the importance of building sustainable, high-quality projects with long-term viability. This experience emphasized the need for a more thoughtful and strategic approach to the development and curation of NFT collections to ensure their enduring success.
The Potential Rise of NFTs…AGAIN!
The potential rise of NFTs again is becoming evident through recent trends that indicate a resurgence in the market. Despite the challenges faced, blue-chip NFTs such as Bored Apes Yacht Club, Cryptopunks, and Art Blocks are showcasing signs of recovery. Trading volumes for these top-tier collections have experienced an uptick, and there is a notable rebound in floor prices, signaling renewed interest from both collectors and investors. This resurgence suggests that, while the broader NFT market faced a downturn, certain established and high-quality projects are finding support and regaining value.
Data reveals a positive shift in sentiment toward NFTs, with an increase in trading volumes on major NFT platforms. Notably, OpenSea, one of the largest NFT marketplaces, witnessed a surge in trading volume, reaching $466 million in January. This nearly doubled compared to the previous month, indicating a significant boost in NFT sales. Individual collections, such as Bored Ape Yacht Club and CryptoPunks, experienced notable increases in trading volume, further highlighting the renewed interest in these iconic NFT projects.
These positive indicators suggest that, despite the challenges faced in the past, NFTs are poised for a potential comeback, with investors showing confidence in the value and significance of premium, blue-chip collections.
Genixor Believes that NFTs will back a Strong Comeback & Why
Genixor is optimistic about the strong comeback of NFTs based on compelling evidence from recent market trends and its own commitment to technological innovation. Despite the downturn in the NFT market, blue-chip collections like Bored Apes Yacht Club, Cryptopunks, and Art Blocks have shown signs of recovery, with an uptick in trading volumes and a rebound in floor prices. This resurgence aligns with Genixor’s vision for NFTs as valuable digital assets. Genixor’s focus on bringing various assets, including digital art, gaming assets, and physical items onto the blockchain underscores its belief in the fundamental value of NFTs.
The platform’s NAS (Network Attached Storage) Backup Solution further solidifies its dedication to providing a secure and efficient environment for storing NFTs, offering users a seamless and trustworthy experience. With a user-friendly app, files, photos, and videos can be seamlessly backed up from mobile devices to the Genixor router, which doubles as a NAS device. This solution ensures the security and authenticity of NFTs within the Genixor ecosystem, where users can share network resources, storage space, and bandwidth, earning tokens in the process.
Genixor even has features like flexible broadband connectivity, versatile protocol support, enhanced security, and control, and streamlined network configuration. All of which ensure that users have a seamless and secure experience as they engage with the NFT market. As a technological trailblazer, Genixor is positioned to play a pivotal role in the anticipated strong comeback of NFTs.