The crypto market has been a wild ride in 2021. From Bitcoin’s highs and lows to new tokens emerging in a competitive market, there’s been plenty to see for potential investors. One of the many successful crypto market areas in 2021 were non-fungible tokens, a new way of distributing media.
The NFT boom in 2021 took a few years to develop. Originally invented as a set of tokenized 24×24 pixel art images built on top of Ethereum in 2017, NFTs reached their apex this year. They were free for everyone to use initially, but in the past 12 months, their popularity and value exploded, with the crypto market weighing over $1.5 billion.
A Surge Like None Before
Digital artworks, music, and videos are the most common NFTs sold in 2021. Plenty of superstars have joined the list. Rock band Kings of Leon has fully released its latest album as an NFT, and Canadian singer The Weeknd did so too. Live performances are being released by numerous bands and artists, and digital artist BossLogic has collaborated with football superstar Lionel Messi for a collection of the Argentine’s defining moments being released as NFTs.
Some of these NFTs are worth millions – the top sale this year was $7.6 million. The value is expected to rise further, with the latest NFT drops generating a lot of interest among investors. It’s a thriving market with a crazy upward trend. But, what are the reasons for the recent NFT surge? One word – collections.
All NFTs are unique. There might be 50 different editions of a video, but they are each attributed with a unique number. NFTs are aimed at collectors. While some of these pieces don’t give you exclusive rights over the video or artwork, collectors believe that its real value is in owning the NFT. For this alone, NFTs have been heavily criticized, yet that didn’t stop numerous collectors from splashing millions on artworks created with ones and zeroes.
Will the NFT Bubble Burst?
Many consider NFTs the latest crypto bubble. The market has been on a crazy upward trend in recent months, and its value will climb further. However, experts are warning that the market is timely and will eventually burst. Unless you’re a collector of unique video pieces or moments as NFT creators call them, many don’t see the point of investing in non-fungible tokens.
Artists have been flooding NFT marketplaces as a way to make a quick buck. To be honest, the market is oversupplied all of a sudden, which definitely impacts the uniqueness of each NFT. Still, the crypto bubble has remained relevant for much longer than expected, so there’s no way to tell when or if the NFT bubble will burst.
One thing’s for sure – NFTs gave artists and crypto enthusiasts a new channel to share their moments on. Such bubbles are always a precursor to innovation. Owning digital assets may not look like it, but in a few years, NFTs may fully unlock new models of online entrepreneurship such as collaboration economy.
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