Non-fungible token ( NFT) is a crypto asset. These are digital assets stored in the form of pictures, videos, audios and other e-files. Block-chain technology is used to track the ownership of such assets.
The prices of NFTs are defined by what buyers are offering and willing to pay. It is a risky market since its fairly new and prices are uncertain. Some of the most famous NFT marketplaces are OpenSea, Reliable and Foundation.
The coronavirus pandemic led to the rise of the NFT market. The industry grew in triple digits and reached a value of $250 million.
In the first few months of 2021 it recorded sales worth more than $2 billion compared to the $13.7 million in 2020.
As per NonFungible.com, the number of buyers have outnumbered the sellers since March 2021.
The highest sale ever made was on Christie’s, an auction house for digital artwork image made by a graphic designer Beeple that went for a record $69.3 million. The bidding for this started at $100 and shot up subsequently.
Followed by this is CryptoPunk a digital avatar that was sold at $11.8m at Sotheby’s.
Another notable sale that was made is the first tweet that had been made on the micro blogging site. Jack Dorsey, CEO of Twitter sold that tweet for $2.9 million.
This industry seems to have picked up during the pandemic – experienced a surge – but seems to be fading away.
Nonfungible.com reported that sales touched a seven day high hitting $176 million on May 9 and then fell to $8.7 million by June 15. Several other NFTs saw a fall in prices as well, one such was CryptoPunk.
The decline of sales and prices is said to because of new collectible entrants.
“The thing is that, each time you’ll notice such a quick increase on any trend, you’ll see a relative decrease, which basically stands for a market stabilization,” Gauthier Zuppinger, COO of Nonfungible said.
Even though this segment is seeing a decline its here to stay for the long run.
“The bigger question for NFTs is their long-term value, which we believe is likely significant. As augmented and virtual reality technology matures, normal people are going to spend more and more of their time and therefore money in virtual environments,” Nadya Ivanova, the COO of L’Atelier said.