With market volatility being experienced across the board, the NFT space is also facing tough market conditions, The crypto collapse has seen steep declines and a spooking of investors with NFTs dropping 92% from their peak last year.
Amid the meltdown in the crypto world, the collapse of Terra USD has been a sobering reminder of just how volatile cryptocurrencies are. Critics have noted that this crash has been long-overdue, and while the bear market of 2021 saw people rushing to buy NFTs, just as many are now stuck with dwindling assets.
An evolution of utility
Beyond the FUD, the most optimistic crypto enthusiast would be inclined to agree that the heyday of NFTs may have been left behind in 2021. However, rather than holding a pessimistic view of the future of NFTs, some may view this as the natural evolution of NFTs and an opportunity to focus on their utility.
Tamas Muller, crypto expert at international broker comparison site BrokerChooser commented on what he believes is happening in the NFT market.
“In this situation, it’s no surprise that investors are moving away from riskier and more “exotic” instruments like NFTs. But we can also see that the NFT space is not totally dead; new collections are coming, and big NFT brands are working hard on new developments. Recently Yuga Labs (the company behind Bored Ape Yacht Club) successfully launched Ape Coin and came out with their metaverse called Otherside. Their effort also shows that in the current phase it’s essential to expand the utility of NFTs, adding more value to them than just the fact of their existence.”
He added:
“I’m sure that with such developments we’ll see another rise in NFT popularity in the future, but with having more utility, it might not happen in the art/fashion field like it did last time.”
The rapid rise of NFTs in the art world is an indication of just how quickly blockchain technology can grow. Going forward, the way in which NFTs create a unique and permanent record of ownership is something that can be applied to IP and the world of patents.
How long it will take before the FUD surrounding NFTs, and more broadly speaking, cryptocurrencies, disappears is uncertain. What is clear, however, is the necessity for evolution of the crypto space and a commitment to continue the innovation that led to the birth of crypto in the first place.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Source: https://cryptodaily.co.uk/2022/05/demise-nfts-oportunity-for-innovation