Like Get Rich Schemes, NFT Hype has slowly died out, but the possibilities remain endless
2021 has been arguably the best year for the decentralized economy so far, especially for non-fungible tokens (or NFTs) which have seen a super-sonic boost in capital and adoption. Unfortunately, Google’s recent trends report indicates a sharp decline in interest in NFT, casting doubt on what could otherwise have been described as a smooth ride for the token economy.
Prior to the release of the report, many experts in the field were of the view that the NFT market was thriving mainly on hype, and debate is open as to whether the rapidly emerging economy can survive beyond this phase. of hype. Some experts advocate for people to focus on the utility that NFTs offer, as they consider this to be the best approach to creating a sustainable NFT market.
While the Google (NASDAQ:) Trends report shows a steady decline in NFT searches, one thing has remained constant; retailer interest in the space declines commensurately. According to the report, search queries for the term “NFT” have dropped to levels seen in October 2021, the same period in which the emerging industry began to attract attention on all fronts.
As stats from nonfungible, a website that tracks real-time transactions of decentralized assets such as NFTs, indicate, NFT trading volume per week has dropped significantly to less than $2,000, compared to its ATH. of nearly $6,000 recorded at the beginning of the year.
This steady decline is most clearly seen in the trading volume of OpenSea, which is arguably the largest online NFT marketplace. According to multiple reports, the platform’s NFT trading volume topped $3.5 billion in January, setting a new all-time high, but has since seen a gradual decline.
Interestingly, there are several rationales for the current downward trend in the NFT market that go beyond “diminishing hype”. Some of these concerns relate to the easing of stimulus checks in the age of the pandemic, as well as the ongoing conflict between Russia and Ukraine.
There have also been several controversies resulting from the abundance of inexperienced investors falling victim to abandoned NFT projects, after being lured by celebrities and influencers. One such case was that of Lana Rhoades, a former adult entertainment actress, who raised over $1.8 million by starting an NFT project, before quickly abandoning it.
In its justification, its actions arose from the fact that it could not guarantee that NFT prices would increase in sale value, and therefore chose to abandon the project halfway through. Rhoades is not alone in such cases, there is seemingly no end to the number of abandoned projects in the NFT space.
That said, it can be largely agreed that the majority of successes in the NFT space so far have been driven primarily by hype. But this does not end here; this leads to several questions of paramount importance. First of all, does this decline mean a major danger for the industry? Second, does the NFT ecosystem have a chance of long-term survival? And finally, is there still hope for this young industry as the hype slowly wanes?
Are NFTs really sustainable projects?
To answer the question of whether NFTs are truly sustainable, one must first answer the previous questions in the following order:
As mentioned above, Google’s search trends reports are best used for one purpose, which is to determine, among other things, retailer interest in a product based on the number of times people have viewed it. searched for and related terms online.
As such, based on Google’s report, which indicates a downward trend in interest in NFT search, there is no doubt that the retail of related products faces many forward-looking uncertainties at the future. Notably, demand for NFT and related services, as well as participation in their projects, may continue to decline if the trend continues.
However, while declining interest in search raises concerns about the future of NFT sales, it has no bearing on their usefulness. In fact, this might be the push the space needs to pay more attention to pundits’ advocacy of how important NFTs might become useful.
The truth is, since the first NFT made its public debut in 2014, most of the mainstream interest in the space has been driven by profit. As a result, the value of NFT projects is perceived as “fuzzy”, because they serve no concrete purpose other than to offer the said value attributed to them by holders and collectors, and the industry has largely evolved in following this course.
When downward search trends occur, people tend to focus more on extrapolating the actual applicability and usefulness of projects, which could ultimately drive up demand even further, with the benefit extra to encourage more projects that add technological value to the field.
- Does the NFT ecosystem have a chance of long-term survival as the hype slowly dies out? The simple answer to this question is “yes”, and the truth here is that the NFT application possibilities are endless.
It’s also important to note that beyond mere hype, NFTs have a wide range of practical uses, though many of them still need to be optimized. This is particularly evident in the growing involvement of large corporations in space.
To date, the industry has seen brands like Adidas (OTC:), McDonald’s, Ray-Ban, Nike (NYSE:), NBA, Taco Bell, Microsoft (NASDAQ:) and Coca-Cola (NYSE:), among other global brands, are dipping their toes into the NFT/metaverse world.
However, while the majority of these brands have entered the NFT space, they have barely scratched the surface in terms of the possibilities that NFTs can provide. Either way, these brands did the unexpected.
For example, sportswear giant Adidas, in December 2021, partnered with “Bored Ape Yacht Club”, gmoney and the team behind “Punks Comic” to launch its NFT project.
As a result, members of the Adidas community (i.e. customers) can access the brand’s virtual wearable collections in the metaverse game world “The Sandbox”, as well as being able to purchase the physical hoodie, gmoney’s signature orange tracksuit and beanie.
Louis Vuitton has also joined the craze, launching a themed challenge called “Louis le jeu” in February 2022. The high-fashion brand has tasked its followers with joining its popular mascot – Vivienne – in collecting 200 birthday candles. as she retraced the company’s 200-year history.
Undoubtedly, brands are increasingly using NFTs as a marketing tool, not only encouraging their consumers and target audiences to participate in NFT collections, but also involving their communities in exploring themed campaigns.
Similarly, individuals have also found their own ways to benefit from NFTs, especially in terms of promoting their skills and generating income. For example, in a recent post, we discussed how GameFi combines gaming and decentralized finance to create unique experiences that deliver value to their players, while highlighting the instrumental role NFTs play in the ecosystem.
People sign up for GameFi projects like and Alien World to compete with other players and participants to win and win NFT items, each of which can be exchanged for valuable cryptocurrencies. Of course, while this is currently one of the most attractive use cases for NFT, there are many more exciting applications in the works, just waiting to be explored, and that will be just a matter of time before they hit the public eye.
One thing is certain: the best days of NFT are yet to come, and whether current search trends are up or down, it’s hard to predict exactly what the future holds for the emerging industry.
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