In early 2021, there was a huge hype around NFT collectible tokens. The flagship was the Crypto Punks collection, one of the first NFTs. Punks were sold for hundreds of thousands of dollars. And every day, new collections were created that tried to keep up with their success.
The term NFT has been closely associated with digital art. It’s not just pictures in the blockchain. These are real digital paintings. NFT technology has attracted many artists who have been tokenizing and auctioning their works. For many, NFT has become a new way to monetize their 3D renders and illustrations.
Of course, the market cannot grow indefinitely. As a result, the number of NFT tokens surpassed the demand. The boom has subsided and many tokens have lost value. And some of the collections that were created in a rush to catch up to the hype simply depreciated, became crypto-dummies.
The price of collectible NFT depends to a large extent on their exclusivity. And when there were too many new tokens, their uniqueness was gone: the collections are similar. There are cats, and there are dogs, or cars, for example. So what’s the point if everyone can put in a new picture and make their own collection?
But what to do with already existing collector NFT? How to keep interest in the released collections? In a few years, they’ll be forgotten and the collectors will lose money.
But NFT is not just about collecting and art.
The NFT technology is still very promising. And it can even be said that it is at an early stage of development, and there is still much to be done.
The modern world has not yet reached the stage of tokenization of real objects, although there are precedents (in Kyiv the apartment was sold in NFT). But tokenization now has no significant advantages over legal papers (especially since this is not regulated by law).
So at the moment, NFT is a universal digital asset. An asset that you can actually do anything within digital space. And it’s not limited to single collector tokens.
Crypto Kitties introduced a game with NFT tokens as early as 2017. Players can grow their SEALs, pump them, breed them, and then sell them. Token activity makes them more liquid. It is possible not only to store them on a purse, but also to increase their value by raising their characteristics.
After hype in 2017, the crypto kitties are still selling well on the Open Sea. But for the mass user, as many publications point out, the use of such services is extremely non-intuitive and difficult. BBC: Buying a pink NFT cat was a crypto nightmare
The Axie infinity project sold tokens for $42 million in June 2021. Continuing the ideas presented in Crypto Kitties, this game created a solid community and interesting in-game economy.
And the logical step for the development of the entire NFT sphere is to add activity with tokens.
There is also a trend in the creation of virtual spaces, Metaverses, where NFT tokens can be used. The main aspects of Metaverse are gaming and socialization. In fact, now it’s a lot of different projects, not really singled out in a separate sphere of industry.
In metaverses Decentraland and Sandbox users can buy virtual land in the NFT. Players can build anything on this land. Today they’re creating virtual galleries and minigames. Actually, the idea of virtual spaces is not new. Minecraft, Roblox, VR Chat have been around for many years, where you can do almost the same thing, but without a cryptocurrency. And the obvious advantage of NFT metaverses is that users are the rightful owners of their assets, with their token they can do anything, and most importantly, they can sell or transfer it safely. On this side, buying virtual land can even be seen as an investment.
But the use of NFT is not limited to this either.
With the development of VR and AR, you can literally walk through virtual spaces. The legalization of crypto assets will allow the use of NFT as evidence of ownership of real objects. More developers will add NFT to their games.
In the near future, the tokens will be gamified, more activities will be created with them. The collections will be added to the metaverses. So NFT will become closer to the mass user. It’s not just a collection thing for geeks anymore.