Are NFTs over or are they growing up into real assets?
Oasis are not everybody’s cup of tea (I’d rather drink cold and tasteless coffee), but Noel Gallagher got it spot on earlier this year when he described vinyl ‘as the poor man’s art collection’.
Everybody, whatever their personal financial situation, likes to be surrounded by beauty, whether it’s something they can look at, listen to or touch. Vinyl ticks all of those boxes and together with the physical (and generally very thoughtful) artwork of how it is wrapped, it’s understandable why sales are rising.
Others are being more imaginative when it comes to offering art to the people. There are few people who can afford to own a Banksy, but the Red Eight Gallery recently ‘fractionalised’ one of Banksy’s pieces of art, allowing people, and no doubt vinyl owners, the opportunity to own a piece of his Valentine’s Day Mascara piece for only £120. Smart.
After the pandemic and recent tragic events highlighting a world that seems to be on the edge, it is understandable that people have a need to be near beauty, to comfort them in times of uncertainty. It’s also a lot easier to deal with life looking into a screen and that’s why it’s personally baffling that NFTs still seem to be under some type of cloud.
Of course, there was hysteria, emphasised by Christie’s sale of Beeple’s artwork Everydays: The First 5,000 Days for more than $69 million. That was in March 2021 and seems like a completely different Time. The NFT clamour was in full swing and it looked like a surreal and infinite stampede.
Congratulations to Beeple, aka Mike Winkelmann, but there are thousands of artists (and musicians) who thought that NFTs were a way of bringing in new revenue in a completely different way. Like fractionalising a Banksy, it seemed like a perfect way to stride into the New World.
Then came the reckoning. Vastly different financial conditions with global inflation, war and interest rate rises meant those who could afford to buy expensive NFTs turned back to their turntables and put on some vinyl. The NFT recession began and it receded very, very quickly.
So are NFTs dead? Like the hyped-up metaverse, are these online status symbols and environments all washed-up with nobody to stay with?
I think not. Like all other new things, the first version is usually a flop. They are defined by what appears to be madness, such as Beeple’s sale, and then comes the data.
In September, a report from dappGambl analysed more than 73,000 NFT collections and concluded that 95% of those NFTs studied had no value. That type of data destroys a market, especially a speculative one, but that may be the point.
Like crypto, real value comes when a market matures and offers real utility, not just a tool for the Pups Of Wall Street to go gaga about. The recent surge in the Bitcoin price is not based on vapour, it’s about next year’s halving and the prospect of a Bitcoin ETF.
This is not childish speculation or greed, this is a roadmap and that’s a very different trajectory to vapour or air; it’s real land.
Something tells me that is what is also happening to NFTs. As usual, in the background, the smart ones are quietly building user cases, beautiful art and the future. NFTs are part of that future as much as the new reserve currencies of Bitcoin, Ethereum and who knows what other cryptocurrency.
Like vinyl, they will certainly make a comeback, the only question is when; in much the same way that an Oasis reunion is a certainty.
When that terrible day happens I will be under a rock grasping my computer and beloved NFTs knowing that the end of the world is truly here. Oasis. Nein. Danke.
Monty Munford advises the world’s fastest-growing companies in blockchain, AI, mobile and NFTs on growth and visibility. In the past decade his consultancy has helped more than 40 companies raise money/exit for a total of $1.4 billion.
He currently works/invests with EasyTranslate and Degen Labs.
Munford was previously a weekly tech columnist for Forbes in New York, the Telegraph in the UK and continues to write regularly for the BBC, The Economist and… CityAM.
He is also a keynote speaker/MC/moderator/interviewer and has spoken at more than 200 global events interviewing figures such as Tim Draper, the late John McAfee, Sir Tim Berners-Lee, Steve Wozniak (twice in Beirut and Vienna), Kim Kardashian (once in Armenia), Amitabh Bachchan, Ghostface Killah, ZZ Top, Guns N’ Roses and many others.