Analytics firm Nonfungible.com doesn’t expect non-fungible tokens to outperform in 2022 now that speculative fervor has died down significantly
According to a report published by Canadian analytics firm Nonfungible.com, NFT sales raked in an impressive $17.6 billion in trading volume last year.
NFTs have become the talk of the town in 2021, with high profile sales, celebrity endorsements, relentless media coverage and big brands like Visa entering the scene.
This speculative frenzy was not without backlash, with a growing community of “right-clickers” mocking people who spend fortunes on JPEGs. NFTs also attracted widespread criticism for allegedly being used for facilitating money laundering and other illegal activities. Some also argue that the prices of NFTs are distorted with the help of wash trading.
In 2020, by comparison, NFTs were a niche industry, generating a measly $82 million in transaction volume.
Their popularity exploded last March when the digital artwork of Mike Winkelmann (aka Beeple) earned $69 million at a Christie’s auction, which led to tons of media attention.
Gaming NFTs and digital lands have grown in popularity with collectibles in the last year.
Are NFTs losing their mojo?
As reported by U.Today, an ultra-rare NFT from the flagship CryptoPunk collection recently fetched a record-breaking $23.7 million.
Yet, the report also notes that NFTs could lose their luster as there are now noticeably fewer buyers in the market. The speculative fervor is probably dying down, which is why the community is shrinking.
Nonfungible.com does not expect the red-hot sector to experience any significant growth this year.
Still, average trading volumes hold up for a long time, which is why it’s safe to assume that NFTs are dying out.
Big-name investors continue piling in. NFT kingpin OpenSea recently reached a valuation of $13.3 billion.
