The world is increasingly digital. In addition to that nice pair of shoes, beautiful furniture at home, and of course your laptop, you can also own a number of digital objects. You can link such a digital object to an NFT – a non-fungible token. This is an irreplaceable, digital certificate of ownership that proves that a file, located somewhere on the Internet, is owned by you.
NFTs have been around since 2015. However, only now is the time to apply them. In 2021, for example, the artist Beeple sold his digital collection ‘Everydays: the First 5000 Days’ for no less than 69 million euros and a set of 107 cartoon monkeys for 24.4 million dollars. These are considerable sums, but are these NFTs also stable in value? That is the question.
What does buying and selling digital asset NFTs mean for the future? What is ‘the future of NFTs’? In this article, we speculate on what we already know and what may come next.
Investing in NFTs can be even crazier than investing in cryptocurrencies
Investors are increasingly moving towards cryptocurrencies. Bitcoin is a well-known example of this. Due to a huge increase in value, several lucky people have won large sums of money. Sounds appealing: spending endless vacations on your private yacht, while the passive money keeps rolling in. But beware: investing is still a big risk! You can lose everything you put in… and more.
It is the same with NFTs. In fact, investing in NFTs is probably even riskier than investing in cryptocurrencies. The 2021 NFT hype is already stalling. The price of certain NFTs has even reached an initial low today. The value may drop even more, but who knows… would you take the risk?
NFT futures are likely to be very low in value
We expect the negative trend to continue for the most part. Where the supply is high, the price remains low. That may explain the rapid decline in the value of NFT. We are entering a time where it will no longer be new or unique to own NFTs. After all, there are infinite digital objects. They are not beautiful antiques with high historical value, which will be ‘used’ within a few decades. They are, or now seem, inexhaustible and certainly not scarce. You buy ownership of a photo or video here and there and maybe even a nice digital caricature. You can easily buy it from your checking account and you won’t get much more than what you paid for it. Maybe even less.
In other words, there will eventually be many NFTs with a very low value and very few with a high value. But yes: with a lot of luck and knowledge, maybe you can also take advantage of that?
Technical support for the artist of the future
It is much more likely that NFTs have a very different primary purpose than investment. Think, for example, of digital artists and other content creators. These professionals now often rely on, for example, advertisements. With the help of NFT, they also sell their artwork, photos or other content more easily. So you buy it more to support the manufacturer than for your own wallet.
If you still want to buy NFTs, look for digital items that have real value to you. How about special collectibles like the first tweet from your favorite musician? If your property doesn’t go up in price, at least you have a special story. Such an NFT may not have great financial value, but it does have emotional value.
High value NFTs probably already forgiven
There may still be digital objects that retain their value, for example, because they are not immediately visible to everyone. Or because they contain important information about our society. Are you interested in the source code of the World Wide Web? In that case, bad news: unfortunately that is already forgiven.
That goes for more NFTs that can hold their value. Feel free to explore options, but it may already be too late. And even then it’s still a big bet and you just have to have the right amount. Choose wisely!