Blockchain, a relatively new technology, is already revolutionizing many aspects of our lives such as healthcare, banking and retail, among others. But there is always a heightened level of excitement when new grounds are broken. Enter the non-fungible tokens (NFTs).
Underpinned by blockchain, this form of cryptocurrency is using technology to catalog, buy and sell digital collectibles, including art, music, video games and more and is gradually drawing the attention of the decision makers in business. And while this is just beginning, the NFT market is exploding in popularity.
NFT sales continue to soar
Prior to 2021, only a small group of investors saw the potential for significant earnings in NFTs. Yet, the course of the market took a massive turn at the start of the year, and it does not seem to be slowing down anytime soon. NFTs recorded around $2.5 billion in sales already globally is poised to take a leap forward.
Blockchain Centre analyzed the Google Trends platform data and found that global interest in NFTs jumped by 426% in August 2021. The interest in Google queries for the phrase “how to buy NFT” on August 1, 2021, was 19, while at the end of the month – on August 29, 2021, the score increased to 100.
Queries for “how to buy NFT” on Google reached a score of 100, which means this is the highest volume of searches in 2021 YTD.
On July 30, 2021, Coca-Cola has auctioned its first non-fungible token collectibles as a fundraiser to commemorate International Friendship Day. Not to mention that some of the most well-known names worldwide, like Jay-Z and Katy Perry, Amitabh Bachchan also jumped into the market.
In recent months, many well-known brands are entering the NFT space, creating lucrative NFT-based consumer goods and services. Nike, Louis Vuitton and Breitling; Turner Sports, NBA, Formula 1, BBC, Warner Music, Ubisoft and Atari, are just a few examples.
“Such events, among others, are bringing NFTs into the mainstream and spurring unprecedented growth,” says Tadas Maurukas, CEO at the Blockchain Centre. Purchasing an NFT gives the investor ownership of the original digital piece. Even though the artwork can be reproduced, similarly to traditional art, most of the value remains with the original work.”
“We also see a score of 77 at the end of the first quarter. NFTs grew in popularity back then due to many high-profile sales, such as the $208,000 NBA Top Shot video clip of LeBron James, an $11.7 million 3LAU album, and a $69.3 million piece by digital artist Beeple.
These, among many other sales, opened up the doorway to even more investments, as earnings from each sale were sky-high. Some experts believe that NFTs will be one of the most profitable collectibles in the future,” he says.
NFTs gaining traction in India
Like in most cases, some regions adopt new technologies faster than others. The research reveals that Singapore is the country most interested in digital assets, with a score of 100 in August 2021. Singapore is followed by Australia (score of 86) and Nigeria (score of 70).
To ride this recent boom, several Indian players in the blockchain space have joined the NFT bandwagon. Investors also said the number of pitches from startups wanting to enter the NFT space has increased. Even large industrial houses and banks are interested in implementing NFTs.
Ajeet Khurana, a Blockchain expert, entrepreneur and angel investor sees much of enterprise gain in the NFT space. “Similar to core blockchain technology, NFTs have several business applications that are specific in their use and can help in better digital transformation,” he says.
Take for example of storing documents securely, he says, “To avoid data alteration and duplicacy, NFTs can be highly beneficial. NFTs go beyond the basic blockchain functionality of robust encryption and eliminate the risk of any data forgery or unauthorized exchange. Also, as all information of an individual and signatures is stored in an NFT, the process can be made truly paperless. Individuals who often need to present their documents for verification can carry them digitally without losing authenticity and get them verified real time.”
Vikram Rangala, CMO, ZebPay believes that NFTs are getting a lot of mainstream attention and it’s only the beginning. Rangala adds, “NFTs aren’t just for digital art and collectibles; they can store all forms of intellectual property and agreements, giving them huge potential. A lot of the other currencies are also associated with larger use cases, like decentralized finance, which has the potential to bring a lot of financial inclusion and opportunity. These are use cases that go far beyond price speculation.”
Despite several challenges, Andrew Steinwold, Managing Partner at Sfermion and an NFT expert, believes that the growth of the NFT ecosystem will only accelerate as more people and companies realize the impact that NFTs can have and implement them more.
“I suspect within five years the NFT space will look radically different than it is today,” comments Steinwold in an article on Medium.
Thanks to their unique and non-interchangeable nature, NFTs address some of the art market’s biggest and most longstanding challenges, such as authenticity and ownership. Also as Khurana notes, “The potential of NFTs, extends beyond art, and could be applied to the trading of any virtual experience or objects.”
In short, it is no surprise that non-fungible tokens are taking off on a global scale. People who were late to jump into the crypto market are hoping that this is the next big thing to turn small investments into a lot of money.
“Even though we see huge growth in popularity, NFTs are still unknown to the majority of the population. Investors see this as a massive opportunity for early adopters, as profits could be exceedingly high when these digital assets go mainstream,” says Maurakas.
With the passage of time, when NFTs become mainstream, we must see the enthusiasm is steered toward improving the lives of people, businesses and society on the whole.