Are NFT collectibles the new trading cards or a hype bubble soon to burst?
NFTs (non-fungible tokens) have become a hot commodity lately, with artists, musicians, sportspeople, and even entrepreneurs making millions trading them. But are they overhyped and will the NFT bubble soon burst?
Non-fungible tokens are used to verify unique items such as digital art and digital ownership of other items. Now, NFTs can be used to verify ownership of physical items.
Several stories have recently caught my eye, as companies scramble to lead the way with unusual NFT sales and auctions. But do Americans view the emerging concept of NFTs positively, or do they think the impact on climate change means that celebrities should act responsibly when offering NFTs for sale?
Celebrities such as Jack Dorsey, Beeple, and the Kings of Leon seem to be betting big on NFTs, and many other companies are offering NFTs for sale or auction across the blockchain:
Some brands have indicated that they are moving toward 3D avatar technology to create digital clothes to try to make fashion more eco-friendly and sustainable. This NFT content for sale will include GIFs, pixel art, MP4s, and a static image of Shudu. A portion of the proceeds will go toward supporting Black Girls Code.
UK clothing brand Overpriced has partnered with Blockparty.co to combine NFT's with real-world clothing items, using scannable V code-based art.
The company launches the NFT of its season one line-up on April 12. Its first item, a hoodie, will be offered at an eye-watering $25,000. Here the NFT is "merely a digital receipt of purchase for a physical purchase" of its fashion apparel line.
Even auction houses like Phillips are offering NFTs. The company is holding an NFT auction by artist Michah Dowbak aka Mad Dog Jones. This particular NFT will replicate itself every 28 days to produce new generations of NFTs. Bidding for this auction will start on April 12.
The research showed that over two in five Americans (42%) and almost three in five (59%) of Brits are not aware of NFTs at all.
Three in five American respondents (59%) think that NFTs are the future, compared to two in five (39%) UK respondents.
Almost two in five (38%) of Gen Zers in the US think NFTs are just a fad as compared to 33% of Gen Xers and 28% of millennials.
When asked about the environmental impact of transacting on the blockchain and cryptocurrency's and therefore NFTs contribution to global warming, over three in five (62%) and 57% of millennials in the US and the UK think celebrities should act responsibly given cryptocurrency's environmental impact -- the highest score amongst all ages.
A quarter of respondents said that they were not aware of cryptocurrency's environmental impact.
It does seem that the US is leading the charge with NFTs enthusiasm at the moment. Awareness of the concept is low and uncertainty about NFTs is felt by a quarter of respondents (23% Americans and 28% British respondents).
One in five (18%) Americans and one in three British respondents (33%) do believe that NFTs are a bubble that will burst soon.
As a Brit, I'm firmly in the skeptical camp, believing the NFT bubble will burst one day. I prefer to own traditional tangible assets that I can hold in my hands.
I am not certain that a digital token -- no matter how valuable, would give me as much joy as a real item of clothing, a car, or some jewelry. If you have made a significant amount of earnings from your NFTs, you might, of course, disagree.
Disclosure: I have an account on blockchain social media platform Twetch, which has earned $36 from posts made on the platform since October 2019. I use these funds to pay to post and like other posts on the platform. I have never purchased, sold, or traded any type of bitcoin and I do not own any NTFs.