NFT Market Hits $22 Billion As Craze Turns Digital Images Into Assets | Cryptocurrencies

The global market for non-fungible tokens hit $22bn (£16.5bn) this year as the craze for collections such as Bored Ape Yacht Club and Matrix avatars turned digital images into assets major investments.

NFTs have drawn similar warnings from seasoned investors to those issued about cryptocurrencies: that they are symptomatic of an unsustainable digital gold rush. NFTs confer ownership of a unique digital object – whether it’s a virtual work of art by Damien Hirst or a jacket to wear in the metaverse – to someone, even if that object can be easily copied. Ownership is recorded on a decentralized digital ledger known as a blockchain.

Data from DappRadar, a company that tracks sales, showed that NFT trades hit $22 billion in 2021, up from just $100 million in 2020, and that the bottom market capitalization of the top 100 NFTs ever issued – a measure of their collective worth – was $16.7 billion.

The most valuable NFT sale this year was The First 5000 Days, a digital collage by Beeple, the name used by American digital artist Mike Winkelmann, which sold at auction for $69.3 million in March, making it one of the most valuable works of art of all time. sold by a living artist. Another Beeple NFT, A human, sold for $29 million.

Other multi-million dollar NFTs included the Bored Ape Yacht Club, a collection of 10,000 NFTs depicted as cartoon primates that are used as profile pictures on their owners’ social media accounts and raised $26.2 million. Celebrity BAYC owners include talk show host Jimmy Fallon and rapper Post Malone.

DappRadar said a key factor in the surge in NFT commerce was the entry of mainstream companies into the fray.

Coca-Cola has raised more than $575,000 selling items such as a custom jacket to wear in the metaverse world of Decentraland while Matrix star Keanu Reeves failed to keep a straight face when an interviewer told him that his Matrix Film Series now had NFTs attached to it.

“Hollywood, sports celebrities and big name brands like Coca-Cola, Gucci, Nike and Adidas have entered the space, giving NFTs a new level of exclusivity. The power of attraction of these famous names has profoundly impacted NFTs and the blockchain industry as a whole,” DappRadar said.

Football fans have been targeted by NFT marketing – including with NFTs backed by former England players John Terry and Wayne Rooney – and warned by experts that they are risky assets, unregulated in the world. UK. It will be years before NFTs behave like a conventional market, said George Monaghan, an analyst at research firm GlobalData.

“2021 NFT activity has been frenetic. This will subside in the coming years and NFTs will settle into something closer to today’s modern art market, where consensus on value is more solid. That said, it will be years before a crypto market, let alone NFTs, is anything like what conventional markets would call stable. I wouldn’t throw your rainy day fund in yet. NFT memes,” he said.

John C. Dent