SNEAK PEEK
- The “end of the NFTs hype cycle” will occur in 2023, predicts technology consulting firm Activate Consulting, based in New York.
- A year after sales peaked at $6.2 billion in August 2021, the token class only produced $1.1 billion in sales for August 2022.
- In June 2022, there were around 19,000 daily transactions with an estimated value of $13.8 million.
According to Activate Consulting, a New York-based technology consulting firm, 2023 will mark “the conclusion of the Non-Fungible Tokens (NFTs) hype cycle,” with the token class predicted to experience significant changes in how they are utilized and valued.
The token class only generated $1.1 billion in sales for August 2022, a year after sales peaked at $6.2 billion in August 2021, according to Activate’s study, which concluded that the “NFT boom is over.” The economic slump, according to Activate, would compel NFTs to adopt “more real use cases founded in proven technological and media practices,” like social networking and e-commerce.
The overall number of daily transactions decreased to about 19,000 with an estimated value of $13.8 million in June 2022, the NFT ecosystem’s poorest month of the year. This figure was last seen in June 2021.
However, daily NFT sales of a comparable amount last year were regarded as noteworthy as the developing ecosystem witnessed widespread adoption across numerous use cases.
The majority of these new NFT applications, according to Activate, will concentrate on problems that the technology has “strong justification for addressing,” like community building, rewarding customer loyalty, and legal automation for content, digital real estate, and digital collectibles.
They also see a significant change in the motivations behind user purchases of NFTs, with the token class now more commonly seen as a collectible to be displayed than as an investment.
Crypto entrepreneurs, such as Changpeng “CZ” Zhao, are assisting governments in investigating NFT use cases for identifying citizens despite the bad market. Facebook, a subsidiary of social media giant Meta, recently revealed plans to enable NFTs for creators.
Falling ETH prices, a lack of demand on the secondary market, and inflated gas expenses are some of the main elements that are affecting the buzz surrounding NFTs negatively.
