Think about how almost every news story seems to be about AI these days. This is a boom time for anyone involved in the industry, as politicians and companies alike strive to figure out how to harness these new opportunities and also become major players in what seems to be looking like an AI-dominated future.
It could be said that the current AI-mania is nothing compared to the way that we all got very excited about NFTs in the first few years of the 2020s. Non-fungible tokens, or NFTs, ruled the online world back then and everyone wanted to be involved. Even sports athletes are more commonly found playing for teams on highlights reels and spread betting markets sold NFTs of their greatest career moments. Everyone was swept away by this incredible new creation and the entire crypto economy received a huge boost in the process.
Fast forward just three years to today, however, and it seems there is very little said about NFTs. Crypto and blockchain technology is still a very relevant and important part of even mainstream society, but there is very little conversation surrounding NFTs. We know they haven’t gone away though. So, what is happening with NFTs right now? And are they still important?
The Rise and Fall
Perhaps it was always inevitable that the market for NFTs would crash. After the early adopters and investors had highlighted this exciting new phenomenon, millions of people all around the world wanted to get in on the action. Like any craze or fad, NFTs were sought after by people with little to no knowledge of how they worked – or the industry itself. The mania NFTs created from 2020 to 2022 was never going to last.
There are a range of reasons why the NFT market crashed, however. The innate volatility of cryptocurrency played its part, as did a series of high-profile collapses and scandals within the industry. But there were also a number of external factors that helped the crash along. The COVID-19 pandemic and the broader global economic situation affected the way NFTs were seen as well.
The Evolution of NFTs
At the beginning of the boom, just about anything vaguely NFT-related was a huge success. Huge organizations and sports leagues cashed on the opportunity to make some money from a completely new resource stream. Even after that initial gold rush, the advancements in blockchain technology made transactions faster and more attractive for investors.
Much of that excitement in mainstream society has now disappeared but that doesn’t mean that NFTs are not still a thing. As with any cultural phenomenon, people attracted by the chance of making a quick buck have disappeared. So has a lot of media attention, leaving just those really interested in the industry to keep it going. If anything, the lack of mania has improved the potential for NFTs – and the way that the industry has moved from seemingly only revolving around digital art, to include real estate, gaming, and other immersive experiences proves that there is a chance of a bright future ahead.
Challenges to Face
Although the demise of NFTs is far from a reality, it is true that there are challenges to face in the years ahead. But this is the same for any kind of business or industry, especially those operating in an online and digital sphere. Regulatory measures have undoubtedly helped NFTs (even if some of those chancers will have been forced out) and further work in this area will be needed, however challenging that may be.
There has also been a lot of talk about the environmental impact of AI and blockchain technology. This is something that will need to be addressed if NFTs are to remain relevant and important as a market. The public perception of NFTs also needs to be worked on. It is all very well for those in the know to be happy with NFTs but the general public is more skeptical after years of damaging stories.
NFTs have evolved from just being humorous digital art assets – Source: Pixabay
The Future of NFTs
The short answer is that the future of NFTs is about as positive as it is for any industry. We are living in a time of political upheaval and uncertainty and all business spheres will be affected in some way. Blockchain technology and technological advancements should actually act as a positive in this regard, however.
There are signs that more companies are looking into NFT applications and that digital assets, as a whole, can be used in a way that was inconceivable just a few years ago. The craze of the early 2020s is over but that just allows those interested in furthering NFT adoption to create new ways in which the industry can grow.
The NFT market has matured and has allowed for more serious contemplation of what is possible. More meaningful applications are now being created and that will also help battle the perception of NFTs as frivolous. How “important” NFTs are at the current time depends on how those involved in the industry push forward over the next few years. But there is room for the industry and grow to make NFTs relevant in mainstream society once again.
