NFTs had a huge bull run two years ago, with billions of dollars per month in trading volume, but now most have crashed to zero, a study found.
Remember when NFTs sold for millions of dollars? 95% of the digital collectibles are now probably worthless.::NFTs had a huge bull run two years ago, with billions of dollars per month in trading volume, but now most have crashed to zero, a study found.
Their so-called "value" was always determined by the ability of the person shilling it to make up bullshit. Literally the definition of a "confidence" game. Same problem as crypto in general. It's only has value if you have confidence in the person shilling it. The moment that person loses the confidence of their marks, the entire thing crumbles to nothing because it isn't backed by any real tangible assets.
Sure, but some systems are way more stable since they are established and have the general trust of a lot of people. And others simply don't have that wide ranging trust and as such aren't stable.
Real currency is backed by assets. that used to be the "gold standard", but has become more ephemeral since the end of the first world war.
A government issued currency is backed by that government's infrastructure, taxes, tariffs, etc... basically how powerful that government is on the world stage.
in contrast, crypto is backed by nothing more than how persuasive the creator is because the creator doesn't need any assets to create a crypto currency in the first place.
Heck, in one case, some techbro created a crypto currency, and convinced a bunch of people that it would be stable because he was backing it with ANOTHER crypto currency he literally created for that only purpose.
And people FELL FOR IT!
When something can be created out of thin air with no assets needed but a GPU, it's inherently worthless.
Edit: Idk why all yall turds down voted me. The u.s. dollar is literally not backed by any physical asset..... look up fiat money and do research on the dollar.
We have been attributing a huge value to a metal that's mostly remarkable for being yellow and shinny for millennia, one of the biggest investment bubbles in history was over a flower, and people thought that using a loophole to profit from the arbitrage of international reply coupons was going to last forever. Hell, people paid for fake property titles for land on the Moon and Mars. It's not that surprising that some people think that buying a random number in a distributed database is an investment.
Things only have a price when two people are willing to do the transaction.
Say 99% of NFT owners have given up and mentally written off their NFTs as a complete loss. If the remaining 1% are selling at a 90% loss and some sucker is still buying at that 90% discount, the "average price" will be whatever those two agree on.
This is a bit different from physical goods because those can't just be deleted out of existence. If someone had a warehouse of beanie babies they might choose to give them away (setting the price at zero) or maybe there's some tiny value of the cloth so they sell them for a few cents per kg.
I like how the url could also have the picture changed if someone wanted to lol. You don't even own the picture that the url points to, you just have a receipt that says "this url is my url, no I don't own the url, because someone can change what's on that. No I also don't own whatever is hosted on that url either"
And the receipt isn't necessarily unique. The centralized world of Web 3 decided mostly to use Opensea(?) for NFTs, but it isn't the authority on who owns URLs. It's just the biggest, most commonly used "star registry" that let people claim that they owned certain stars. But, the same "stars" could be sold by other people on other platforms too.
They literally provide no value. I don't see how people didn't get that.
It's a link, you bought a link. If the power goes out at the server hosting it, you can't even access it anymore.
If I told you I had a magic box, and for a million dollars you could look inside whenever you wanted, you'd tell me to go fuck myself. But do it on the Internet and it's beanie babies all over again. But at least THOSE were tangible.
Never work in tech, friend. It is an endless parade of buzzwords. Idiots will think it is a revolution, people who put even the smallest amount of effort into understanding it will know it isn't. Sadly, the idiots tend to be the ones making the decisions. So you get to spin your wheels on a fool's errand until their surprisingly lengthy attention span moves to the next buzzword. As the parade continues you just lose more and more faith in humanity.
I wish I had an answer for you other than some people are really fucking stupid.
Depends what they are. I have a bunch of NFTS and they have all mostly held their value or increased. The difference is they are all related to games, and the most I have ever paid for one was probably like $15, with the average being like 50 cents. This only seems to be looking mostly at art NFTs on ethereum networks. I don't have a single NFT that uses ethereum, although I know that was the craze, especially for "investments". Which anyone with half a brain should have been able to tell someone an NFT is not a good investment plan.
Frankly that says more about the gullibility of gamers than the legitimacy of NFT. Gamers will pay for the chance of getting access a fictional character in a game that will eventually close its servers and take everything down with it. They can't seem to differentiate the value of something within the fictional ludic context and the value of something as a piece of media or an entertainment product, and gaming/tech businessmen these days take full advantage of that oversight.
Does anyone else think that NFTs are an allegory/miniature version of how art is easily commodified by capitalism? IIRC, NFTs were there to help finance artists who work on a purely digital medium, but then grifters coopted the NFT space and try to sell sets of same-looking artwork. Complete with "fandoms" and drama, as well.
NFTs are simply a straightforward con, without the financial hullabaloo of cryptocurrency. The con is simple: convince someone that something is valuable when it's not. Selling a brass ring as gold to a mark too naïve to check, has been around as long as there have been gold rings.
Nah, NFTs were always about the grift first and the art second.
After all, all an NFT token is is a digital receipt which links to an image hosted somewhere off-chain, not the image itself. All the "art" does is help to persuade people that the tokens are actually worth something and hype up the price even further.
It is an allegory for the whole financial system ... it's all made up imaginary money, funds and amounts that don't exist and never will .... it's all based on trust, faith and belief. If enough people wake up tomorrow and stop believing in a segment of this entire system, it can all quickly collapse.
I remember reading about ten years ago that if all debt was stopped all over the world and all of it was to be repaid ... it would take the world several million years to do so.
There is wealth in the world but we've created very complicated, imaginary ways to make it seem that wealth is worth millions of times more than there actually exists.
I see it as a modern day religion ... it exists because we all believe in it .... if the faithful ever lose faith, the religion dies.
IIRC, NFTs were there to help finance artists who work on a purely digital medium
That's not true at all. They were a con from their inception. The "helping artists" bit was something they made up to further that con. Just like when they claim cryptocurrency is an actual viable currency alternative to fiat.
Yeah it was huge in the art world, all the art magazines had articles about how it was the next big thing and how to mint your own nfts - which of course all turned out to be 'pay my buddy $200 and we'll turn your jpg into an nft!' which was a scam within a scam.
Artists generally aren't tech minded and honestly often pretty surface level in their understanding of things because that's where their focus is, they're looking at the visual not the mechanical. There's nothing wrong in that because life needs a wide range of people.
NFTs were there to help finance artists who work on a purely digital medium, but then grifters coopted the NFT space and try to sell sets of same-looking artwork.
I'm curious if you have a source for this. I haven't heard it anywhere else...
That's why it's at the time. I made a quick $600 and never looked back cuz I knew it was unstable, but I wasn't ignorant to the idea like many people who just wanted to bandwagon hate.
Ignorant to the idea? The idea was basically a spreadsheet with links to PNGs and """"owner"""" of that PNG. Blockchain only means nobody owns the sheet itself, but that doesn't make it any less ridiculous.
Weren't those not even nfts? I believe I remember reading that they were basically just jpegs or something to that effect. Makes sense though, better return of investment on that scam.
I find it fascinating that NFTs were supposed to be a proof-of-ownership technology, but because people are stupid & greedy made pictures to sell with it
At the very core ownership that isn't recognised by the state is meaningless. So that ape picture? No one really cares about some guy claiming to own it because they have control over the token. As long as it's on the internet everyone can just copy it and there's no authority caring about it one bit since NFT isn't recognised as for example copyright is.
Even when it comes to stuff like items in games, these also are only worth anything as long as the publisher of the game recognises your claim to it! And even if they did recognise it, there's absolutely nothing preventing them from changing their minds later. Simply because they create the game however they like and have 100% control over it's development.
What confused the fuck outta me as someone who has been in the crypto space since 2010 is that it wasn't new or novel in any way. Colored Coins was virtually the same thing and it flopped in a similar fashion and there were several similar projects that did the same or never made it off the ground. Then, some shitty monkey drawings come along, are backed by virtually the same thing I had seen before and suddenly people I knew from my hometown who barely had two brain cells to rub together were claiming to be financial and tech gurus while peppering "block chain" into conversation. The one thing that brings me solace is that they all lost their investments
Right, when NFT’s we’re going crazy, the pictures and shit didn’t make sense to me at all but there’s a huge opportunity for digital ownership of physical materials like cars or houses. It would make private sales/transfers easy. All title information on the house would be recorded and attached in the blockchain so when you go to sell your home, you can prove there aren’t any liens against the home and once financing has been approved, transfer the ownership on the blockchain and done. That’s where I always saw the practical application going but now nobody will take NFT’s seriously until it’s named something else and rolled out with government approval and systems in place or nobody will feel safe transferring such a large investment digitally
but because people are stupid & greedy made pictures to sell with it
Can you blame them? If I gave someone a photo and then they offered to give me $1,000 if I also would write down a unique number, then I would without hesitation write down a random number and get my grand.
I feel like a lot of people probably knew that to some degree, but didn't want to believe it to be true. Supposed to leave your emotions at the door when trading stocks or crypto, but a lot of people don't seem to do that.
Yup. Does feel good to be vindicated for being willing to honestly express reality, in spite of willful delusion and ingnorance. Not that I am happy for those that suffered immense losses but, they can't say that they weren't warned.
All those rappers and celebrities with cartoon donkey and monkey profile pics showed how much for sale they are. They will promote poison to you for money
Or they'll promote just silly pictures for people with lots of money. They don't owe you an education in investing. If they paid lots for a NFT that's not an issue, you don't have to.
It's no different in someone buying Gucci on minimum wage because a Kardashian wears it.
Except, much like crypto, they were heavily marketed to be just like stocks and other legitimate securities (but the future, because internet stocks!), instead of just speculative gambling on completely unregulated assets. Sure, you could do a modicum of research and see that they did include in the fine print they were explicitly NOT regulated securities, but your Average Joe has no clue what that means and just sees someone he trusts (don't ask me why, but people absolutely do), telling him he'll be super rich if he buys some C-list celebrity's monkey JPEG.
Do I still think people like Average Joe are idiots for buying them? 100%. But that doesn't make it okay that people are taking advantage of their financial naiveté either.
More like Bullshit run. Literally nobody fell for the grift. Celebrities bought into it because it was a pump and dump scheme and they can afford it. There is literally no use case for NFTs and even basic normies saw that.
Someone somewhere has an NFT instead of a bunch of money. Even if everyone participating knew this was a very expensive game of hot potato someone had to be holding the potato when the buzzer went off.
Yeah, a lot of the NFT craze was pump and dump where people were selling NFTs to themselves. Even that famous digital artist who got super rich did it because the guy who paid him was trying to inflate the market. But, like any con game, there are suckers. Many of them aren't rich, just stupid.
The use case for NFTs is to provide a bulletproof cryptographically secured registry for arbitrary content. Such as deeds or titles. Legally recognized, that would represent a marked improvement on the current system. You can have it represent digital goods also, that's just more of a toy than a useful tool.
I'd say there's a fair number of people just speculating.
And a couple people get lucky and make it big. And that's promoted. Cuz it looks great.
But like a lot of the big movements, are money laundering as you said, or a way to bribe people. This politicians wife's cousins son sold an NFT for 4 million that's amazing!
But we get this with traditional art too. Any market where there isn't commodity pricing, price discovery is flexible, so it can be used for lots of social reasons
Isn't most art for money laundering. You move money and purchase a piece or "art" for 4 million. Art isn't worth it. But because it's been bought it now has a value. If you sell it. Now you've created money from nothing. Fucked up
I still think NFTs could be used to make a form of DRM that is actually fair to the consumer, by maki g it so you can resell your digital goods and also make it so your digital rights don't vanish as soon as the seller gets bored. But nobody in a position to make that happen wants that.
DRM as a concept seeks to limit your digital rights. Any DRM of any kind is a form of punishment to the consumer. You bought it, it should be yours to do with in perpetuity as you please.
What about the rights of the creator and fair compensation? That argument alone is driving the entire backlash against AI and AI created art whereby people's work was read and incorporated in some level without restriction, why not here too?
DRM could be fair to the consumer, it just isn't in the interests of the publishers to make it so, and as a result the versions of it we have are not fair to the consumer.
Okay but what happens when the platform goes away, or decides to change the rules? That`s the only part I could see NFTs actually potentially answering. If the ownership verification was all done client-side via a blockchain it could potentially survive the shutdown of the store you bought it from.
Don't get me wrong, I can see problems with this. And potentially this could also be done with simple public key cryptography.
How would that be fair? There would still be drm running on your computer to verify you have the nft. That would have all the issues of DRM already. And those who want information to be free could still just make illegal cracked copies and distribute them.
How is it unfair? To me fair means making sure the creator gets paid without stomping on the rights of the purchaser; in particular, the right to keep the thing after the publisher has gotten bored of selling it, and the right to sell it, though that last one is a difficult proposition with digital goods, seeing as they don't devalue.
Video game ownership rights have been going downhill for years. Most games can disappear from your account at a whim, and you can't sell them on when you're done anymore. At least with blockchain-based DRM, you'd be able to sell it when you're done - and if the thing is hosted in a decentralized manner (IPFS, Pinata etc) then the creator can't simply delete it or delist it. You'd own it without permission.
It is theoretically possible to make a system that would let people make personal copies of software, songs etc for backup purposes and do all the other things they should be able to do with something they have bought, without letting them give copies to everyone for free or otherwise go into competition with the creator without doing any work themselves. Just no such system has been made because publishers want an unfair system.
It was what for like 5 minutes during a year with a million other more important things going on to pay attention to that thing that kids with only somewhat rich parents used to try and scam their way to being as rich as the kids with really rich parents.
That's exactly what it was. If I wanted to wash money, the easiest way to do it would be to create some bullshit digital pic and then buy it myself from an alt dummy account.
GOT EM! They were all confused and excited that it might be the next Bitcoin..All I need is one good con like this and I can get off this fucking hamster wheel!!
Clever assholes convinced fools that they had "the next big thing". The "smarter fools" realized the problem and offloaded their losses onto greater fools, a considerable portion of which are now wondering how to catch an even greater fool than themselves.
What happened to the influencer guy. He started out selling alcohol or something and then had random videos where he bamboozes someone doing a house clearance and got excited for making 36 dollars off a box of toys, then went on to shill the ever fuck of fungible tokens, it's the future.
I'm just gonna plug The Great Crash 1929 by John Kenneth Galbraith. Really clear, funny, sarcastic writing that is highly relevant here. The kind of economics I wish there was a whole lot more of; the Samuelson program with its assumptions of rationality and perfect knowledge has been a disaster.
The chapter about asset bubbles obviously, but there's also a chapter about the historical catchphrases of London that shows that circlejerk shitposting has always been part of humanity... Yesteryear's "What a perfectly dreadful hat" is today's Stroganoff.
What is today's Stroganoff? This is like the third time I've heard a reference to Stroganoff this week, but they don't seem connected, just like everyone's talking about Stroganoff all of a sudden.
During the shitcoin hype, bought $100 chunks of various projects. Only 1 coin 🚀 to the moon for a nice $20K profit (it crashed 2-3 weeks after selling). If it had shed another 0, would have had a nice chunk of money.
Yeah, it was a bubble. Dot com companies were worth less than investors hoped, but not worthless.
Many of the dot-com companies that survived the crash exceeded their bubble valuation. Amazon, for example is worth far more than it ever was in the bubble days. Same with eBay, Priceline, etc.
Yahoo is widely considered one of the biggest flops, but it survived the dot-com crash, dropped to just a few dollars a share, then eventually climbed back up over $40/share. Despite being massively overvalued in the bubble and then massively mismanaged after, it fundamentally had some value and people used it for years.
Why does everyone need to point out how “they were always worthless”? It’s a collector’s “item”, it only has value if someone wants to buy it, nothing new.
The only difference is that this one’s value if the market completely crashes is absolute zero, but does that change much if regular collectible items are physical and can be sold for 1 cent instead?
I never bought NFTs and never will, but as a collector this pisses me off because it’s the same as those people who mock card collections because “it’s just cardboard”. You’re completely missing the point.
If I buy a lot of baseball cards for 1 cent, at least they don't suffer from the oracle paradox.
NFT's were nakedly a solution in search of a problem that weren't even a very good solution to the problem they were purporting to solve. That's what pisses people off.
Sorry, I tried to understand this Oracle Paradox you’re talking about but every explanation I found had so much jargon that it fried my brain at the third line. Do you know where can I find an ELI5?
And yes, I get why people dislike the concept of NFTs, but mocking their value (or lack thereof) seems dumb when it’s “obtained” the same way as pretty much every other collectible.
That was only the first wave of NFTs, it's normal for this to happen with any technology. The oldest first generation of televisions and radios also became worthless as newer better ones came out. The next generation of NFTs is going to be more impressive and earn even more profits for their creators, mark my words. If anybody wants to get in on the ground floor of NGNFT (next gen NFT) drop me a line and I can help you make 1000x your initial investment.
I mean in your hypothetical their options would be to either spend effort to send you something worthless or not spend the effort and experience zero difference on their end.
What's with the downvotes? They are trading for ~$80k a piece currently and have been around since 2017. I'm not saying it's a solid investment, far from it actually. But I don't believe they will be "worthless" any time soon.
Yes, its largely inexpensive to spin up a new batch of collectibles, so the vast majority of them are indeed worthless because anyone can just make one.
The small handful that are actually collected by the public at large and are considered worth something... continue to be worth something.
It's like grouping thousands of meaningless mass produced collectable trading cards made by game companies that no one actually gives a shit about, in with the likes of MTG/Pokemon/Hockey/Baseball/etc
Like yeah if you look at it as a whole, no one gives a shit about 99% of them, because its literally just ink on paper, so its not exactly that hard to shit out yet another "collectible" no one cares about.
But the public will latch onto the very small handful that actually hold some form of appeal, and those will absolutely continue to hold value.
99.9% of Magic the Gathering cards aren't worth the ink and paper they are made of.
Doesnt have any bearing on whether your mint condition Black Lotus is worth $$$$
As far as I know, the "MTG" or "Baseball/Hockey" cards of NFT backed images continues to be bored apes and crypto punks. The consistently stay at the top by volume and make up very large portions of trade volume each month.
I couldn't tell you what the "Black Lotus" is of those collections as I don't actually care that much about Image NFT trading, I know of it but Im not like, integrated with the community. Im sure there are a handful of items that are prized though.
Overall, this study and article imo just confirms Sturgeon's revelation and thats about it.
It's about as useful as saying that 90% of websites on the internet continue to be crap, or that 90% of youtube channels aren't popular.
Doesn't matter because the top 1% are all people really care about anyways, and the nuggets of value naturally float to the top through market selection.
It's another to ignorantly ignore the indisputable fact that hundreds of millions of dollars worth of transactions happen every month, and the market caps for each collection are easy to look up.
Last 24h alone, as of writing this post, Bored Apes alone had almost 1.8 million dollars in transactions.
I don't even collect nfts myself but I'm not going to deny the tens of billions of dollars that move around on that platform this year.
Is it less than 2021? Oh God yes, way lower, major cooling off.
But calling billions of dollars moving around "dead" is foolish at best.