Nfts
Are NFTs still viable investments in 2024?
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Non-fungible tokens (NFT) — digital assets that represent a wide range of tangible and intangible elements and are recorded on a blockchain — reached its peak a few years ago.
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At the time, they were attracting a lot of money. For example, auction house Christie’s sold digital artist Beeple’s NFT collage for $69.34 million in March 2021. Other top NFT sales in 2021 include an auction of two lots from Sothesby’s Bored Ape Yacht Club (BAYC), which realized $26.2 million for 202 NFTs.
Are NFTs still viable investments in 2024?
After explosive growth, NFT trading volumes also fell rapidly thereafter – down 97% in September 2022 from their record high of $17 billion in January 2022, as Bloomberg detailed at the time.
While NFT sales have been lagging ever since, as Benzinga According to reports, a huge sale took place in March: the CryptoPunk 3100 sold for 4,500 ETH, or $16 million.
And this, Benzinga further noted, could be the harbinger of an NFT renaissance.
“We have certainly seen the NFT market go through a boom-bust cycle, with so many PFPs focused on hype. [profile pictures] collections skyrocket, crash and never recover,” said Anthony Georgiades, general partner at Innovative capital.
However, Georgiades also noted that several quality collections have thrived and, in turn, shown that they are likely to endure for the foreseeable future.
“After all, people love digital art, so I think this aspect of NFTs will continue to show some strength,” he said.
Learn more: 13 Cheap Cryptocurrencies with the Highest Upside Potential for You
Less speculative market for NFTs right now
According to some experts, the apparent resurgence of NFTs this year is due less to speculative hype and more to meaningful, real-world applications.
“NFTs are expanding their utility beyond digital art into sectors such as gaming, real estate and digital identity, demonstrating their potential for sustainable investment opportunities,” said Lani Dizon, co- founder of Zenza Capital.
Shiti Mangahani, CEO of NFT gaming app STEPNechoed the notion above, asserting that the true value of NFTs lies in their utility.
“If you believe in a particular utility, let that guide you. But pure price speculation is never a good reason,” Mangahani added.
According to Dizon, there are several advantages to investing in NFTs: they have diverse applications, they offer proof of ownership, and they are easy to access through improved platforms.
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However, some of the drawbacks, she added, include their volatility, liquidity issues and the legal ambiguity surrounding them.
No full NFT comeback in sight, some say
On the other hand, some experts do not believe in a complete return of NFTs.
“The flood of images of dubious value will not happen again,” said Ilya Stadnik, CEO of Zent.
According to him, NFTs could, in some cases, be a good investment – provided they are carefully selected.
“I could say 99.9% of them are not worth considering. As I noted previously, the comeback is not happening, but new technologies offer hope for a transformation of the NFT market and further integration into sectors like gaming and online entertainment,” he said. added.
Reviews: Not a viable investment at all
Finally, some experts have never believed in the value of NFTs, arguing that even at their peak, they were never viable investments in the past – but rather vehicles for speculation.
“It is extremely important to distinguish between speculation and investment. Many speculators in NFTs, GameStop (or the other meme stocks) were and are engaging in speculation and not investing,” said Robert R. Johnson, a finance professor at New York University. Heider College of Business, Creighton University. “Speculators can certainly make a lot of money. But they also take on a lot of risk.
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This article was originally published on GOBankingRates.com: Are NFTs still viable investments in 2024?