“The NFT Collapse Has Begun…” | Chamath Palihapitiya
NFTs, non-fungible Tokens, took the crypto world by storm in 2021, grabbing headlines everywhere and introducing the world to a brand new era of digital art and collectibles. Although NFTs have been around since 2012, they burst into the mainstream and gained huge momentum with celebrities and big brands hoping on the bandwagon, causing digital assets to have a market capitalization north of $40 billion 2021, which is up from nearly nothing in 2019. Bored Apes and CryptoPunks reported over $17 Billion in sales in 2021, but the breakthrough moment after digital artist Beeple sold an NFT artwork at Christie’s last March for $69 million. Money came pouring into the NFT space, as OpenSea, the largest digital marketplace for crypto collectibles, raised an eye-opening $330 Million dollars in early 2022, surpassing a market value of $13.3 billion following the new cash injection. The combination of sales volume, celebrity endorsement, and cash injections secured NFT’s future as the ‘next big thing’ in crypto. But according to new data from DappRadar, the honeymoon for NFTs might be over. As reported by Fortune.com, which received its data compiled from DappRadar, OpenSea’s trading volume is down 99% in just 4 months. On May 1, OpenSea processed a record $2.7 billion in NFT transactions, but on Sunday the marketplace recorded just $9.34 million worth, according to data compiled by DappRadar. The company recorded 24,020 users on Sunday, about a third fewer than when it hit its record transaction number in May. Crypto has been down across the board, with both Bitcoin and Ethereum down 57% year to date, at the time of writing with many analysts and pundits calling for a deeper decline as the Federal Reserve attempts to contain rising inflation and an uncertain economy. Declining economic climate aside, the allure of NFTs and the main narrative around it, was the ‘this time it’s different.’ Despite huge celebrity endorsements from the likes of Snoop Dog, Paris Hilton, Gary Vee, and even Melania Trump, many respected business and economic minds could not get behind the concept of NFTs and their true value. And believed it was just another FOMO bubble. Chamath Palihapitiya addressed the current state of the NFT market on his All-In Podcast essentially saying that there is nothing new under the sun and these crazed, boom-and-bust industries will always be around.
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Watch the full unedited interview here ⬇ [Credits] 🙏
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