The Non-Fungible Token (NFT) market, once hailed as a revolutionary digital art market, has collapsed, leaving nearly all NFTs practically worthless, according to a new report. The study conducted by dappGambl analyzed 73,257 NFT collections, revealing that a staggering 69,795 of them hold no market value in Ethereum (ETH).
The hype surrounding NFTs reached its peak during the 2021/22 bull run, with monthly trading volumes reaching $2.8 billion in August 2021. News reports of million-dollar NFT deals dominated headlines, capturing the collective imagination worldwide. Photographers, hoping to cash in on the NFT craze, eagerly joined the trend.
One such photographer, Bryan Minear, embraced NFTs and successfully sold out of his NFT drop featuring five photographs within 10 minutes. This success seemed promising at the time, as Minear believed crypto was here to stay. However, the reality turned out to be far from his expectations.
In 2022, the cryptocurrency market experienced a significant downturn, leading to skepticism and caution among investors. Bitcoin and Ethereum, the leading cryptocurrencies, lost a considerable portion of their value compared to their all-time highs. Currently, Bitcoin is valued at $27,223, and Ethereum stands at $1,630.99.
The situation for NFTs is even more dire. According to dappGambl’s research, 95% of NFT collections hold no real value. This means that more than 23 million people’s investments in NFTs are now worthless. The report serves as a sobering check on the euphoria that surrounded the NFT space.
Furthermore, the lack of interest in buying new NFT assets has left artists in a difficult position. Only 21% of the identified NFT collections have full ownership, indicating that the majority of collections are collecting dust. While not all NFTs are scams, some collections are deemed remarkably stupid at best.
Melania Trump’s Man on the Moon NFT serves as an example of a complete dud. Violating NASA’s usage guidelines and featuring a public domain image, the NFT has attracted fewer than 70 buyers in nearly two months. Its $75 asking price and prospects for value appreciation seem unreasonable.
Even Canon USA, a prominent photography company, joined the NFT space late with the announcement of Cadabra, a curated photography marketplace for NFTs. However, Cadabra has yet to launch, indicating that companies are also facing challenges in this market.
While some companies, like Meta, have distanced themselves from NFTs after initial involvement, others are still trying to navigate this volatile terrain. If someone is just now entering the crypto or NFT market, they should prepare for potential calamity.
The collapse of the NFT market is not the only concern. The environmental devastation caused by crypto mining adds to the negative impact of this industry. The majority of crypto and NFT owners have accelerated climate change without significant returns.
In conclusion, the NFT market crash has rendered the majority of NFTs worthless, leaving artists and investors in a challenging position. The financial failure is just one aspect of the damage caused by this industry, and it remains uncertain what the long-term consequences will be for the crypto and NFT landscape.
