NFT is a hit "thing" among cryptocurrency investors. Ongoing trades with the asset could reach $2 billion per month. However, some experts acknowledged this might be an unsustainable NFT bubble.
For others, NFT is a sign of crypto adaptation.
Should you invest in NFT? Cryptocurrency markets have made steady gains over these last couple of months, and one of the biggest beneficiaries is definitely the non-fungible tokens or NFTs.
For reference, NFT is a unit of data stored on the blockchain which can be traded or sold. NFT also acts as "ownership rights" over some unique digital assets like art and music. Up to date, several content creators gained massive profits by selling new works as NFT. Crypto fans are also enjoying the trend of these newfound digital collectibles.
NFT Bubble: Fan Crypto Hype
It is worth noting that the biggest strength of NFTs lies in fan hype. The more fans invest in digital collectibles, the higher their value and pricing get.
According to DappRadar, NFT sales roughly reach up to $2 billion per month, up by $400 million compared to market performance in January. NFT volume also skyrocketed to 38,000 percent year-over-year, with a jaw-dropping $10.7 billion gain in the third quarter this year.
Since fan hype fueled most of this market boom, some investors feel skeptical of the NFT momentum. They informally call it a bubble, implying a very dangerous market that can burst at any moment.
NFT Prediction: Experts Drop Good News for Crypto Fans
However, NFT might have a stronger foundation than it is given credit for. This week, Art Basel and nearly 200 other blockchain events in the city showcased NFTs and their unique advantages. CNBC recorded a few comments from NFT supporters.
According to Mike Shinoda, a musician, and co-founder of Linkin Park, NFT brought a lot of hype. He joined in the fun and even launched an NFT mixtape in the market. He said, "most people believe there's some version of a bubble happening. But most of us who are in the space think that whether it goes up or down, it's a new thing that's here to stay in some version of itself."
Another strong supporter is Tristan Yver, the head of strategy at Miami-based FTX U.S. He emphasized that NFT has a lot of potential, even if it is overvalued in the market. "We all have some basic understanding of art. We don't all have a basic understanding of cryptocurrencies and blockchain - it's the next step towards mass adoption. NFTs are the first time a lot of people create a connection with cryptocurrency and blockchain."
Lastly, Packy McCormick, the founder of Not Boring Capital, pointed out that NFT is here to stay. "There's going to be a ton of people coming in to speculate. But the important projects will have staying power and over time, quality will win."
These investors all saw market potential for NFTs in the long run, so investors might want to watch out for its progress in the coming months.