NFT bloat results in a lot of dead mints, says new blockchain data

Between January 2021 and February 2022, the number of minted collections rose from 39,802 to 1,970,886. That’s a staggering 4,800% expansion.

NFTs couldn’t have gotten much frothier last year, and recent data suggests the bubbly is still flowing—despite, perhaps, fizzling too.

That’s as a third of NFTs minted since January 2021 have become “dead collections, with little or no trade activity post-minting,” reports blockchain analytics firm Nansen, which surveyed roughly 8,400 collections comprised of more than 19 million NFTs on the Ethereum blockchain. Meanwhile, another third of NFTs are trading below the initial cost of minting the tokens (the price it’s first sold at, plus a so-called “gas” tax associated with NFT transactions.)

The last third are trading at a higher floor price than the cost of minting. Those would presumably be the NFTs making up the volume by which one in five minters realize a profit, according to a statistic from blockchain data firm Chainalysis. However, it’s likely those profits will grow more elusive as time marches on. Between January 2021 and February 2022, the number of minted collections rose from 39,802 to 1,970,886—which is a swell of 4,800%, reports Nansen. Despite buyers’ get-rich-quick stories and hustle culture, the NFT racket can’t possibly make millionaires out of all of them.

“NFT minting is increasingly competitive with more projects being introduced to the market,” says Nansen.

In some ways, that’s helped erode barriers to the space: For example, it’s pushed down the average cost of minting from a peak of 0.56 ETH, in May 2021, to between 0.07 ETH and 0.1 ETH. But it also means the space is far more crowded for minters looking to make a buck: The community of NFT minters has multiplied from 500 people, in January 2021, to 1.2 million at the end of last month. Most seem to be dabblers, with the vast majority spending less than 0.5 ETH (approximately $1,700) on mints. Meanwhile, the proportion of so-called whale minters spending over 100 ETH has lessened.

BELIEVE THE FATIGUE, NOT THE HYPE

The NFT bloat is perhaps fatiguing the hype. According to Google data, search interest in NFTs peaked at the new year before falling steeply. But despite that, according to Nansen, minting activity is stronger than ever with minters spending more on NFTs and gas fees this year than last year, led by a blockbuster Pixelmon project that rivaled hauls for Meebits and Mutant Ape Yacht Club launches in 2021. (Those investors ultimately lost millions when the collection flopped.) The overall rise in activity is likely driven by the explosion of unique minters, says Nansen.

But is all of this a good thing? Crucially, the payoff for a minter has trended downward over time: In January and April of last year, average profits hit highs of over 90 ETH per collection per month, and at one point reached 115 ETH. However, they have since dropped and remained mostly below 20 ETH.

And while events in Ukraine and Russia have cooled the market lately, even beyond the short-term ebb and flow, some in the industry have expressed concern over where it’s heading.

“Money is flowing too fast and too ignorant into the space,” Whaleshark, the pseudonym for somebody thought to be one of the largest NFT holders in the world, told Bloomberg. “In the current market, it’s a pump-and-dump cycle among PFPs [profile pictures] which is why this is leading to a decrease in the market,” said the investor, referencing a popular form of NFTs that often end up a flash in the pan as secondary market values plunge. “Not enough new money coming in to support PFP projects . . . [It’s] similar to a pyramid scheme.”

Article Credit : Connie Lin / FastCompany

3 Ways to Make Money with Non-Fungible Tokens (NFTs)

From celebrities to respected companies, everyone is talking about launching their own NFTs. But not all NFTs are made equal: while some are worth a fortune, some can be worthless.

There’s no doubt that Non-Fungible Tokens are the most popular trend in the crypto community right now. From celebrities to respected companies, everyone is talking about launching their own NFTs. But not all NFTs are made equal: while some are worth a fortune, some can be practically worthless. Let’s take a look at some of the most profitable ways individuals and companies are making money during the current NFT gold rush.

1. Digital Works of Art

When it comes to sheer profitability, individual NFT artworks are by far the most valuable Non-Fungible Tokens ever created. 

On March 11th, the history of blockchain technology and the history of art changed forever. Christie’s, one of the most renowned auction houses in the world, sold an NFT work of art for $69 million. It was the first time when Christie’s auctioned a fully digital artwork.

The piece entitled “Everydays: The First 5000 Days” was created by a digital artist Mike Winkelmann, better known as Beeple. The NFT is not a single artwork but a collage of 5000 tokenized images which Beeple was creating every day over the course of years.

While some people are already raising concerns that selling what is essentially a link to a picture for millions of dollars could be just a front for money laundering, others believe that NFTs are a true revolution in the world of art. 

The record-breaking price set by Beeple’s NFT may soon be surpassed. After all, Beeple was, until very recently, a completely unknown artist. If someone like Banksy decides to auction an NFT work of art, the price would likely be much higher than $69 million.

2. Licensed Collectibles

Tokenizing collectibles seems like the most natural and obvious application of the Non-Fungible Token technology. The brands which were already selling physical collectibles such as trading cards can now also sell the same thing in a digital form. Since NFTs have provable rarity, the price of a digital trading card can be much higher than the price of its physical counterpart.

So far, sports cards are by far the most popular type of licensed NFT collectibles. The first NFT sports cards project allowed people to trade licensed cards of footballers, but recently the NBA has also launched its NFT cards collection. It’s very likely that other sports organizations will soon follow, and collectors will be able to buy baseball or hockey NFT cards as well. 

But sports cards are just one example of what NFTs can be used for. Any physical collectible can also be turned into a Non-Fungible Tokens. While physical trading cards are easily damageable, NFTs can be securely stored on the blockchain, and they will never lose quality.

3. NFT Video Games 

The NFT-based video games could very well be the future of NFT technology. So far, none of the games utilizing Non-Fungible Tokens managed to gain widespread popularity, but the potential of applying NFTs to video games seems tremendous. 

Gamers are already known to spend fortunes on virtual items. World of Warcraft gold, Call of Duty loot boxes or Counter Strike skins—all of these markets are already worth billions. If any major video game company decides to sell in-game items as NFTs, the impact of such a decision on both gaming and blockchain ecosystems would be tremendous.

It’s also worth noting that NFT video game developers are among the most ambitious Non-Fungible Token creators, and NFT in-game items might push the evolution of Non-Fungible Technology forward.

Compared to simple digital trading cards, or even to more interactive NFTs like virtual works of art, in-game NFTs are by far the most advanced. Non-Fungible Tokens utilized in video games can be very complex, fully interactive, and they can change over time, for example, by being upgraded or by leveling up along with the player’s character.

Non-Fungible Future

Non-Fungible Tokens are much more than just another quickly passing crypto trend. The NFT technology has many unique applications, and the full potential of NFTs is only beginning to be explored. 

It seems like the NFT gold rush is only starting as more and more individuals and businesses decide to enter the Non-Fungible Token ecosystem. The fact that the most popular NFTs are still simple images suggests that the market is still very undervalued – the true eruption in NFT popularity might not begin until complex Non-Fungible Tokens exploring the full potential of the new technology become more popular.

Article credit : Kevin Leyes / Entrepreneur.com

Singaporean-based influencer makes US$5.58 million from NFTs in 10 days

When your selfie game is too strong.

The possibilities of non-fungible tokens (NFTs) has taken the world by storm. And this case is no different. Singapore-based influencer Irene Zhao has garnered over US$5.58 million (S$7.5 million) in 10 days through NFT sales alone.

The NFTs consist of images of her with meme slang texts over a mint green background. Though similar in nature, the NFTs have gained a lot of sales and are listed on OpenSea, amounting to 1,107 items under the IreneDAO collection.

The collection, launched on January 14, 2022, has a total trade volume of 2,300 Ethereum, which is equivalent to around US$5.58 million (S$7.5 million).

When crypto meets Simps.

The images were originally a sticker pack on Telegram, but a suggestion from a fan to turn them into an NFT collection changed the course of these images.

Together with her business partner Benjamin Tang, Zhao created the IreneDAO NFTs, aiming to build “Social Collectibles”, or “So-Col” for short. So-Col serves as a decentralized social networking platform, through which content creators can convert their social media content into non-fungible collectible items.

The money made from sales will be used for the IreneDAO community in hopes of experimenting the best way to integrate Web3 into the creator economy. The wordplay that is the community’s core values are SIMP: Simplicity, Integrity, Meaning, and Purpose. Unsurprisingly, the sales for particular NFTs are driven by people who well… simp for others.

Nevertheless, the IreneDAO community is a grassroots movement that is “for the people, by the people”. Purchase of the NFTs will also get the buyer membership to IreneDAO’s “Genesis Tribe”.

A change for influencers.

With a following of over 380,000 on Instagram, Zhao explained that it had not always been easy. Having started her influencer journey back from her university days, she had to rely on sponsored content to make money. Her social media posts would often feature product placements, something which she said her followers did not like, but she couldn’t help as she had to feed herself somehow.

In her Twitter thread, she defends NFTs, explaining that they are a way for creators to truly own their content, which followers can also buy a share in and invest.

Article Credit : Anne Nunis / Mashable

Man sells NFT of a trashcan for a whopping US$250,000

One man’s trash is another man’s art.

An American artist has managed to sell an animated image of a trashcan as a non-fungible token (NFT) for the price of a staggering US$250,000 – simply proving again how absurd the prices of digital decentralized art can, and will probably continue to be.

Just recently, the artist going by the pseudonym Robness explained how he took an image of a trashcan he got from the internet and spiced it up with glitchy, psychedelic effects and uploaded it for sale on the NFT platform SuperRare.

The art piece named 64 Gallon Toter had been uploaded a couple of years back, but had been removed from the platform for apparently infringing upon another company’s copyright.

Speaking to AFP, Robness explained that the trashcan artpiece was originally created as “rage art”, and an outlet for him to express his anger at a bunch of things in life.

“I put that up, and it was removed,” he said. “They thought I was taking Home Depot’s picture and breaking copyright. They threatened me legally.”

But to his surprise, the image was reinstated after two years with SuperRare explaining to him in an email that while his work wasn’t initially considered as art by the community, “so much has evolved” that their stance on his piece had changed – and to his advantage.

Eventually, the trashcan NFT became such a meme that it inspired thousands of copycat versions and massively bumped up interest in the original, with a collector eventually contacting Robness personally to find out more about his piece.

“It was one of three trashcans that were in SuperRare and I sold it to a collector,” the artist said. “He called me up because he wanted to know more about the story and we spoke for about 30 to 45 minutes about the whole hilarious story, and he was laughing most of the time.”

“So he wanted to collect it, and I gave him a price and that was that.”

Unsurprisingly, the price at which Robness sold the NFT for (US$250,000) has changed his life for the better – from sleeping in his car and doing odd jobs in 2014 to eventually making enough from his NFTs to keep him afloat comfortably.

This episode only highlights the reality of the NFT market, where many art pieces and collections have sold for hundreds of thousands (sometimes millions) of dollars despite having questionable artistic value.

But like how some fine art pieces (most of which are acquired tastes) can sell for stupid sums of money, many NFT collections have found willing buyers with deep pockets simply through the virtue of hype alone.

Most recently, a Singaporean influencer managed to rake in over US$5.8 million by simply selling images of herself on the OpenSea NFT market platform, while an Indonesian man managed a similar type of success (although slightly less lucrative) by putting up a collection of his selfies taken over a few years for sale as NFTs.

From personal images to abstract art, it really doesn’t appear as if the demand and supply (and by association, price action) of NFTs will find any logical footing anytime soon, no matter what your views on the technology may be.