NFT: Bubble or Future?
Are NFTs just a fleeting bubble or a future opportunity in the digital age? Today, I’d like to share my views with you.
NFTs, or Non-Fungible Tokens, are essentially a way to certify digital assets based on blockchain technology. They provide a unique “digital identity” to digital works, addressing the long-standing issues of copyright and ownership in the digital realm. Each NFT carries specific digital content and information, whether it’s an artwork, music, video, or in-game items, all of which can be uniquely identified and traced for ownership through NFTs. This provides creators and investors with a new mode of value transmission and trading.
⭐️ NFTs offer creators a completely new mechanism for copyright protection and revenue distribution, helping to resolve issues of infringement and profit-sharing in the traditional content industry.
⭐️ NFTs can be used to build decentralized identity systems, helping users securely manage personal data and digital identities across different platforms and applications. Users can prove their identity, educational qualifications, professional credentials, etc., through NFTs without needing to repeatedly submit various proof materials, enhancing the efficiency and security of identity verification.
⭐️ NFTs can serve as virtual assets on social platforms, enhancing users’ sense of participation and belonging, and promoting community formation and development.
From the above, it is clear that NFTs do have practical application scenarios, but it is also undeniable that a bubble has formed during the development of the NFT market.
In 2021, the NFT market experienced explosive growth, with artist Beeple's work “Everydays: The First 5000 Days” selling for $69.3 million at Christie’s auction house, marking a milestone event in NFT history.
After that, a large amount of capital and speculators poured in, with many projects lacking real value support, relying solely on hype and concepts to attract investors, leading to a significant market bubble. Entering 2022, with the overall downturn in the cryptocurrency market, tightening regulatory policies, and a decline in user interest, the heat of the NFT market began to cool down, trading volumes drastically shrank, and many once-thriving NFT platforms gradually declined.
The essence of this chaos can be attributed to the lagging regulations and laws following the emergence of new phenomena.