Non-fungible tokens (NFTs) have come a long way since the debut of Crypto Kitties back in November 2017. Last year, this particular crypto ecosystem hit $25 billion in total sales as digital collectibles became more popular. It is also noteworthy that ‘NFT’ ranked among the most commonly searched words on Google and other search engines.
So, what is the history and where is this market heading? While NFTs have been around for over three years, 2021 marked a significant breakthrough. One of the highlights was the sale of Beeple’s ‘Everydays: The First 5,000 Days’ digital collection which sold for $69 million at a Christie’s auction.
Following this record sale, more NFT collections began to debut in the market. Most notably, the Bored Ape Yacht Club (BAYC) NFTs designed by Yuga Labs; the current floor price of one BAYC is 110 ETH ($357,000 as per the prevailing market prices). Another prominent collection is Crypto Punks, which was created by Larva Labs.
Well, the NFT market has since grown past the ‘JPEG’ era to integrate more fundamental innovations. The next section of this article will highlight some niches where NFT projects are making a difference.
1. Protection of Digital Assets
The digital asset market has ballooned into a $2.1 trillion ecosystem as of writing. Unlike in the early days where retail investors dominated the market, institutions have also been acquiring exposure to assets such as Bitcoin and Ethereum in recent years. That said, this market has a major downside when it comes to security; in some cases, DeFi protocols have lost hundreds of millions worth of investors’ money.
Thanks to NFTs projects such as Serenity Shield, crypto users can now secure their funds and pass them on to the next generations. This Solana based NFT project features a Decentralized Identity (DID) solution that leverages NFT keys and smart contract vaults to introduce a StrongBox function. This Serenity Shield ‘account’ enables users to protect their digital assets from malicious players.
How does it technically work? Serenity Shield’s DApp partitions a client’s metadata into three unique NFTs. One of these NFTs is held by the account, the second one by the recipient (heir or an alternative recovery account) while the third NFT is stored by Serenity Shield. Most importantly, a minimum of 2 of the 3 NFTs is required in the event one (a recipient) wants to decrypt the private information associated with their inherited digital assets.
2. Gaming Ecosystems
The gaming sector is probably the most NFT-compatible niche to date; according to market stats, NFT games are becoming more mainstream with some players making a living from this ecosystem. At the core, NFT games have introduced a play-to-earn (p2e) model where gamers can earn a passive income as they engage in various challenges or endeavors. An approach that has attracted significant participation in the upcoming NFT games.
For instance, the MOBLAND mafia metaverse game allows people to become part of a ‘crime’ syndicate like it happens in the real-world. Gamers and fans who adore such a lifestyle can now virtually join MOBLAND as ‘made men’ and create or join an existing syndicate. This game is governed through a Mafia-as-a-DAO structure, allowing the community members to vote on platform developments and other important issues.
Given its value proposition as a play-and-earn and free metaverse game, MOBLAND’s Initial Game Offering (IGO) raised over $3.5 million within half an hour. They also recently partnered with Bybit crypto exchange which is now building a virtual headquarters inside MOBLAND. Though still in its early stages, the MOBLAND launchpool attracted over 30,000 participants to hit a TVL of $100 million on the first day.
3. Market Analytics
With the NFT market becoming a major segment of the digital asset economy, analytics platforms have also emerged. One such ecosystem is BitsCrunch, a leading analytics site designed to enable users to navigate the NFT market. This project recently completed a $3.6 million funding round led by Animoca brands and other heavyweight crypto investors, including Crypto.com Capital and Coinbase Ventures.
So, what is the value proposition of BitsCrunch? Simply put, this NFT analytics platform features four functionalities that address the various challenges in the digital collectible market. The first product is Scour (provides services around wash trade detection and prevention); Crunch DaVinci (detecting NFT forgeries through AI); Liquify (estimation of the fair price of a particular NFT); and finally Unleash NFTs (real-time tracking and analytics).
NFT stakeholders can leverage BitsCrunch tools to inform decision making and protect their assets from hackers. As the NFT market grows bigger, it will also be much easier to operate on a one-stop shop such as BitsCrunch for market analysis.
Conclusion
The NFT market still has a lot of potential to revolutionize how we live. Besides the highlighted sectors, other industries such as entertainment are gradually integrating NFT innovations. Prominent celebrities are now buying land on the metaverse, with some going to the extent of hosting virtual concerts. Looking at these developments, one can predict that NFTs will be a significant part of tomorrow’s internet (Web 3.0).
