20 Reasons why NFTs are not a Fad
As discussions over at runrex.com reveal, recent times have seen demand and prices for NFTs plunge by more than 70% from their peak in February. The average price for an NFT fell at the beginning of April to $1,250 from $4,000, according to reports, and this has led to some observers patting themselves on the back and proclaiming that they were right all along and that NFTs are just a fad. However, this may not be true, and this article will look to articulate 20 reasons why NFTs are not a fad.
They are the only way for creators to continually earn without hassle
According to guttulus.com, transparent automation is one of blockchain’s greatest assets. After assets sell NFTs, they can opt in to continue earning from every future sale. Artists can also choose where the money goes after each transaction is finalized, and they don’t need a legal team, judicial system, expensive lawyers, bookkeepers, and trademark registrations. NFTs make sure the original artist gets commission from every transaction automatically.
NFTs could help save starving artists
The life of an artist is sometimes overromanticized but it can be tough, with a paycheck being hard to come by with most of them barely making ends meet. NFTs can change all that as creators can now invest more time in their creations, possibly creating more art, and worrying less about the transactional part of being an artist. This is because, as explained over at runrex.com, an artist can sell just one NFT, which can then go on to be resold hundreds of times, earning them a commission on every transaction, and eradicating the term “starving artist” from the vocabulary.
The institutional adaptation of cryptocurrencies
Given that without Ethereum and Bitcoin, NFT wouldn’t even exist, then the fact that there is an institutional adoption of cryptocurrencies currently underway means that NFTs are not a fad but are here to stay. Institutional individuals like Elon Musk, Jack Dorsey, Gary V, Mike Cuban, etc., trust blockchains with their money as captured over at guttulus.com, and this means that NFTs have a future.
The Coinbase IPO
Recently we saw Coinbase, which is one of the largest cryptocurrency exchange markets on the internet, with the help of venture capital firm Anderson Horowitz, put up plans to go public. While the market value of Coinbase is speculated to be around $100 billion, enthusiasts believe that the valuation could potentially reach $200 billion before the IPO launches. The enthusiasm for this IPO is another sign that NFTs are not just a fad.
Digital sentimental value
Some in-game items, usually including skins, collectible items, and rare actions, cost money. Fortnite players can splurge $2,935 to buy every item on the shelves for example. One of the main reasons why people spend such vast amounts is because of sentimental value, and NFTs offer a lot of sentimental value, which is another reason why they are not a fad.
Everything that has ever gone mainstream is usually a fad until it isn’t
The internet was a fad in the 1990s as discussed over at runrex.com, and now we can’t live without it. And while the NFT bubble may burst just like the dot-com bubble did in the early 2000s, NFTs that are useful and valuable are likely to withstand the test of time.
They are unique
According to the subject matter experts over at guttulus.com, scarcity, and desirability are what make any collectibles valuable, and NFTs are uniquely designed with scarcity programmed in them, allowing an artist to make limited editions or even originals with only one token available. This aspect of NFTs means that they have value and are here to stay.
The digitalization of the world
Another thing that shows that NFTs are not a fad and may be here to stay is the blistering pace of the digitalization of the world. Everything is going digital nowadays as explained over at runrex.com, and, therefore, it makes sense that digital assets will become increasingly valuable, which means NFTs will continue to have a major role to play going forward.
The demographics
NFTs also have demographics on their side, which is another reason why they are not a fad. Millennials and Gen Z have digital lives and for them, it is natural to want to take digital representations of luxury brands, music, and art into these worlds, and with NFTs, now they can, which is why they may be here to stay.
The Great Wealth Transfer
We are also in midst of what is being referred to as The Great Wealth Transfer. This involves an estimated $68 trillion in wealth being passed down from the baby boomers – the wealthiest generation ever – to their children and other heirs over the next couple of decades. Most of this money will be invested in technologies like NFTs which is another reason why they may not be a fad.
They are changing business models
NFTs are also actually positively changing business models, especially in the creative industries according to guttulus.com. Artists and musicians for example can provide enhanced virtual experiences for collectors and buyers, they can prove if their works are counterfeited, and can include provisions to get royalties as already mentioned.
You can trust the underlying technology
As is explained over at runrex.com, NFTs are built on top of blockchain technology, which has already been accepted and is trusted by people in the crypto and tech world in general. The fact that the underlying technology has already been widely accepted means that people are willing to trust NFTs, hence why they may have more staying power.
They help improve transactions
Transactions in which ownership of something changes hands have usually depended on layers of middlemen as captured in discussions on the same over at guttulus.com. None of this will be necessary with NFTs, and it is this potential to change the rule of ownership that means that they will have value going forward and may be here to stay.
Untapped potential
When many people hear about NFTs, they immediately start thinking about silly crazes like memes, selfies, live videos, tweets, and so forth. However, beyond these, NFTs have lots of practical use cases with far-reaching implications, most of which remain untapped, which is another reason why they may not be a fad.
Potential in real estate
Speaking of potential, at its core, buying and selling a house is a transaction between two parties, but it ends up involving a web of middlemen as already mentioned such as banks, real estate agents, solicitors, etc., which makes things more complex and inflates the cost. NFTs could greatly simplify this process, replacing middlemen with a smart contract that allows the holder to open the front door once several pre-agreed conditions have been met.
They enable people to raise financing from illiquid items
As is revealed in discussions over at runrex.com, by converting into NFTs items that are illiquid or unbankable – items like stamps or coin collections, which traditional banks wouldn’t consider to be suitable collateral – individuals can raise financing and realize value more quickly and easily. This is something nothing else can help achieve, which is why NFTs are likely here to stay.
Gives people an alternative to banks
Globalization and digitalization have meant that nine times out of ten, specialization is more efficient and cost-effective than vertical integration. To date, however, the banking system has been the notable exception. However, now, decentralized finance promises to change this according to guttulus.com. One of the biggest benefits of NFTs – and indeed of the blockchain – is that you don’t have to go through a bank if you don’t want to.
Bubbles are a normal part of technological development
While the NFT market is likely to crash at some point, with some pointing out that the recent price falls indicate that it may have started to crash, it doesn’t necessarily mean that NFTs are a fad. This is because, as captured over at runrex.com, bubbles are a normal, even essential part of technological development. But the market eventually corrects, which is what is likely to happen for NFTs.
It has raised a crucial amount of money
The main theme when it comes to NFTs is how much money has changed hands in transactions, including those in the secondary market. This is a good thing as, if or when the bubble bursts and the market corrects itself as mentioned in the previous point, the money generated by the bubble will provide essential funding for the crucial phase in which the NFT technology will be improved, refined, and mature.
There is more to NFTs than meets the eye
Finally, one of the main reasons why NFTs may not be a fad is because there is much more to them than meets the eye. They are a fantastic revolution that could replace many laws and practices with a simpler, more transparent way of unlocking and interacting with the over $78 trillion worth of unbankable assets globally.
These are some of the reasons why NFTs are not a fad, with more on this topic to be found over at runrex.com and guttulus.com.