• An almost infinite number of NFT projects on the market
• Crypto crash causes NFTs to lose enormous value
• Not the works of art themselves, but the application is in the foreground
With the rising prices for cryptocurrencies, the NFT market also experienced hype, so individual NFT sales with exorbitant prices drew attention to themselves. The blockchain’s native cryptocurrency, Ethereum, surged to the $4,000 level in 2021. However, since the third quarter of 2021, the trading volume has fallen by 88 percent, as shown by the data from the Web3 developer backend Alchemy, and the Ethereum price is currently only around $ 1,580 (as of January 27th, 2023) and thus significantly deeper. However, recent data also shows that smart contracts on the Ethereum blockchain have seen a significant resurgence since the end of Q1 2022.
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According to statistics from “MarketsandMarkets”, the NFT market proved to be more resilient in the bear market in 2022 than many critics thought: Because the industry came to a volume of around 3 billion US dollars despite massive price drops last year. A growth rate of 35 percent predicts the NFT market to be worth US$13.6 billion by 2027.
Further development of NFT projects 2023: most important trends and topics
For further development on the NFT market, the topics that separate the digital from the traditional are of particular interest art market distinguish: applications that go beyond simply collecting the works of art.
Alex Taub, co-founder of Truth Labs, the Web3 collective behind the well-known NFT collection Goblintown, told CoinDesk that 2023 will thrive on projects that manage to strengthen the sense of community by focusing on more authentic storytelling Stories concentrated and shaped in smaller collections. According to the creators, Goblintown artworks are “ugly but well done” and that’s exactly why it aroused collectors’ interest: “You can do everything right if you have great, compelling characters and a story,” says Alex Taub.
Another promising approach for NFTs is to provide them with a use case that goes beyond the actual collection of the artwork. For example, by linking ownership to certain property rights (including real estate) or access to exclusive experiences such as concerts or club memberships. nftnow CEO Matt Medved explains the approach behind utility-based projects to CoinDesk as follows: New innovative use cases of various types that address the wishes of different communities will be further developed in 2023. “You will innovate at the forefront of what the [Blockchain-]technology can really offer,” says Medved.
A successful concept in 2022 that could also set a precedent in 2023 is the Moonbirds collection by the NFT collective PROOF. Purchasing an NFT comes with private club membership, as well as additional benefits unlocked as the NFT is held for longer. The pixelated owls grossed approximately $200 million in primary and secondary sales following the launch of the Moonbirds collection. PROOF co-founder and CPO Justin Mezzell uses the term “nesting” to refer to owners holding NFTs for the long term. The aim of the project is to build a social platform and, in addition to discussion forums, also integrate users into the conversation, Justin Mezzell told CoinDesk.
Not just an investment: Web3 strategies will determine development in 2023
With the falling crypto prices, the prices for NFT collections have also gone down after the big hype. NFTs have not proven themselves as a pure investment. The resale opportunities and return hopes of many investors were disappointed in 2022. “NFTs serve more as a means to an end and less as an end in itself as an object of speculation,” BTC ECHO summarizes the meaning and benefits of NFTs in an article. In 2023, too, the further development of the technological dynamics of NFTs will be the focus. After the big hype and a self-reflective phase in the further development of Web3, according to CoinDesk 2023 further innovative and interactive application possibilities will move to the fore of the development of the manufacturers.
The first highlight of 2023 in the field of digital art is already on February 24th and 25th with the “NFT Paris”, which will take place this year in the special ambience of the Grand Palais Éphémère and should attract 15,000 visitors. The prominent speakers from the ranks of well-known global companies such as Volkswagen, Salesforce, LVMH, Shopify and L’Oréal and NFT industry leaders such as Yuga Labs, Ledger, The Sandbox or Arianee will address the common path to the Web3.
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