- Cryptocurrency investors flocked to Art Basel in Miami Beach, Florida this week, and nearly 200 other blockchain events in the city.
- Many acknowledged a volatile momentum behind NFTs as they pull in an estimated $2 billion per month. But investors are still optimistic on the underlying technology.
- “Most people assume that some version of the bubble is happening. But most of us who have been in space assume whether it goes up or down, it’s a new thing that’s here in some version of itself. Have to stay,” says Mike Shinoda.
Miami Beach, Fla. – Even if there is a flash in the NFT pan, cryptocurrency investors are betting that the underlying blockchain technology is here to stay.
Crypto enthusiasts and venture capitalists flocked to Miami Beach, Florida this week during one of the world’s premier arts events. For the first time ever, several NFT exhibits were on display at Art Basel Miami. But the city also hosted 200 other events, where the focus was more on the technology behind these digital collectibles.
Musicians, artists and celebrities are battling to launch NFTs, or non-fungible tokens, which are unique digital assets whose ownership rights are verified and stored on the blockchain. It’s a way of taking ownership of content that has historically been easy to replicate online.
According to recent estimates from JPMorgan, the new asset class is growing from $400 million in January to nearly $2 billion a month. DappRadar analysis shows NFT volume skyrocketing 38,000% year-on-year $10.7 billion in the third quarter.
“There’s definitely a lot of hype,” said Mike Shinoda, musician and co-founder of the band Linkin Park, which launched a new NXT mixtape this week. “Most people assume that some version of the bubble is happening. But most of us who are in space think it goes up or down, it’s a new thing that’s here to stay in some version of its own. “
Tristan Yewers, head of strategy at Miami-based FTX US, said the hype benefits all corners of the crypto industry, even if the parts are priced higher. According to Yavar, digital art can be a less intimidating way to introduce people to blockchain technology.
“We all have some basic understanding of the art. Not all of us have a basic understanding of cryptocurrencies and blockchain – this is the next step towards mass adoption,” Yevar told Businesshala. “NFT is the first time many people have made connections with cryptocurrency and blockchain.”
Blockchain technology used to be synonymous with bitcoin. But over the years, many other blockchains have emerged that now support things like finance applications and video games.
Also known as distributed ledgers, the main attraction for building on blockchains is that they are “decentralised”. There is no central authority controlling these networks and there is no single point of failure. Advocates say it is more transparent. Some tech investors see this as the next wave of the Internet, calling it “Web 3.0”.
Adam Judd, head of crypto at Liontree, said that some typical NFT projects feel “somewhat bubbly.” But he still sees category growth and new use cases around recognition, community promotion, start-up funding, entertainment and fashion. He pointed to the Board Ape Yacht Club’s cultural events, and Beeple’s record $69 million NFT sales driving “extreme interest” in Web 3.0.
“One of the biggest opportunities right now is the user-friendly interface and experience for the everyday person that makes NFTs accessible, valuable and affordable,” Judd said. “Once the everyday person feels as comfortable buying an NFT as they are buying a coffee, the rest of Web3 will benefit.”
Not Boring Capital founder Packy McCormick was also in Miami this week and said the NFT program was a major catalyst for bringing like-minded people into the same room. But the conversation was moving towards decentralized autonomous organizations, or DAOs, a new type of governance system, and other new use cases for blockchain.
“Once people get into NFTs, they want to learn about everything that is going on in blockchain – it’s impossible not to go down the rabbit hole,” McCormick said. “Too many people to speculate are going to come. But important projects will have power and over time, quality will win out.”
WATCH: Art Basel 2021 Begins as NFTs, Crypto Enthusiasts Descend in Miami