Non-fungible tokens (NFTs) have continued to gain prominence since the launch of CryptoPunks in 2017. NFTs have contributed to the proliferation of blockchain technology. It has also brought about the need for marketplaces where NFTs can be sold. Although these marketplaces vary from one another, their sole function is to provide a commonplace for decentralized and trustless trading.
An NFT marketplace is a platform that allows users to buy and sell unique digital assets. They include universal non-fungible websites, niche marketplaces, and collectibles. Notable examples of NFT marketplaces are Solanart, OpenSea, SuperRare, Rarible, NBA Top Shot Marketplace, Axie Infinity, etc. They facilitate the minting, sale, and secondary trading of NFTs.
1. Personality NFTs
Things that can be turned into NFTs are limitless. Items like real estate, collectibles, art, antiques, event tickets, etc can be tokenized. The latest trend in NFT marketplaces involves individuals freely creating tokens around their interests and passions. They can also trade the NFTs of other people on secondary markets. People are beginning to create their NFT persona to represent themselves anonymously in the metaverse.
2. Web 3.0, Metaverses, and DAOs
Web 3.0 is being discussed with NFT marketplaces as it includes tokenized economics and decentralization. It would involve NFTs, decentralized autonomous organizations (DAOs), cryptocurrencies, and metaverses. It would allow people to control their content, including asset ownership, asset monetization, and rewards allocation.
Metaverse represents a 3D interconnected digital world that connects people using the blockchain, cryptocurrencies, and NFTs. Metaverses will help increase the adoption of NFTs and, consequently, NFT marketplaces. Metaverses will help change the real estate market as NFTs can be used as digital deeds for allocating plots of land.
With the growth of NFT marketplaces, DAOs will start springing up. A DAO is a decentralized autonomous organization that operates as a single entity. It will facilitate investment in blue-chip NFTs and access to exclusive artworks. It will also direct attention to NFTs.
3. NFTs and other Currencies
NFT marketplaces have aided the combination of NFTs with fungible cryptocurrencies, increasing access to digital assets. These marketplaces would serve as a meeting point for owners of in-game NFTs and players. Additionally, digital assets are finding their way into off-chain trading platforms like Amazon and eBay. eBay already supports buying digital assets.
4. Tokenization, Fundraising, and Loans
Among the main trends in the NFT space is game tokenization. This trend has made it possible for gamers to buy in-game assets, including game characters, virtual land, access to rare communities, and avatars. It is expected that projects with tokenized games will continue to increase as this would help promote their services, entice the audience, and enhance user relations.
Another trend is the use of NFTs to raise funds for charitable purposes. Notable examples include Beeple auctioning off a piece of the famous OceanFront collection and donating the proceeds to the Open Earth in Foundation and Ellen Degeneres raising over $33,000 from NFT auctions and giving the proceeds to the World Central Kitchen.
Also, NFT loans are currently emerging 1. These loans allow investors to use their NFTs and NFT collections for collateral in getting loans. Arcade is a DeFi project that supports using NFTs as collateral.
5. Profile Pictures
The recent trend in the NFT space is the use of NFT avatars as profile pictures on social media, and Twitter, for example. These avatars are unique digital assets with random attributes. Beyond social media, these avatars represent the next phase of the internet user interface.
6. Government Regulation
The buzz around NFTs has brought it under the radar of government regulations due to beliefs that they can be used to launder money and back terrorist operations. While there are no outright regulations yet, it is a trend to watch out for.
7. More Blockchains
The creation of NFTs started with introducing ERC-721 and ERC-1155 standards on the Ethereum blockchain. While it introduced a new era, it required high expenses, which was a barrier for some investors. However, these fees led to using other blockchains like Solana, Polygon, Avalanche, etc., to mint NFTs. These chains are already gaining traction, processing hundreds of millions of dollars in NFT volume.
8. VC Money and NFTs
Also, venture capitalist is making their way into the NFT space with the hope of making profits. There has been a significant rise in the number of VC investments and the cash amounts spent in the NFT space. Velvet Sea Adventures and 01 Advisors invested $100 million in the NFT platform Pixel Vault, Inc.
9. Crypto Exchange and NFTs
The increase in demand for NFTs has led exchange platforms to launch an NFT marketplace. Since NFTs are purchased using cryptocurrencies, collectors and flippers can perform the trade directly from the exchange platform. Binance, FTX, and Coinbase are some platforms that have launched their NFT exchanges.
10. NFTs and the Creative Space
The creative space is embracing the possibilities associated with NFTs. Consequently, NFT markets are being designed to aid the trading of intellectual property (IP). NFTs can serve as an avenue for crowdfunding, merchandising, and monetizing the creative space. The partnership between Gucci and Superplastic has led to the launch of the SuperGucci NFT. Similarly, a California-based platform (RMDS) is bridging the gap between investors with scientists and linking science and technology IP with associated personnel using NFTs. They are being used to raise funds for and release TV shows, comics, and film projects, including Men of the House, Stoner Cats, and GenZeroes.
11. NFTs and Big Brands
Big brands around the world are also jumping on the NFT bandwagon, each creating initiatives to entice their followers. These brands include Taco Bell, McDonald’s, Louis Vuitton, Nike, Pringles®, and Gucci. They use it to raise funds for charity, create new revenue streams, enhance social media engagement, and improve brand loyalty.
The adoption of NFTs will keep growing with new brands, and content creators will join the trend to promote their products and services. Similarly, marketplaces will support both artists and investors. While some of these trends will affect the NFT space positively, regulations may be of negative impact. Regardless, the space will keep growing, and adoption will continue increasing.
