If NFTs are dead, why are bored monkeys still making over $100,000?

Someone please tell the Bored Ape Yacht Club that NFTs are dead, because no one is listening.

Most of these best Bored Ape NFTs — digital art that people use to make art galleries or pin to the wall in a frame in their New York penthouse — still cost upwards of $120,000. For some reason, Bored Ape #6588 has a price tag of $1 million.

Despite the weakness in the digital asset market, the average price people paid for an NFT rose 2.5% to $371. Buyers are down 10.3%. Sellers looking to offload are down 16%. Overall sales are down about 10% to $10 million and change, according to the Non-Fungible Market Tracker.

People find it difficult to sell their expensive NFTs. The Malaysian businessman who bought an NFT of Jack Dorsey’s first tweet for $2.5million last year struggled to get offers of more than a few hundred dollars when he tried to resell it in April of this year. Maybe buyers have realized that JPEGs aren’t worth millions of dollars.

That doesn’t mean NFTs are dying, as many of them are needed for games or special club memberships, like the Bored Ape Yacht Club. For investors in NFT platforms or digital art itself, this means the speculative frenzy is over.

The NFT craze will no longer make teenage millionaires every day. With little hype, investors will have to focus on the actual applications of NFTs, if they can find them.

“The hype around JPG NFTs and their stories of overnight millionaires has helped familiarize people with the emerging Web3,” thinks Theresia Le Battistini, CEO and Founder of Fashion League, a game for budding fashionistas who are ready to give blockchains a shot. “Regardless of the market situation, NFTs are the most exciting improvement in blockchain technology. NFTs are more than just images,” she says, calling them “unique digital assets” that often have a “It could be for ticketing, shopping, or gaming apps…NFTs will be there and will be driving the mass market adoption of Web3, I think,” she says.

Oren Langberg CMO at MonkeyLeague, another blockchain game that uses in-game characters that you can buy and sell, says that once the dust settles on the NFT bubble, “we will see, and are already seeing, NFTs with a more real utility and these are the ones that will survive market volatility.

It’s time for a commercial break. What is an NFT anyway?

Forbes AdvisorWhat is an NFT? Non-Fungible Tokens Explained

NFT stands for non-fungible token. It is usually built using the same type of programming as cryptocurrency. An NFT is a digital asset that’s supposed to (though I’m not convinced there’s a real Bored Monkey Yacht Club painting somewhere in a warehouse; or a new blockchain game character outfit sitting in the closet of a developer) represents real-world objects. These items are almost always art, but can be music, videos, and items for use in games – things like magic swords or other items that these digital characters can use in this online world. (mainly gamers).

They are bought and sold online, often with cryptocurrency, and they are usually encoded with the same underlying software as many cryptos. NFTs are also meant to be one of a kind and have unique identification codes.

The NFT boom started in 2021. It turned hundreds of artists and influencers into millionaires overnight. As the hype continued, with Tom Brady and Cristiano Ronaldo entering the picture, famous people started using NFTs as a fan engagement tool. Ronaldo sold one last year for $290,000. Binance, a crypto exchange, signed him up to join the NFT grain mill in June.

Global NFT sales in July 2022 were $647 million with 532,378 unique buyers and 5.6 million transactions. In January 2022, global NFT sales were approximately $4.78 billion with 1.07 million unique buyers and corresponded to 9.36 million transactions, led by Loot, Bored Ape and Crypto Punks – the Canadian makers of these pixelated portraits that look like something out of the Atari 2600.

Last year, someone spent almost $17 million at a Christies auction for a set of NFT Crypto Punk. The buyer walked out without having to wear a picture frame.

NFT Darwinism: Only the Fittest Survive

NFTs are a weird security for sure. Outside of buying digital furniture in a digital world, why would anyone want a collection of Crypto Punks that exists in the cloud, and not a 5×5 painting of them on canvas that only you own?

Last year, R&B singer Trey Songz sold an “NFT album”, allowing fans to buy directly from him rather than the label. Why Songz needed an NFT for this is beyond my intellect, but I would like as a cryptocurrency investor to understand the difference between Songs making an NFT album and him making a website and selling his music directly to the consumer in this way rather than via a label disc or iTunes?

Gaming seems like the perfect use case for NFTs, and everyone knows that the video game market, whether it’s PlayStation or a blockchain game played by a niche audience, is a growing market. However, this is geared more towards Web3 blockchain gamers and not traditional games.

For example, at the end of last year, Electronic Arts
EA
CEO Andrew Wilson has called NFTs an important part of “the future of our industry”. But on an investor call this winter, icon Madden and video game publisher FIFA told investors that NFTs were “not something we dabble in.” He compared them to past modes of venture capital for gamers, such as 3D, augmented reality
AR
and now VR games.

“With every new innovation, many new startups appear and a frenzy begins, while in bear markets the real builders put their heads down and keep building,” says Hosam Mazawi, co-founder of Snook, a game to win Gamefi . . “There are many uncharted territories in NFTs and their use cases. We have introduced the first business-related staking that allows brands or any group of interested gamers to host their own brand environment within our platform,” he says.

“The gaming industry was the first to see the potential of NFTs,” says Val Maincard, CEO and Founder of Maincard.io, a fantasy sports management platform that offers NFT cards for guessing match results. in major sporting matches around the world. “Using NFTs as in-game currency gives it the most important quality – which is liquidity. It’s the most valuable feature of a long-term product. Do people want it or not?

Some real estate companies have also tried to create digital worlds where you would buy NFTs – which could be like the penthouse suite, a cool living room set – and maybe you could have virtual meetings there. It looks like an imaginary market, with the usual potential for massive price increases. If investors surprise the bulls at the right time, they will be ahead of the line, safe from harm. Catch that delay, and you might be dealing with those pointy horns of rampaging bulls.

MORE FORBESCouncil Post: A guide to using NFTs in real estate

“The big mistake people make is to equate cartoon animal images with the underlying promise of the technology that makes NFTs possible,” House of Kibaa Chief Commercial Officer Neil Stevenson-Moore told Reuters. Vancouver. House of Kibaa is the lead brand of Canadian digital agency Looking Glass Labs, and is a web3 design studio for the NFT and metaverse industries. “At its heart, all an NFT does is prove ownership of something digital. And in a world where literally everyone is addicted to a digital device in their pocket, it’s foolish to think that this technology is not going to be transformational,” he says. “At House of Kibaa, we’re glad the first wave of madness has passed. That way, the real innovators will start to emerge.”

Investors who chased NFT games this year lost almost everything. Enjin Coin
ENJ
and Axie Infinity
AXS2
are down more than 80% since the start of the year.

The cryptocurrency market loves upheaval. Remember, they all loved the death of the Initial Coin Offering because it was going to usher in some serious projects rather than coins and scams. The death of the ICO eventually pushed Bitcoin close to $60,000. Will the bloodbath in NFTs ultimately lead to meaningful gains for the best in the business? For sure, he will. Which one it is, however, is anyone’s guess.

Twitter
TWTR
, Reddit, and Instagram announced plans to support NFTs for creators. Renowned venture capitalist Gary Vaynerchuk launched an NFT collection called VEEFRIENDS to provide exclusive access to his annual conference.

“The realization only means that the future looks extremely bright and hopeful for NFTs,” thinks Ramkumar Subramaniam, co-founder and CEO of Jump.trade, an NFT marketplace in India. “It will create a new community of collectors who are motivated rather than those driven by short-term profit.”

* The author of this article owns enjin coin and bitcoin.

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