Is the NFT Space a Bubble? Will people continue spending $100k+ On a Digital Land or Card?
Posted On June 22, 2020
Is the NFT space a Bubble? Will we continue to see $100k spent on Digital Lands, Cards, Art, etc?
I was asked this in an interview which motivated me to explore the topic deeper.
Some NFT projects have been consistently seeing huge $ sales for their NFT’s. Decentraland has seen consistent $40-$60k Land Sales, even some $200k Sales at some point.
Axie’s have seen their Mystic Axie’s increase to 100+ ETH in some cases.
Cryptovoxels has seen 150+ ETH Land sales.
Is it a bubble?
The above handful of projects have been running 2-3 years strong and consistently building. Their products are out for the public to see so investors who pay big amount know what they’re investing in. Unlike a presale where we usually see this sort of hype. Less speculation, more based on what they plan on doing with these assets.
But we DEFINITELY Will continue to see hype phases or mini ‘bubble’ where there is a sudden upwards force.
The question is, how does the dust settle after.
Decentraland saw a huge volume increase in September 2018 and this momentum brought a LOT of investors and creators to the platform, many went away over time, many stayed and have added to a strong foundation. You can see in terms of land sale price, this momentum has mostly continued till today.
Bubbles come like Bitcoin. We see a huge uptrend in a short amount of time. They do pop and when the dust settles, regardless of a fall in price drop, there is,
smoother onboarding mechanisms,
more social influencers,
Generally – a lot of progress
Also, it’s easier to spend 100ETH vs $23,000 USD. Even though it’s the same $ value.
Many ETH whales are playing with surplus money. They’ve made it via the ICO, or buying in early. Most are high risk investors anyway, (that’s how most got the eth in the first place), and spending is more ‘investing’ in their eyes.
But for a non crypto it’s ‘HOLY CRAP $23k?!’
Understandable but as long as there are crypto whales we will continue to see big sales.
As ETH or BTC or the Crypto market continues to grow, and more people become crypto rich, we will definitely see huge consistent sales. As we’ve continued to see in the last 2-3 years DESPITE a bear run.
You can see how small the NFT market is compared to all of crypto, Huge room to grow just amongst our crypto neighbours.
Yes, the dot is the NFT market.
So is this sort of sales/momentum sustainable? YES – As long as Crypto holds as a strong store of value and people continue to build in this space.
BUT watch out for the quick spikes in volume, you don’t want to be buying at the top!