Is NFT a Hype That Has Already Burst, or Still Waiting for the Bubble to Burst?

No one can predict the future with certainty, but with the current level of spending and support, it seems unlikely that the speculative fervor around NFTs will simply fade away. Many significant corporations are transitioning their focus toward web3, indicating that the smart money believes in the long-term potential of NFTs.

The Myth of Endurance: A Failed Example

One of the earliest tweets ever has been sold for a record-breaking amount - $2.9 million last year. Then, just a year later, the owner tried to sell it for $48 million. The highest bid he received? A mere $280. A 99.99% drop is a clear sign that the bubble has already burst. The indication is that the market is not waiting to see the future standing on its laurels, but is moving swiftly towards its collapse.

The Future of NFTs and Blockchain Asset Trading

Despite the failures of certain high-profile NFTs, the underlying technology holds significant promise. NFTs are poised to revolutionize how we trade assets on the blockchain. With time, we will likely see a surge in NFT-related activities. To put this into perspective, the U.S. stock market is valued at $30 trillion, and the global stock market is valued at $90 trillion. These numbers are far above what we currently see in the blockchain space, in part because companies with substantial market capitalizations hesitate to move their assets due to liquidity issues. However, as NFTs present a solution to these problems, we might see the stock market moving onto the blockchain within days, not months or years.

The Profitability and Reliability of NFTs

At present, NFTs may be profitable and reliable because there are still enough people willing to invest and trust in this new form of asset. Just like in any other investment, it’s crucial to know when to hold and when to exit. NFTs can be viewed as a speculative asset, similar to investing in stocks or cryptocurrencies.

Cautionary Analogy with Confederate Currency

Just like how Confederate currency became worthless overnight after the Civil War, the same could happen with NFTs if there is a significant legal change or a social event that devalues them. It's crucial for investors to stay diversified and not rely solely on NFTs. Investments in solid commodities like real estate, established currencies, or gold can offer a more stable and secure return on investment.

If you can't beat them, join them! The current buzz around NFTs suggests a vibrant and evolving market. It’s up to individual investors to decide when to enter the space and how to navigate its complexities and potential.