NFT trading volume in the quarter from August-October 2021 saw an increase of 38,000% in comparison to the previous year, bringing it north of $10 billion according to DappRadar. This shows the staggering rate at which the NFT market is growing despite its infancy. With such dramatic growth in mind, what does the future of NFTs hold?
2021 was the year of the brands finding their feet in the NFT space, and the level of growth means it’s inevitable that more will follow suit, particularly as we expand more into the metaverse. As part of this, we’re going to see a greater crossover between physical and virtual offerings from businesses.
Some of the most recognisable names in fashion have already been making moves in this respect. Nike have acquired RTFKT studios with a view to minting NFTs in the form of digital trainers, which would allow further customisation of avatars we’re already seeing in the metaverse.
NFTs have also been touted as a way of shaking up the music streaming model that is dominant today, by reintroducing the collectible element we used to see with CDs and records while financially rewarding artists more proportionately. The secure and efficient nature of the blockchain also means that some see NFTs as the future of transferring property ownership.
It’s still very early in the era of NFTs and with the levels of growth investment we’re seeing in this sector right now, the world, both real and virtual, is very much their oyster.
The Future of NFTs and Digital Worlds
Last year’s momentous announcement about Facebook‘s expansion into the metaverse under its new guise of Meta has sparked a renewed wave of interest in NFTs. NFTs are already seen as the bridge to the metaverse by way of facilitating identity, community and social experiences in these digital worlds.
Decentraland is a digital world that aims to incentivise a global network of users to operate it. Users can buy and sell digital real estate, with ownership represented in NFTs leveraged in the Ethereum blockchain. Over time the platform has evolved to facilitate interactive apps, in-world payments using its native MANA tokens, and peer-to-peer communication between users.
Another digital world, Sandbox, works in a very similar way in terms of buying and selling ‘land’ in virtual reality but it works in a gaming format. Again built on the Ethereum blockchain, users transact with SAND tokens to build and design their on avatars to access a variety of environments, games and hubs in this metaverse. Digital goods are created which can then be monetised through NFTs and sold for SAND tokens, which users can also earn through playing games and buying on crypto exchanges.