NFTs and Digital Assets made a strong showing in 2021. We’ve seen the NFT social component connected with this movement in everything from digital artists to Metaverse to videogames. Here’s a look at the year 2021 in context.
The year 2021 started with a quarantine owing to the coronavirus, which had been dragging on since 2020 and left the global economy damaged, leading many to hunt for a method to remedy the lack of revenue, discovering in Non Fungible Tokens, a multi-million dollar alternative.
The history of NFTs on blockchains originated in 2012 when the Bitcoin community was beginning to diversify and “hued coins” arrived on the market; this was the first antecedent of the NFTs known today.
Then, in 2014, a platform called Counterparty was born and connected to the Bitcoin Network, but as a separate protocol. Thus, the initiative presented as a distributed peer-to-peer system that allowed the creation of new digital assets.
That’s how collectible card games and rare meme trades made their way into the Bitcoin Network.
Shortly after, by the end of 2016, collectible memes also appeared with the famous figure of the “Rare Pepe.”
The first successful initiatives with NFTs in the Ethereum Network came from the hand of “CryptoPunks,” a series of 10,000 collectible images created algorithmically, which, up to this moment, enjoy great popularity among NFT fans.
Then shortly after, came “Cryptokitties,” a game where you can breed, buy, and trade digital cats.
For those who still do not know what makes NFTs so unique, it is essential to point out that they represent a unique, unrepeatable, and limited asset. Another quality is that they can be collectible due to their scarcity and rarity.
That’s also functions as tokenized versions of other digital elements or real-world objects. For example, they can represent a physical work of art or a video game character.
Supported by these characteristics, and in a scenario that made the future look diffuse due to the coronavirus.
Many digital artists, entertainment companies, musicians, influencers, and even video game creators, saw in the NFTs the opportunity to generate new sources of income, becoming essential for the new digital economy.
Some statistical data left by NFTs in 2021…
This new way of making money had remarkable growth during 2021.
To comprehend the NFT phenomenon is vital to grasp the value of collectibles left in the world of cryptocurrencies in 2021.
In January 2021, the amount of US dollars spent on completed sales of NFTs was USD 66 million. Since then, the sales of NFTs have increased rapidly and reached their highest moment on November 15, surpassing USD 46 billion.
However, it dropped sharply to USD 10 billion after a few days. For December, a slight increase was recorded, reaching USD 14 billion.
The total number of NFT sales in 2021 is another metric. The year began with 1.3 million sales, which grew to 1.4 million by June. August saw a slight increase in NFTs sold to a little more than 9 million.
After August, sales fell somewhat but rebounded in the following months, with more than 15 million digital collectibles sold in December.
When it comes to the most popular NFT collections over the previous 30 days, the Axie Infinity collectibles are top the list, detailed later in this article, followed by The Sandbox game.
The market capitalization of Axie Infinity is USD 563 million, while that of the metaverse-based game is USD 210 million in the previous 30 days. Third place goes to RTFKT, a startup that uses NFT to build goods and virtual experiences through NFTs.
Its arrival in this position is due to Nike’s acquisition of the company on December 14.
Markets for NFT have also grown on par with the entire collectibles-related sector in 2021. In that sense, the award for the leading marketplace for 2021 goes to OpenSea, a kind of Free Market dedicated to digital art and other collectibles.
Since its debut four years ago, OpenSea has processed over USD 13 billion in transactions. Meanwhile, it had a USD 2.3 billion transaction volume in the previous 30 days, with over 400,000 users.
With USD 3 billion in trading volume, Axie Infinity’s NFT Marketplace is followed by CryptoPunks with USD 2.3 billion in trading volume.
Thus, it is clear that non-fungible tokens are a multibillion-dollar business with ever-expanding use cases, suggesting that they may continue to gain influence in 2022.
NFTs as an outlet for digital artists
Several digital artists took advantage of the rise of NFTs to market their artwork, make themselves known in the world and generate income.
Artists appeared with the rise of NFTs in 2021, generating a stir, primarily due to the sum obtained in selling their pieces.
One of the first to earn millions of dollars was Beeple. The artist’s work was auctioned last March and reached USD 70 million, as reported by Crypto DeFinance.
The sale was notable for including a conventional art auction house, Christie’s, in the United Kingdom. This organization’s accomplishments include awarding Leonardo Da Vinci’s Salvator Mundi for USD 450 million in 2017, translated into one of the most expensive works of art ever sold at an auction.
This firm also ultimately joined the realm of NFTs, and their project was so successful that they claimed sales of Non-Fungible Tokens totaling USD 150 million in 2021.
Another auction house that also fell for the charms of NFTs was the giant Sotheby’s, also from the United Kingdom.
They even started operations of their dedicated marketplace for rare digital collectibles. The platform is named “Sotheby’s Metaverse” based on the Ethereum network.
However, some artists have reported plagiarism of their digital artwork. One such case is that of Liam Sharp, who denounced on Twitter that he would have to close his art gallery on the DeviantArt platform because they have stolen his works to elaborate with them some NFTs.
“People keep stealing my art and making NFTs,” he said. He explained that this is something he has reported but has been ignored. For him, it’s sad and frustrating, he noted.
Because they may be reproduced with a simple snapshot and sold on platforms designed explicitly for non-fungible tokens, cases like Sharp’s call into question the stated validity promised by non-fungible tokens.
The introduction of NFTs into video games and the Metaverse idea
Similar to how non-fungible tokens exploded into the art scene in 2021, play-to-earn (P2E) games built on blockchains enable users to earn rewards in the form of cryptocurrency, and non-fungible tokens also caused a sensation.
One of the most popular games during 2021 has been Axie Infinity. This one is about collectible creatures that fight each other.
Each of these creatures is an NFT capable of reproducing new, valuable characters. Axie Infinity has expanded so rapidly that, according to Dapp Radar, it has moved over USD 3.8 billion since its start in 2018.
In 2022, revenue-generating video games are likely to continue rising. Numerous individuals have discovered a way to solve their economic problems by engaging in an activity that has no set schedule and can be accomplished anywhere with an internet connection.
Because of the growing popularity of peer-to-peer gaming, huge developers of conventional video games have been thrilled about this new method of conducting business.
In this regard, one of the most notable players in the French business is Ubisoft, which announced its debut into the realm of NFTs by incorporating them into one of its most popular games, Tom Clancy’s Ghost Recon Breakpoint.
Video Games NFTs are to be sold on third-party marketplaces outside of the Ubisoft network, which might inspire other game development businesses and expand the market for NFTs.
NFTs also opened the way to Metaverses, virtual worlds in cyberspace where individuals engage socially and economically via their symbols or avatars.
While Metaverses have existed for some time, Facebook CEO Mark Zuckerberg’s announcement of the company’s name change to Meta and his vow to construct a computer platform based on the Metaverse idea made it a prominent subject.
Decentraland is one such Metaverse concept that has been moving since 2017. In that reality, virtual assets have skyrocketed in value due to Zuckerberg’s revelation.
Indeed, in November of last year, a virtual land was sold for a record price of more than USD 2.5 million, enhancing the price of the MANA token, which is related to Decentraland.
The music and entertainment industry also entered the NFTs.
Music and film industries, for example, did not want to be left out of an NFT-driven market. Muse was one of the first rock bands to release a series of collectibles in 2020 to promote their current album.
The NFT can be an alternative in the future for those musicians or artists who do not have the support of major record labels and thus make their works known independently.
The film business has also made room for NFTs Warner Bros., for example, to offer a series of digital collectibles for the fourth episode of the film “The Matrix Resurrections,” which was released on December 22.
More than 300,000 individuals attempted to purchase some of them for USD 50, causing the site that sold them to collapse within the first few hours.
Regarding the NFTs, Keanu Reeves said that “they reproduce easily” and made a mocking comment about the NFTs because he considers that anyone can download them.
In other words, for Reeves, NFTs are not exactly unique, and there is no guarantee that there can’t be replicas of the images, so, in an interview with The Verge, he doesn’t quite understand the NFT concept.
Goals, Three-Point Line, and Home Run play in the NFTs.
Sports, which helped to commercialize followers’ enthusiasm, was another sector that played an essential part in the massification of NFTs in 2021.
Dapper Labs, developer of NBA Top Shot, a game based on the world’s most famous basketball league, was a pioneer in merging sports games with digitally limited merchandise.
According to Dapp Radar, it has a market volume of USD 750 million.
Soccer is another sport that has taken advantage of the chance to start NFT.
One of the industry leaders in the French startup business is Sorare, which developed a fantasy soccer game using non-fungible tokens and included national teams and soccer teams such as France and Germany on its platform.
Baseball is just another sport that has made non-fungible tokens accessible to its fans. In this regard, Major League Baseball (MLB) collaborated with Candy Digital, an Ethereum-based platform, to offer digital collections of iconic players such as Lou Gehrig.
Global brands took part in NFTs, some giving to charities.
Fast food and beverage firms have not spared the non-fungible token mania.
For example, Coca-Cola, Pepsi, and McDonald’s have established their own NFTs to deepen their consumer relationships.
Most of these launches were given out for free, except for the Coca-Cola collectibles auctioned off, but the proceeds went to the Special Olympics.
In the same direction of generating aid through NFTs, social organizations have also entered the world of digital collectibles.
One good example is a collection of 20 pieces produced by Peruvian artist Knot Paolo as part of the NGO Conservation International’s campaign to protect the Palo Alto Mayo Forest Sanctuary.
Two of the NFTs have been sold so far, and many others are still offered on the marketplace for OpenSea collectibles for 0.18 ETH.
For example, the United Nations Children’s Fund (UNICEF) stated two weeks ago that it intends to issue a collection of non-fungible tokens to commemorate the organization’s 75th birthday.
NFTs will collect revenue for a range of organizations that help improve more children’s lives across the world.
One such program is GIGA, a joint UNICEF and International Telecommunication Union program to connect every school on Earth to the Internet through cutting-edge technologies such as low-Earth-orbit satellites, machine learning, and distributed ledger technology, among other things.
Prospects for NFTs and Digital Assets in 2022.
The Block presented a document that discusses the possibilities for digital assets in 2022.
“Investor interest has turned to NFT projects that can potentially provide more utility in aspects such as advertising, content monetization, and gaming,” the document states.
As expected, the conventional Collins Dictionary selected “non-fungible token” as the Word Of The Year in 2021. The selection was made based on the term’s “enduring potential” as well as its “cultural importance.”
That shows that NFTs are poised to expand their associated use cases rather than being a passing craze, albeit they are now concentrated on the video gaming industry.