The already booming NFT (non-fungible token) market will experience a massive increase in volume over the next 12 months as more major investors begin to pile in, predicts the CEO of one of the world’s largest independent financial advisory, asset management and fintech organisations.
The bullish prediction from Nigel Green, chief executive and founder of deVere Group, follows the announcement by Visa that it bought a “CryptoPunk,” one of the thousands of NFT-based digital avatars, for nearly $150,000 in ethereum; and as Marvel Entertainment begins unveiling its first official NFTs in the form of Spider-Man ‘digital statues.’
An NFT is a unique digital asset designed to represent ownership of a virtual item, such as artwork, music, a video clip, or tokenised tweet, amongst other representations.
Mr Green says: “The market for NFTs hit new highs in the second quarter, with $2.5 billion in sales so far this year. This is almost 20-times more than the $13.7 million in the first half of 2020.
“With soaring interest from major investors like payments giant Visa, who understand and value that the future of almost everything is geared towards digital, demand is set to explode.
“As the big hitters pile in, their capital, expertise and reputational pulling power will attract a growing number of other investors – both retail and institutions looking to get into the market.
“Demand will also be fuelled by a growing number of NFT marketplaces where you can make purchases, as well as there being more and more artists, musicians, sports, fashion, entertainment, gaming and retail brands producing digital assets to engage with consumers, clients and fans.”
He continues: “This is a market which is just getting started. There’s been a surge of interest this year but I believe 2022 will be the breakout for NFTs.
“We expect there to be a massive increase in volume in the market over the next 12 months.”
NFTs may be something of a novelty currently, but it “makes sense,” says the deVere CEO, that with the accelerating pace of the digitalisation of our world, digital assets will become increasingly valuable.
“Demographics are on the side of NFTs too. Millennials, and Gen Z especially, have digital lives and it’s natural to want to take digital representations of luxury brands, sport, music and art into these worlds – and now they can.”
Plus, Millennials are becoming the beneficiaries of the Great Wealth Transfer. According to some estimates, $68 trillion in wealth is to be passed down from the baby boomers – the wealthiest generation ever – to their children and other heirs over the next couple of decades.
Furthermore, another major reason why NFTs are here to stay is that they are “positively changing business models,” especially in the creative industries.
Artists and musicians for example can provide enhanced virtual experiences for collectors and buyers, they can prove if their works are counterfeited, and they can include criteria to get royalties every time their works are re-sold in the future.
Nigel Green concludes: “With NFTs, we are experiencing the meeting of an internet of information with an internet of value, which is drawing in large investments coming from multinationals, funds, and VC firms, amongst others, into the market.
“However, the market remains young and highly speculative and caution should be exercised. It can be expected that some of the NFTs on the market now will have little value in a few years. But some will be worth a fortune. It’s a similar situation to websites in the early days of the internet.
“As with any kind of investment, the key is being able to pick the winners and avoid the losers in what is a volatile market driven by fast-changing trends and tastes.”
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Dormant Ether Holder Awakens, Transfers Nearly $90 Million to Kraken Exchange
A significant Ethereum (ETH) holder, dormant for five years, recently transferred almost $90 million worth of the token to the crypto exchange Kraken.
The on-chain analytics tool Lookonchain reported this development in the early hours of Tuesday, shedding light on the activities of this long-inactive “whale.”
A whale refers to an entity holding a substantial amount of any cryptocurrency.
Blockchain data reveals that during the Asian morning hours, the whale deposited 39,260 ether into Kraken. In 2017, this same address received 47,260 ether estimated at over $11 million at the time.
An early $ETH whale appears to be selling ETH again after being dormant for 5 years.
The whale received 47,260 $ETH($11.34M) at ~$240 from June to August 2017.
If sold the whale would make a profit of ~$78M. pic.twitter.com/v0PI4LNTKO
— Lookonchain (@lookonchain) December 5, 2023
Upon analyzing the address, it was discovered that previous transactions were not linked to the cold storage of any exchange.
However, there is a possibility of a connection to trading firm Cumberland as indicated by labeling on the data tool Arkham.
The significance of such a large holder moving assets to an exchange lies in the potential repercussions for the market.
When whales transfer funds to exchanges, it often raises speculation about selling pressure as the holder might either sell the tokens for stablecoins or convert them into other cryptocurrencies.
This event adds an element of intrigue to the cryptocurrency market as observers keenly watch for any subsequent market movements.
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