The crypto market is known for being volatile, and the NFT marketplace contains many of the same risk factors. While cryptocurrency is gaining a better reputation within the financial sector, NFTs are still often written off as scams. This view has been reinforced by a major dip in the market in 2023. Experts are now looking toward the future and predicting what may change in the NFT market in 2024.
The most well-known NFT marketplace, OpenSea, set the tone for the NFT market when it laid off a massive amount of staff last October. While the crypto market boomed, the NFT market was looking somewhat dismal. However, predictions for the future are optimistic. Nansen recorded an upswing in volume last fall and cautiously announced that the NFT market could be experiencing a resurgence. The analytics platform pointed to the climbing prices of Bitcoin, Ethereum, and Solana as possible incentives for NFT traders. As cryptocurrencies gain more legitimacy, the hope is that NFTs will as well.
According to Forbes, experts are predicting that the NFT market will double in the next three years, from $1.6 billion in 2023 to $3.2 billion in 2027. This forecast is dependent on crypto becoming more mainstream, with proper regulations and respect in the financial community. The recent Bitcoin ETFs are pushing Bitcoin and other crypto prices up as well as lending a new level of legitimacy to the entire crypto market. This is spreading to NFTs, albeit on a smaller scale. Matt Medved, co-founder and CEO of NFT Now, emphasized that educating the masses about NFTs is crucial to growing the market in an interview with Forbes. The power of digital ownership is misunderstood by many who look at NFTs the way they used to look at crypto.
NFTs, or non-fungible tokens, give artists the chance to establish digital ownership over their work while creating revenue streams. Digital art is very difficult to monetize, copyright, and establish ownership over. NFTs can help artists with all of these issues. In the future, NFTs have the potential to be integrated with real-world assets and be better regulated, leading to more legitimacy. If they follow the same path as cryptocurrencies, NFTs will become more attractive assets to prolific investors and become exciting trade opportunities.
Integration with real-world assets unveils a vast array of possibilities for NFTs. It would mean that physical assets—digital artwork or physical artwork—could be transformed into assets with liquidity on the blockchain. This would expand the scope of NFTs while emphasizing the relationship between traditional and cryptocurrencies. Similar to companies building a crypto portfolio with real estate assets, this integration would show people that digital assets have the same power as real-world assets.
If this pattern continues and the public becomes more educated and enthusiastic about NFTs, the NFT market could easily reach the projected $3.2 billion by 2027. While Bitcoin continues to gain ground in the battle for ETF approval and pave the road for the legitimacy of digital assets, there’s no reason why NFTs couldn’t be next.
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