Bits and Bytes become Property- NFTs soar to redefine
NFTs are unique blockchain-based tokens used to certify authenticity and ownership of digital assets. Digital collectibles rose to mainstream prominence in 2020 with the total value of NFT transactions quadrupling to $250M. This trend has only become more pronounced in 2021 with NFT sales volume exceeding $220M in the month of March alone.
Investor interest has ballooned in 2021 with VCs looking to get in a rapidly growing space Dapper Labs, the creator of NBA Top Shots, raised $305M at a valuation of $2.6B. The public beta testing phase for the virtual NBA trading card site only began in Oct ’20 but it has already registered over 8,00,000 accounts and recorded over $500M in sales. Some of the sought-after NBA licensed ‘Moments’ sell for over $2,00,000 and have made early adopters millionaires. This rapid rise in popularity is reflected in the website traffic which has grown by 18x over the past 6 months.
Where the NBA leads, European football can never be far behind. French virtual Football digital collectible platform, Sorare raised $50M in Series A funding to grow its partnerships with elite European clubs, expand its workforce and launch a mobile app. It has seen its website traffic grow 286% in the last 6 months which is tangibly reflected in 52% MoM growth in revenue over the last 12 months.
The applicability of NFTs is not restricted to sports. Nifty Gateway featured an art collection and digital artwork pieces were sold for as much as $6.6M. Enjin raised $18.9M to launch an NFT blockchain on the Polkadot network to make a robust and secure commercial network for in-game tokens and collectibles, and create an unprecedented gaming multiverse. The unbounded scope of the NFT marketplace is attested by OpenSea which aims to be the ‘Amazon of NFTs’ and sells all sorts of digital collectables on its marketplace. Opensea raised $23M in a round led by A16z Crypto to keep pace with the explosive growth in the space which has seen total sales grow 100-fold in the past 6 months. Nifty Gateway, Enjin and Opensea have seen their website traffic grow by 1691%, 343% and 565% respectively over the past six months.
With IBM’s blockchain group partnering with IPwe to turn patents into NFTs to increase their liquidity for investors and unlock a trillion dollars in locked patents, NFTs seem to be far from just another crypto-fad. As the financial world trends towards digitization and blockchain adoption, NFTs look like a crucial part of the puzzle.
