Big Apple Bummer: NFTs Shunned As Investors Recoil From Risk
Party Pooper
This week the NFT conference NFT.NYC kicked off its annual shindig. The get-together has been hosted in New York City since 2021 and brings together creators, influencers, and enthusiasts, indulging in all things NFT. The high-end world of classical music has even jumped into the virtual world as this year’s conference will feature the first-ever launch of Stradivarius Violin NFTs.
It’s less-than-optimal timing for the NFT market, however. The average NFT price has dropped by nearly 70% since April.
Similar to Crypto’s Crash
It seems the NFT market has caught crypto’s cold. Year to date, Bitcoin (BTC) has fallen by more than 50%. NFTs, which are largely transacted on the Ethereum (ETH) blockchain, have seen their sales drop at the same time. Ahead of this week’s conference in New York, NFT sales were down 150%, according to data aggregator CryptoSlam.
Last week’s rate hike that triggered a market sell-off may exacerbate the NFT space’s troubles. As investors shrink from risk, their appetite for what some deem speculative NFT plays may dwindle even further.
Greater Fool or Legit Upside?
Industry titans Bill Gates and Warren Buffet are not fans of NFT investments. Gates recently referred to them as illustrative of the “greater fool theory” wherein profits are only available if someone more foolish than the current owner will buy the product.
Others say, not so fast. They believe the current shake-up may force the market to evolve. One possibility is that NFTs are de-linked from crypto, thereby opening up the market to those who want to use traditional currency. Industry observers also envision NFTs offering more than just aesthetics, but rather provide access to experiences and perks, such as digital sports trading cards or access to unique gaming experiences. As market conditions evolve, the very new NFT will be forced to adapt.
Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
Communication of SoFi Wealth LLC an SEC Registered Investment Adviser
SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.
SOSS22062102
All your finances.
All in one app.
App Store rating
