In the letter
- The new NFT project, Bitcolers, wants to give users the ability to own and trade colors as NFT tokens.
- Similar to CryptoPunks, early adopters may be up for some huge ROI.
NFTs are still such a big deal
After Beeple’s $ 69.3 million NFT sale in March, the digital art market seems to have gone into an overdrive mode. In the first half of 2021, the market for non-fungible tokens (NFTs) has grown to 2.5 billion. By comparison, sales in the global NFT market were 8 8 million in 2080.
Creating new NFTs at record speeds from investors to digital artists by spending millions of dollars on CryptoPunks, one can assume that the frenzy is just beginning. However, some industry experts have argued that the NFT flame will eventually burn. Lightcoin’s Charlie Lee, for example, predicts that the value of most non-fungi tokens will eventually fall to zero as supply demand declines. He wrote:
“The problem with NFTs is that they are unlimited tokens. There is zero cost in creating an unlimited number of tokens.”
For some contexts, a non-fungible token is a crypto resource that is used to present an image, in-game item, real-life artwork, or even real estate, such as a real or invisible item. NFT’s assets and ownership are recorded in a blockchain, which allows it to trade as a stand-in for the item it represents.
Will investors lose money?
The current NFT landscape is primarily the spread of cryptopunks and several other successful collections. For the most part, these copy and paste projects do not bring anything new, instead, they rely on randomly generated avatars. Based on this argument, Lee is somewhat correct.
On the other hand, it would be wrong to dismiss the entire NFT market on the basis of the expansion of the digital industry and on the basis of several cryptocurrency onabases. That being said, the next million dollar NFT project certainly can’t be a 24 × 24 pixel art image that’s wrong and weird or a 5000 piece collage. It could be something completely out of the box.
Innovation will rule the scenes
Speaking of out of the box, a new NFT project looks at the past of the digital industry. The project, known as Bitcolers, has a collection of 1,000 handmade NFT colors. Thus they are creating a rabbit hole where users are allowed to own and trade the color.
BitColors is introducing a new angle for NFT frenzy because there is currently no other project like it. Considering its early-mover advantage, early adopters may be able to replicate the success of projects like CryptoPunks in the form of an index ROI.
Each color in the collection is handmade, with no artificially predefined features that have no soul in them. Bitcolers users have the freedom to price each color based on their own feelings. In general, this seems to be an art project that could attract auction houses like Christie’s, Hermitage and Sotheby’s.
Another interesting aspect of BitColors is that it has kept its collection size relatively small. With just 1,000 NFT, the project introduces a component of the lack of future value of its tokens.
NFTs are definitely here to stay. The technology underlying the sector packs such immense potential. Although the moment is to try to buy an NFT at a cheaper price and reverse it for massive profits, the future and potential use of the sector will probably extend beyond what we know. In the long run, only projects that bring something unique to the table will stand the test of time.
Image by garageband from Pixabay