It’s truly been a whirlwind year for non-fungible tokens (NFTs). These assets, which famously can’t be exchanged for others due to their uniqueness, have become more than just a fad. NFTs are here for the long haul, and everyone should get used to them.
Like cryptocurrencies before them, NFTs have quickly become something of a growing trend. From musicians and artists to some of the biggest brands in the world, everyone is cashing in on the NFT craze. So, it’s no surprise that “NFT” is the Word of the Year.
And the Winner Is…… “NFT”
This month, the Collins Dictionary officially unveiled its annual shortlist of the most popular words. The shortlist included some of the top trending words in the year, but none had more eyeballs than “NFT.”
While “NFT '' itself is an abbreviation, the dictionary explained that it still qualifies. It surpassed several other trending words - such as “hybrid working,” “metaverse,” and “crypto” for the title. In its blog post, the Collins Dictionary explained that several concepts have shown the possibility of delivering a financial revolution by combining money with the internet. One such concept is the growing trend of NFTs.
For its definition, the Collins Dictionary claims that an NFT is a “ unique digital certificate, registered in a blockchain, that is used to record ownership of an asset such as an artwork or a collectible.” The dictionary added in its blog post that NFTs signify a chunk of digital data that records the data's ownership.
The Collins Dictionary added that NFTs have grown in popularity this year due to their affiliation with digital art. The dictionary was quick to point out “Everydays: The First 5000 Days” - an art piece from the infamous artist Beeple that sold for a record of $69 million back in March. While the claim about digital art is certainly true, many in the crypto industry have been quick to point out that NFTs can apply to many different fields.
A Growing Yet Nascent Industry
NFT enthusiasts will say this milestone was a bit expected. NFTs exploded in popularity this year, many of them selling for incredibly high prices. For artists, NFTs offer an opportunity to make money without having to give up intellectual property or share any profits from their work.
Considering that the art community is highly active online, it didn’t take long for NFTs to catch on. From social media, the word about NFTs spread like wildfire.
Today, some of the biggest platforms in the NFT space are doing alright. The on-chain music distribution platform Royal announced a Series A funding round this month. Royal allows fans to buy rights to music using NFTs. In its announcement, the company claimed to have raised $55 million in its funding round - just a few months after raising $16 million in a separate seed round.
Royal raised funds from several prominent investors, including Andreessen Horowitz, Coinbase Ventures, Founders Fund, and more. The platform also got backing from artists like Nas, Logic, The Chainsmokers, and more.
Royal’s funding round is in addition to several other top NFT marketplaces. The France-based NFT marketplace Sorare raised $680 million in September - a move that valued the company at an impressive $4.3 billion.
Sorare runs a fantasy football platform where digital cards are registered as unique tokens on the Ethereum blockchain. The cards, essentially NFTs, are tradable, and Sorare’s ability to strike deals with some of the biggest European clubs puts it at a great advantage.
Everyone’s Jumping on the NFT Train
Interestingly, the growth in NFTs isn’t confined to the West. Recently, the major Japanese crypto exchange BitBank published the results of a survey showing that about 26 percent of all Japanese crypto investors have had exposure to NFTs.
Explaining the survey results, BitBank claimed to have taken responses from 2,061 crypto users between October 26th and November 1st. The respondents included its own clients as well as several random crypto users polled via social media.
The survey revealed that 26 percent of Japanese crypto investors have held NFTs at some point, many participants being between the age of 20 and 40. For most of these respondents, the reason for holding NFTs was their similarity to traditional cryptocurrencies. They believe that NFTs are a good long-term investment, with up to 60 percent of participants expressing their desire to keep their NFTs for the long haul.