While NFTs have been around for a pretty long time, just a few knew about it. However, there has been an explosion in the popularity of NFTs. Ratings on search engines have revealed an exponential increase in the number of times that searches for NFT are made. This spike in popularity followed relatively dormant months. In fact, people were already saying that NFTs are on fire. This has been proven by the recent Google Trends’ metrics. First, it is important to talk a bit about NFTs.
NFT is the short form for Non-Fungible Token. Trying to understand the meaning of NFTs will be made much easier if we know the meaning of ‘Fungible’. From our knowledge of basic Economics, ‘Fungible’ asset is something with units that can readily be interchanged such as money. The opposite is the case with ‘Non-fungible’ assets – they are things that can’t readily be interchanged like a house or a piece of painting. A $20 bill can be exchanged for two $10 bills without a change in its value. This is because fiat currencies are fungible.
In the digital world, NFTs are seen as assets that can be bought and sold like any other piece of property, but which have no tangible form of their own. They are more like certificate of ownership for virtual or physical assets. Take Madonna of the Rocks for an example; one can take photos of it or buy prints of it but the original painting remains only one. This is exactly what Non-Fungible Tokens are.
Global interest in NFTs reached 426% in one month. Such interest surpassed the ones in terms like DeFi, Ethereum, and Blockchain. According to a research by wette.de, the global NFT market has a market capitalization of US$43.08 billion as of October 2021 with trading volume around US$3.6 billion. Between January and October of 2021, weekly NFT sales range between US$10 million and US$20 million. For some weeks within this period, sales spiked to as high as US$170 million. For instance, between the end of April 2021 and the end of May 2021, weekly trading volume rose from US$50 million to nearly US$200 million, a stunning 300% rise.
At the beginning of August 2021, the keyword “how to buy NFT” had 20 searches. This figure was increased five times (5X) by August 29, bringing it to 100. For perspective, the level of search interest is measured in points, with 0 being the lowest and 100, the highest. Having sold 1,346 artworks, Beeple ranked first on the list of top NFT artists with total artwork value of US$145.03 million as at October 2021. Pak followed at a distance with total artwork value of US$56.41 million. The Asian region has the biggest search queries for “non-fungible token” and “NFT” terms.
A Chinese conglomerate, Tencent recently launched an NFT marketplace. Of course, other exchanges are doing same and giving NFTs the required wings to fly. Coinbase, Binance and OpenSea have established markets for the sales and exchange of NFTs. Another important factor which has contributed to the explosion of NFTs in popularity and search is celebrities’ involvement in the show. Some of them are actively launching their own NFT’s arts, which is attracting a new audience to a relatively brand-new concept for the mainstream.
It’s not surprising that “NFT” and “non-fungible token” terms compete with Ethereum, given that this last one supports Ether (ETH) – the cryptocurrency widely used for NFT-related transactions. As many marketplaces keep providing platforms and celebrities getting involved, this buzz is sure to rise. Whether you are buying or creating your own NFT, doing so now won’t hurt at all.