NFTs likely to stay afloat amid global odds

- Growing demand for blockchain domains

- This will open up a new market

- Gaming metaverses will continue to flourish

Mumbai: The year 2023 will be a blessing in disguise for non-fungible tokens (NFT), feel experts. They say the New Year has all the credentials it takes for transforming the perception, the possibilities, and the market for NFTs.

The year 2022 probably started on a very high note for NFTs, but the crypto winter and its shockwaves meant that even NFT sales were affected. While, on the surface, it might seem detrimental to NFTs, it has been a blessing in disguise.

Talking to Bizz Buzz, Kameshwaran Elangovan, Chief Operating Officer (COO) and Co-Founder, Guardianlink, says: "The recent crypto crisis meant that only legitimate and genuine products with a tangible roadmap can survive in the market. This has led to the initiation of a lot of meaningful NFT projects. While the market of standalone NFTs might have taken a beating, the fact that NFTs represent digital ownership has been strongly established."

A lot of brands, owing to the exclusivity congruent with the real-world experience in the digital space, have started to embrace metaverses and NFTs. This pattern will continue well into 2023, with more brands embracing this new digital practice, he said.

Perhaps one of the most transformative moments that will define NFTs in 2023 is the growing demand for blockchain domains. With the introduction of central bank digital currencies (CBDCs), it would become inevitable for people to have wallets for their digital money. This will open up a new market for blockchain domains which were dormant until recently.

In all of this, games and gaming metaverses will definitely continue to flourish. Just like the real world, you can expect partnerships, sponsorships, and collaborations between brands and metaverse / blockchain games, he added.

Though NFTs might not completely be pushed out of picture, their prominence might not be as intense as it was a couple of years ago. The NFT landscape will become more utility driven, holistic, and will create better opportunities for people to interact with and to establish a unique identity in the Web3 space.

Amanjot Malhotra, Country Head, Bitay India, says: "Although there's no doubt that the NFT market has taken a serious hit in 2022, some very bullish analysts and industry insiders still see 2023 as being much kinder to the market. This is so because NFTs are a crucial part of the digital economy, which seems destined to expand even if it doesn't become the 'parallel universe' equally important to today's market that some predict."

The theory behind this bullish outlook is that NFTs will continue to be adopted by video games, artwork, music, and digital collectible industries. If life becomes more virtual in the coming years - where consumers use virtual assets in the metaverse - NFTs may indeed have staying power. A report from Verified Market Research, for example, projects that the market value of NFTs will jump to $231 billion by 2030.

However, prices will need to reverse course before the hype returns to the sector. In November 2022, Google reported that searches for NFTs have dropped by 88 per cent in less than a year, perhaps the best real-world indicator of how interest in the sector is waning, he said.

NFTs always have been a speculative asset class, and they remain so. Regardless of whether price momentum returns to the sector or not, investors should prepare for volatility in NFT pricing in the foreseeable future.

The question investors have to answer for themselves is whether the plunging prices and trading volumes in 2022 are an indication of a bottom-out or just the beginning of the pain in the sector.

Abhay Aggarwal, Founder and CEO, Colexion, says: "Since non-fungible tokens grew remarkably in 2021, it has become common for projects from persons with little Web3 technology skills to have unrealistic expectations. People's and companies' perceptions of NFTs have shifted as a result of the severe crypto winter brought on by numerous geopolitical events."

This transformation has meant that only legitimate and genuine products with a tangible roadmap can survive in the market. This has led to the initiation of a lot of meaningful NFT projects. While the market of standalone NFTs might have taken a beating, the fact that NFTs represent digital ownership has been strongly established

-- Kameshwaran Elangovan, COO and Co-Founder, Guardianlink