In 2022, NFTs will be commonplace.
The ability to create unique digital representations of real-world items and assets has been a long time coming. The concept has been around since the early days of blockchain, over 7 years ago, but only recently have we seen mass adoption of this technology.
The explosion in NFT collectibles started with CryptoKitties back in 2017. Since then, some of the biggest names in tech have jumped on board; Visa recently bought an NFT for $165,000. Now, you can even buy a piece of virtual real estate as an NFT, from the French Chateaux to the Great Wall of China, with Next Earth.
But a year from now you will see them everywhere; in movies, TV shows, books, and more – all represented as an NFT. NFTs are becoming mainstream because they allow people to own something that represents a part of something bigger than themselves – a piece of art or a character for example.
NFTs and the Digital Economy
NFTs are part of the digital economy. The digital economy is made up of a variety of online markets, including game economies, virtual real estate, and even social media platforms like Facebook.
The rise of the digital economy has been one of the most significant developments in recent years. It’s predicted that by 2027, there will be $7 trillion worth of digital goods traded on virtual marketplaces worldwide. And as we’ve seen with other types of commerce, the more consumers engage with these marketplaces, the more valuable they become to both creators and consumers.
In 2022, it’s expected that NFTs will continue to grow within this ecosystem. In particular: NFTs will become a standard feature on many platforms. Further, Virtual Reality content creators will increasingly create experiences using NFTs as an additional monetization tool to complement their existing revenue streams.
New NFT Business Models
There are two traditional NFT business models: The Supply Chain model and the Peer-to-Peer model.
In the traditional Supply Chain approach, an artist sells a digital work and the revenue is shared between the artist and the intermediary (e.g., app developer, platform owner). In this model, both parties share in the risk of selling a digital work that may not be fully monetized or may not generate enough revenue to justify their involvement.
In the Peer-to-Peer (P2P) model, also known as the “flipping” model, a user can buy a digital work from somebody else, such as via Next Earth’s NFT marketplace.
In 2022, we’ll see the rise of new models, like the affiliate/network model. Instead of dealing with an intermediary, you deal directly with another party who distributes your digital work for you—for example, you can use influencer marketing to distribute your digital artworks through various social media platforms like YouTube and Instagram.
In 2022, there will be many more entrants into these spaces because it will become easier for artists to release their artworks digitally using existing technology. Once artists realize how easy it is to release their artworks digitally using existing technology they will begin releasing more artworks digitally in 2022 than ever before—therefore creating massive amounts of demand for NFTs as people look for unique ways to express themselves through artwork.
NFTs Will Beat Traditional Collectibles
The current hype around NFTs is unprecedented. A recent survey shows that a staggering fifth of Americans know about the NFT space. This is a very positive sign as it means that Millennials are starting to realize how much they can buy with their digital footprint, and what they can do with it once they have it.
Our society has changed rapidly over the past decade, especially since the 2008-2009 economic crisis and the more recent pandemic. The way we live our lives has dramatically altered, from where we work to how we socialize. The same holds true for our consumer habits; people now spend more time on their mobile devices than ever before, and technology has made them more connected than ever before.
All these trends are coming together to shape a world where NFTs will beat traditional collectibles. Overall, 2022 is geared up to be a tremendous year for NFTs.