In announcing its annual 10-word shortlist in a November 24 blog post, Collins Dictionary has officially declared “NFT”, albeit an acronym, as its word of the year. “NFT” surpassed the likes of “crypto”, “metaverse” and “double-vaxxed” to claim the top spot.
2021: The Year of the NFT
Although technically an abbreviation, “NFT” is accepted shorthand for non-fungible token. Collins defines an NFT as “a unique digital certificate, registered in a blockchain, that is used to record the ownership of an asset such as an artwork or a collectible”. NFT is a noun that describes “an asset whose ownership is recorded by means of a non-fungible token”.
Collins continued to explain its view of what NFTs signify:
A chunk of digital data that records who a piece of digital work belongs to … what’s really captured the public’s imagination around NFTs is the use of this technology to sell art.Collins Dictionary
This has truly been the year of the NFT, with the assets amassing almost incomprehensible amounts of money and enticing a wave of celebrities, influencers and Web 3.0 fanatics to engage in the space. The market surged to new heights when it reported a trading volume of US$10.67 billion in Q3 alone – a 700 percent increase over Q2 2021.
Total sales for collective and art NFTs have surpassed US$7.4 billion for Q4, while art and collectible sales respectively generated US$17.8 million and US$55.5 million in comparison.
Collins cited infamous NFT artist Beeple as a key contributor to the space and made specific reference to his landmark magnum opus, “Everyday: The First 5000 Days”. The piece was auctioned off for a staggering US$69 million in March this year.
Other noteworthy crypto projects such as CryptoPunks and Bored Ape Yacht Club have also sold for unthinkable amounts of money and the avatars have become a “flex” for celebrities on Twitter. The likes of Quentin Tarantino and Martha Stewart have joined the race to launch their own set of NFTs, along with big brands such as Nike and Vodafone.
Scepticism Over NFTs is On the Rise
Although the NFT market has boomed in recent times, many are starting to doubt whether its massive upside can be sustained. Gary Vaynerchuk, aka Gary Vee, anticipates a bear market ahead for NFTs. He posits that too much short-term greed will likely result in a market downturn and a significant pullback in NFT valuation. Nonetheless, he has stated that he remains bullish on NFTs.
Many agree with Vee and consider the market is overheated. SynFutures is now looking to address concerns over the purpose of NFTs by launching NFTures, a product that will allow users to short the future prices of NFTs.
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