It is obvious that the bears have been in control of the cryptocurrency market for the majority of 2022. As a result, the business has become fairly monotonous. NFTs, which first attracted attention in 2021, were anticipated to gain popularity in the future, but the bear market disproved predictions.
NFT sales were on a downward trend throughout 2022. Major NFT collections’ prices fell, leaving owners in the red. Even public figures and well-known brands released their own NFT collections due to the hype surrounding NFTs. However, since most holders were losing money, the declining prices were not in their favor. The BAYC and CryptoPunks were two well-known collections, and their prices were also plunging.
The same goes for the metaverse, as both of these technologies were at a point where they seemed less relevant. Moving forward in 2023, what can we expect from the NFT and Metaverse industries? Let us find out.
Is it the end of the NFT hype?
The prominence and relevance that NFTs had during their inception and through 2021 has seemed to diminish recently. Even though for the past two months there has been a spike in the NFT trading volume due to the release of the Donald trump NFT collection and a few others, they were not sustainable.
The same goes for the metaverse industry, where prominent tech and social media firms, including Facebook and Mark Zuckerberg, placed it under the spotlight.
NFT sales at one time were mind-blowing at times, when people sold NFTs for hundreds of thousands of dollars. But, all that noise seems to have settled now. Is the storm over? Before we dive deeper into the specifics, let us understand the basics.
NFT in a nutshell
Even though NFTs are a part of the whole cryptocurrency realm, they are quite different from traditional crypto assets. NFTs, short for non-fungible tokens, are nothing but certificates of ownership of an image, music, or any other digital content stored on the blockchain.
However, NFTs really started gaining traction when some notable NFTs were sold for numbers that were mind-boggling. This hype soon began spreading like wildfire, and artists and celebrities started jumping on the bandwagon.
On the flip side, several artists also thought this was a great opportunity to elevate their careers and reach a wider audience globally.
Metaverse in a nutshell
When the metaverse gained popularity in 2021, there were some key features that set it apart and made it so popular. The metaverse provided users with a 3D virtual experience where they could do literally anything, including shopping, singing, dancing, and eating while sitting at home.
The Metaverse is unique in that your avatar would roam the space while interacting with other avatars. Neal Stephenson coined the phrase in his 1992 book, “Snow Crash”. Additionally, in 2021 and 2022, a variety of media outlets referred to a wide range of Web3 social interaction platforms collectively as the “Metaverse.”
Metaverse hype soon began gaining traction, and almost all of the top brands started filing for trademarks, setting up shops, and doing all sorts of things in the virtual world.
Will NFT and Metaverse resurrect in 2023?
It should be noted that 2022 has been one of the worst years for the cryptocurrency industry. The prolonged bear market, accompanied by the fall of the Terra ecosystem in May and the recent fall of FTX, made things worse.
The extended bear market has had a negative effect on the prices of cryptocurrencies, and it has also been bad for investors and cryptocurrency businesses. The falling popularity of NFTs and Metaverse can also be attributed to the “crypto winter”.
The NFT and metaverse industries are massive, and they are not likely to go away anytime soon. Even amidst the troubled market conditions, Binance recently announced a new NFT staking program for BAYC-issued NFTs. The new staking program allowed owners of BAYC and MAYC NFTs to stake their NFTs and earn rewards.
Looking forward to 2023, positive market conditions and the bullish rally of cryptocurrencies will definitely be the best for the industry as a whole. The NFT and Metaverse industries are likely to gain traction and resurrect if the markets turn bullish. This could also help in pumping up the prices of major NFT collections, which will also attract other potential artists to release new collections and new companies to come up with new developments for the metaverse.