Everyone is jumping into NFTs, including GameStop
GameStop’s newfound love for technology — fueled by its need to stay relevant — led it to entering the NFT universe. GameStop announced plans to launch a virtual game NFT marketplace — jumping over 20% on the news, just to fall flat again.
Believer, skeptic or clueless of NFTs
Non-fungible tokens (NFTs) is the tech used to uniquely identify a digital file (i.e. picture, audio file, text file, etc). With a set of code, anyone in the world can see who owns a digital item.
In 2021, digital art made NFTs mainstream — but their use expands into music copyright, intellectual property ownership and beyond. Like most new technology, it’s controversial:
- NFT skeptics: “This is stupid — why are people paying millions for a digital picture?”
- NFT believers: The technology has many practical use cases — and everything can and will be turned into one.
Some online communities are using NFTs to give incentives and create engagement — i.e. own an NFT and gain features in a game or access to a community.
Celebrities are jumping in — paying 6 figures for crypto punks —, as are companies, using it as promotional tactics.
Selling NFTs is a big business
GME is close to inking partnerships with two crypto companies to develop crypto games (via WSJ) — investing tens of millions of dollars in NFT-related projects.
Crypto-gaming — powered by NFTs — allows people to resell in-game items. Several companies are racing to become the marketplace to buy/sell these items:
- OpenSea (not public) — the largest NFT marketplace — was recently valued at $13B.
- Rarible ($RARI) is one of the largest in the space.
- Virtual world platforms, like Decentraland ($MANA), have their own marketplace.
The NFT market exploded in 2021, with DappRadar estimating NFT trading volumes reached $22B in 2021 — so where does this put us?
Investors: Digital wild west
The consensus among the crypto community: NFTs are in a bubble — but there’s value in the underlying technology.
The crypto exchange, Coinbase (NASDAQ:COIN), is developing its own NFT marketplace with over 2.5M people on the waitlist but unless you’re investing in crypto, it’s difficult to get exposure to NFTs.
The industry is still in early development, with its long-term value or practical application uncertain Regardless, the future is likely to look very different.