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Why should you be aware of NFT trends? Whether you might agree with the concept of NFTs or otherwise, some of these forthcoming trends have the ability to revolutionize the way we interact with the web, brand things, purchase and trade art, and even produce and enjoy music. According to Jace Kay of the Bored Ape Yacht Club, 2023 appears to be the year when the potential of Web 3.0, as well as NFTs, will truly take off.
Following the emergence of NFTs, various novel applications of the concept have emerged. NFTs were first used in decentralized banking, art, video games, smart contracts, fundraisers, and many more fields in 2021. So, what good news does NFT provide for 2023? The following are a few of the major trends to watch for in 2023.
NFT loans are a novel use case, and investors are using their NFTs, as well as NFT collections, as leverage to get loans for new prospective investments and emergencies. Several DeFi (decentralized finance) systems were built in 2022 to allow the usage of NFTs as collateral for loans.
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For example, Arcade is a DeFi service that offers NFT-backed loans. After both the borrower and the lender have accepted the terms, the money is placed in an escrow account maintained by an Arcade smart contract. The NFT(s) remain locked up and irreversible until the payment is completely paid or defaulted.
NFT is yet another marketplace where users may utilize NFT resources as collateral to secure loans or lend to other users. Any ERC-721 token can be used as collateral in return for an ETH loan. When the loan is repaid, the NFT is refunded to the borrower. The item is handed to the lender if the debt is not repaid.
Different businesses from various sectors are showing interest in NFT, with each proposing new tactics to capture a piece of the action. Limited-edition NFT collections are being launched by food companies such as Taco Bell, McDonald’s, and Campbell’s, and also luxury labels such as Louis Vuitton, Nike, and Gucci, as a way to raise money for charity, establish new income streams, increase engagement on social media and improve brand loyalty.
Pringles® produced a digital compilation of crypto-themed crisps, CryptoCrisp, with a “virtual taste” restricted to 50 copies. The NFT is an MP4 file that depicts an animated revolving golden Pringles can having the “CryptoCrisp” taste. The CryptoCrisp NFTs cost the same as a regular Pringles can, or roughly 0.0013 ETH, or about $2. The NFTs are available on Rarible and OpenSea for as little as 4 ETH.
Using NFTs to develop brand value is the newest technique in many large businesses’ marketing playbooks, and it was not going away in 2022. Anticipate more label-specific NFTs to be issued by firms across all industries as marketers continue to explore the metaverse’s inventive branding possibilities.
Giving a community IP freedom to “twist and spin into new areas that the original brand would not have explored in the past adds value,” according to Kay. Using a blockchain with NFT provides primary and secondary resale rights, ensuring that an artist is always compensated for future use of the work. Losing ownership of an IP allows for development and creativity, and creators are compensated for their contributions and effort at every step.
“Take, for example, Bored Ape Yacht Club,” Kay adds. “It didn’t exist before May [2021], and now it’s one of the largest brands in the world, nearly, and it’s collaborated with Adidas and many others.”
Will Disney and other major corporations share their intellectual property with NFT communities? Although it seems unlikely, this strategy of community-led branding and marking will find a home with huge firms that will look to NFT organizations and communities to promote new goods. If you make a Bored Ape available for avatar casting, your work might be used in a Coke commercial next Christmas.
The metaverse will actually begin in 2023, and NFTs could be at the centre of this immersive technology. The benefits of blockchain, cryptocurrencies and NFTs will be supplied directly within the metaverse, quickly removing the voodoo barriers to entry. However, Kay feels that it all starts with Apple and their seamless attitude to UX and UI.
“The crucial point is that Apple, with its appropriate gadget, will drive things to a new level, just as they did with App Store,” Kay explains. The catch might be the rumoured price of the Apple VR gear, which is expected to cost a figure around $3000 for high-end AR/VR technology. Could this be the point at which Meta/Facebook and Oculus lead in VR headsets? Kay, on the other hand, is sceptical of the social media behemoth.
“They’re not just behind the curve but also on the losing end of it. They’re going to wreck the metaverse. Meta is a surefire prescription for disaster.” According to Kay, there will not be a single metaverse but rather a decentralized mix of applications, events, locations, and platforms. “Facebook will constantly attempt to make it its metaverse, and you may sell your NFTs in it, but it’s going to be centralized,” he continues.
NFTs provide us with a new universe of opportunities for crowdfunding, marketing, and monetizing television and film ventures. Some significant industry players have already begun to release NFT TV shows, including:
The NFT television broadcasts are merely one component of a much larger picture. There are other non-NFT TV shows based on NFT personalities, such as Time Studios’ Robotos TV series, which is currently being made by Time Studios, Time Magazine’s film and TV production firm. Many TV series and film projects are being supported by NFTs, like Men of the House, where the pilot episode was funded by NFT revenues.
NFTs have also found their way into TVs, with Samsung unveiling an “NFT Aggregation Platform” in its latest Appliances (The Frame TV, MICRO LED, and Neo QLED) due out in 2023. Viewers may use the capability to search for and buy NFTs on several markets directly from their television. It’s a big endorsement of NFT, arguably the clearest indication yet that the entertainment business and NFTs will only become more closely aligned in the future.
There have been a lot of rumours on the blockchain grapevine concerning Twitter, YouTube, and TikTok mixing in the NFT world in their ways — a well and much-anticipated development among social media enthusiasts.
In her yearly letter to creators, YouTube CEO Susan Wojcicki stated, “We’re also looking toward the future, and we’ve been following everything that’s happening with Web3 as a source of motivation to keep developing on YouTube.” The last year has shown a previously unseen opportunity to enhance the link between creators and their audience in cryptos, nonfungible tokens, and decentralized autonomous organizations (DAOs).”
Twitter has verified that NFTs may be used as profile images. You can use an NFT for your profile image after establishing a temporary link to your crypto wallet. Your virtual asset is configured to show in a distinctive hexagon form that distinguishes you as the NFT’s owner. This is supposed to alleviate the worries about identification and NFT fraud circulating on the site. Instagram is also taking selfies to new heights, with CEO Adam Mosseri saying that the business is researching NFT use cases.
Music NFTs taking over Kay and other Bored Apes have founded the virtual band The NFTs, and there is still more to come. NFTs, on the other hand, will be more widely used in the music industry. Jack Dorsey resigned as CEO of Twitter to manage Block (previously Square (opens in new tab)), with the goal of convincing streaming providers such as Tidal to embrace music NFTs.
Stationhead, a real-time music and broadcast platform is Kay’s other initiative, in addition to the StereoheadZ NFT, a decentralized music label and community. Stationhead allows you to legally broadcast live performances and stream music via Apple Music or Spotify.
Channels like Stationhead shall exist in and throughout the metaverse, allowing listeners to interact and share their music. Blockchain-based NFTs will be used to incentivize fans who monitor a band or to track royalties for artists.
Kay’s group Fans who follow the band via the StereoheadZ Song Club NFT get prizes and may even be chosen to help improve the band — Kay claims the animation for a forthcoming music video could be found at the SZMC.
While crypto investors have been concerned about regulation for many years, the government’s interest in controlling NFTs is a relatively recent occurrence. Regulators are wary of the $20 billion+ NFT industry since NFTs are acquired and sold using cryptocurrencies, and the wallets used for this purpose are (in most cases) anonymous.
The US Treasury Department, in particular, has produced research underlining the fact that NFTs can be used to both launder wealth and finance terrorist operations.
On the one hand, authorities have been repeating the same statements for years about Bitcoin. On the other hand, it’s easy to understand how repeated press stories about seven, eight, or even nine-figure NFT purchases may appear suspect. Furthermore, not all restrictions target illegal activities.
The Financial Action Task Force in France aims to explain how NFTs should be classed and what particular criteria indicate if an NFT is a virtual commodity, security, or something else.
The Securities and Exchange Commission of the United States is also seeking to determine which NFTs can and cannot be deemed securities.
Finally, in 2021, there were several court conflicts over who owned what when it came to NFTs. As an example, a group called Spice DAO just acquired an unpublished screenplay of the immensely popular 2021 film “Dune”. That assumption was erroneous, resulting in a well-known tale where the Spice DAO owners were forced to abandon a planned cartoon series.
Blockchain subdomains have become a popular item in a less spectacular but more practical use of NFT technology. If you’ve ever used a crypto wallet, you know how difficult it is to remember the “address” of your wallet because crypto wallet addresses are made up of a random collection of 30+ characters.
To alleviate this annoyance, a few organizations developed what is currently called Blockchain Domain Names. Blockchain domain names, unlike regular.com domain names, are not utilized to host websites. Blockchain domain names, on the other hand, are ERC-721 tokens (the innovation underpinning NFTs) that serve as link tags for crypto wallet addresses.
For example, suppose John Doe wishes to obtain $100 in BTC from Jane Doe. In the absence of a blockchain domain name, John would need to sign into the wallet, copy the address, and then text or email it to Jane (who would then need to replicate it into her cryptocurrency wallet to complete the transfer).
Blockchain domain names, on the other hand, make this procedure far more manageable. Instead of looking up and sharing his address, John might just tell Jane that he has JohnDoe.Bitcoin. Jane might then transfer the $100 directly to John’s domain name (which would transfer the $100 into John’s Bitcoin wallet). Because of this simplicity, many cryptocurrency users are securing their domains. In fact, Unstoppable Domains is ranked in the top 15,000 sites in the globe. The same can be said for Ethereum Name Service, a blockchain domain name provider whose crypto token ($ENS) recently surpassed a billion-dollar market worth.
The benefit of NFTs, unlike traditional IP development, is that you may own a portion of a more prominent brand and gain from it. NFTs like Bored Ape Yacht Club as well as StereoheadZ allow users to mint their work for the group, injecting fresh life into a community of artists, animators, and musicians.
The personality Avatars for Jace Kay’s NFTs band were obtained from the community, and monies were repaid to those artists. It helped that a previously unknown rock star was a member of the StereoheadZ Music Club.
Expect more of the “Avatar Casting,” as Kay refers to it, to take off in 2023. He and the BAYC are working on several initiatives, and members may also put up the Bored Apes or StereoheadZ for usage and receive a portion of the earnings.
When the initial generation of projects began in 2017, the fees for purchasing and selling NFTs, which required transactions on the Ethereum blockchain, were negligible.
Remember the summer of 2021, when the NFT Mania boom began, and those identical fees had risen into the hundreds (or even thousands) of dollars.
While this was only a minor annoyance for crypto billionaires and dedicated flippers (some of which make several hundred thousand dollars), the fees constituted a significant barrier to entry for normal investors. To remedy this issue, NFT developers began establishing their applications on less expensive blockchains.
Many of these ventures failed to acquire momentum in the beginning. However, the sub-dollar costs associated with dealing on alternate chains drew a growing list of NFT collectors who could not (or would not) transact on Ethereum.
Several hundred million dollars in NFT volume are currently processed through alternative chain platforms. Solana-based NFT exchange Solanart, for example, has handled more than $544 million in revenue volume since its inception in June 2021. Similarly, SolSea (whose name is a play on the industry-leading OpenSea platform) has over four million website views each month.
NFT tracker CryptoSlam revealed in January 2022 that Solana NFT volume had topped $1 billion for the first time. While not as prominent, NFTs founded on the Avalanche blockchain have generated $400 million in sales volume.
To be sure, Ethereum developers are working hard to reduce transaction fees on their network. Nevertheless, as NFTs on alternative, reduced-cost chains gain popularity, investors and average crypto users are concerned that it may be too little, too late.
It’s no wonder that venture capitalists are attempting to cash in on the NFT mania. The trend began modestly, with industry heavyweight Andreessen Horowitz investing $23 million in OpenSea in its Series A round. Since then, VC investments in the NFT industry have increased in both regularity and financial value.
Velvet Sea Adventures as well as 01 Advisors (aka O1A) revealed in February 2022 that they will invest $100 million in NFT network Pixel Vault, Inc. The project’s purpose is to use Pixel Vault’s current intellectual property (particularly superhero NFTs) to produce a comic book-style series that chronicles important business events (and drama) in Web3.
Simultaneously, Andreessen Horowitz, as well as Kleiner Perkins, announced a $170 million Series B investment in Tom Brady’s NFT initiative, Autograph. “Autograph brings together some of the most famous brands and renowned names in sports, entertainment, and culture to produce unique virtual collections and experiences,” according to its website. In contrast to other initiatives, Autograph NFTs involve more than simply “ownership” of digital art.
Instead, customers have access to unique material, secret forums, and in-person interactions with the NFT artists themselves. Purchasing one of Tom Brady’s limited edition Ruby NFTs, for example, entitles customers to Early Bird connectivity to future NFT drops as well as membership in a special Discord group.
Yuga Labs, the firm behind the currently famous Bored Ape Yacht Club (BAYC) NFT collection, is seeking a $5 billion investment in what may be the biggest investment into an NFT project ever. Yuga, unlike the majority of the ventures in which VC is funding, does not maintain or run an NFT exchange.
Instead, as the project’s developers, they receive royalties any time a BAYC NFT is traded. Furthermore, with more celebrities buying BAYC NFTs every month, the brand Bored Ape Yacht Club is growing increasingly valued. As a result, it’s reasonable to expect Yuga Labs to generate money through licensing partnerships.
NFTs appear to be sweeping the public, from venture capital firms and sports stars to ordinary Joe collectors. This is a macro trend that we anticipate will persist until 2023 and beyond. These trends will continue indefinitely since NFTs are always improving, and new use cases may be introduced in the years ahead. One thing that has been consistent about NFTs over the past year is their growing popularity and steady expansion.
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