The present NFT frenzy, according to VaynerMedia CEO and entrepreneur, is similar to the dot-com era stock market surge of the early 2000s.
“This is internet stocks [19]99,” said Vaynerchuk when asked about the current NFT landscape. “I put out content every week saying that 98% of [NFT] projects are going to zero. Most of the behavior I see in NFT buying reminds me of the way people bought beanie babies.”
“In March 2000 when all those internet stocks which were grossly overrated and collapsed, Amazon was sitting there at seven or eight dollars per share, the same thing will play out in the NFT space,” Vaynerchuk said
Vaynerchuk is the creator of the popular NFT series Vee Friends and has 2.9 million Twitter followers. A single Vee Friends NFT costs 13.25 ETH (about $41,000) at the moment.
He feels that digital assets are still in their infancy. He advised investors to accept that “things don’t make sense” right now, but that the NFTs will eventually become a powerful and established market.
Jonathan Victor, the Web3 startup Protocol Labs’ business development head for NFTs, feels that the NFT space is just getting started. He claims that once people stop focusing on the phrase “NFT,” most of the benefits will become apparent.
“People will stop talking about NFTs as NFTs, and the focus will shift to what they actually offer,” Victor told Insider. “Instead of just fixing on the term, we’ll look at what the digital objects can do for us.”
Victor showed how vaccine cards may have been enhanced if they were NFTs because they have built-in proof of ownership on the blockchain. People would be able to see who issued it, who it was assigned to, and when it was provided, all while reducing the risk of false cards.
He anticipates event or sports tickets to shift to NFTs for the same reasons.
“Soon NFTs will just be things we use in a time where everything will be digital and interoperable. We’ll eventually get less excited about the term ‘NFT,’ and people won’t even think about items as NFTs anymore.”
Similarly, Eric Chen, CEO of injection protocol, a decentralized trading platform, said there’s a lot of noise in the NFT industry that detracts from the value of digital assets. He expects widespread adoption of the technology in the future.
“The marketplace became overwhelmed,” Chen wrote to Insider in an email. Most of these NFT projects with little differentiation or innovation will likely die over time.”
“NFT” used to be a term only familiar to a small group of users,” Chen continued. “We’ve already seen the metaverse concept and NFT sector being validated by large traditional tech companies. I think it’ll grow slowly to become part of everyone’s daily life. I think it’ll be less flashy.”
Vaynerchuk believes that “short-term greed behavior” in the space will lead to an NFT decline. He expects a handful of operators to emerge on the other side with “amazing profits” once the dust settles.
The NFT industry grew to $41 billion in sales in 2021, almost matching the traditional art market, while celebrities and professional athletes continue to pour money into the embryonic Web3 space.
Over $535 million worth of NFTs were sold in the last week.