NFTs Are Dead and No One Cares
Nyan Cat never stood a chance
I hate NFTs.
They’re not fun to talk about, only make fun of. Let me prove my point by talking about socks…
Yes, you read that right. In 2019, DeFi (decentralized finance) protocol Uniswap launched Unisocks — a limited edition non-fungible token that came with a physical pair of socks.
Back in February one SOCK token traded at $92,000.
“500 pairs of digital socks have a market cap of $20 million. Memes are the new money”, wrote Meltem Demirors, Chief Strategy Officer at Coinshares.
When socks are selling near six figures you know you’re in a bubble on steroids and possibly on crack. So let’s talk about why NFTs are dead and why I’m investing anyway.
Do We Need NFTs (or Are They Vaporware)?
Collectible cats… that was the first non-fungible token (NFT) project ever created.
Color me shocked!
It was called “CryptoKitties” and according to former Bloomberg journalist Camilla Russo, CryptoKitties accounted for about 15 percent of total Ethereum transactions in the first year and slowed confirmation times to several hours.
People were rightfully pissed. This isn’t to say, however, that what the CryptoKitty dev team did wasn’t impressive. It was!
They created an entirely new token standard called ERC-721. Instead of these coins being replicable like ERC-20 tokens (e.g. ETH, DAI, BAT), ERC-721 tokens represented scarce high-value items like artwork, internet history and socks!
However, the Ethereum community felt as many of us do now, that these inventions were useless, including Ethereum founder Vitalik Buterin.
“I was definitely surprised by NFTs… I was on record saying NFTs are overrated,” Buterin said on the Lex Fridman podcast. “I guess I just can’t personally relate to this concept of spending a lot of money on a thing and there’s no clear understanding why it would maintain its value.”
That’s like Bill Gates saying Xbox was a dumb invention.
Not a good look.
Why NFTs, as we know them, Are Dead
Vitalik believed NFTs were garbage because they didn’t have any utility.
He was right.
90% of NFTs are useless. And this is why utility-driven NFTs are beginning to emerge and dominate the market.
Anyone can pay thousands of ETH for a picture of Elon Musk smoking a joint or Vitalik wearing a cat t-shirt, but not everyone can own an NFT that actually does something in the real world.
So, Imagine this…
What if concert tickets were sold as NFTs?
Imagine seeing Freddie Mercury in 1985 and holding onto that NFT-ticket now. You’d have one of the most valuable NFTs on the planet.
Imagine if, in addition to handing out diplomas, colleges included NFTs as well. Especially in the wake of online schools, why wouldn’t colleges send a non-fungible virtual asset that could be backed by digital signatures?
Education would become more collectible and valued.
Concert tickets, college degrees, medical records, deeds to your house, music albums, and vehicle titles will all become NFTs.
Unique items in the real world will become NFTs in the digital one. Yes, we’re living in an episode of Black Mirror.
These Are The Projects to Look Out For
In the hands of a master, social media is more valuable than gold
One look at your social media page reveals your vibe, energy, type of experiences you’ve encountered, and who’s in your network. There’s more you online than there is in real life.
Now, what’s stopping people from using NFTs as an extra avenue to express their personality online?
If I saw someone had a Frank Ocean concert ticket NFT or an NFT from my favorite restaurant I could instantly and easily relate to them. NFTs are the best networking tools since the invention of social media.
Here are the utility-driven NFTs I’m eyeballing —
➰Enjin: Released in 2009 and later modified to run on Ethereum’s blockchain, Enjin allows software developers to create NFT-based video games. In short, think of this project as crypto-Steam, except that it also provides developer tools to create games. Moreover, its ENJ token is deflationary making this my favorite NFT project by far.
➰VeeFriends: Gary Vee is obsessed with NFTs. He’s the one that rewired my brain to look at them differently. His own NFT venture “VeeFriends” is a utility-driven series of unique characters that unlocks a three-year access pass to attend VeeCon from 2022 to 2024. Anything that this man touches turns to gold. Pay attention.
➰Mirror.xyz: Tim Denning was the first to bring this project to my attention, as it’s the first to combine NFTs with writing. Mirror offers a weekly writing competition with the winner receiving a $WRITE token to publish their work. The project is very low-key, but seeing as there’s only been a handful of competitions, the $WRITE tokens could become very valuable.
➰ Decentraland: Ethereum’s most popular video game is one giant NFT project offering virtual real estate, which many have turned into a means of earning passive income. I think the game itself is boring, however, the prospect of owning scarce virtual land does excite me (maybe I can even feed my virtual family with virtual corn).
Closing Thoughts
To be frank… most NFTs are a fad that won't ever make it. They’re 2020s beanie babies or the next fidget spinner. They’re a waste of money.
Utility-driven NFTs — now that’s a different story.
The future of NFTs is less Nyan Cat and more NSYNC. They are tickets to reunion concerts that you resell for thousands or a means to exclusify your content (yes, I made up that word and sticking with it!)
When investing in NFTs, don’t look at which one is cool or sparkles the most, ask yourself what will this do for me and my networkability?
NFTs could be bigger than crypto, there I said it. Now get off the internet and go crush your day.
Ever since I was a child it was my dream to become a financial advisor. Unfortunately, it never came true. Therefore I am not a financial advisor and you should do your own research and not just listen to random people on the internet. Nothing contained in this publication should be construed as investment advice.
Join 1500+ people on my newsletter for a free copy of my eBook “Mind and Muscle.”
