Despite the crash - do NFTs have a future?

The overblown hype surrounding crypto art and virtual assets may be over, but the basic idea is still relevant.

The promising NFT project has suffered a bitter setback after its massive bubble formed. Digital art on blockchain has now proven to be exactly what critics feared from the start: a bubble without substance.

Blockchain token prices have fallen by 90 percent. But the underlying concept remains priceless for investors. This was also the conclusion recently reached by stock market reporter Anne Schwedt in the Pioneer Investment Briefing .

Because the technology behind NFTs still offers countless possibilities. The idea of ​​selling and owning unique digital objects via blockchain has the potential to revolutionize many industries.

Artwork, music, virtual real estate – the applications are virtually endless. Even if the market may have temporarily become saturated and been brought back down to earth, NFT technology continues to demonstrate its innovative power and future viability.

Despite the recent setback, experts remain optimistic about the future of NFTs.”

While prices have collapsed, the underlying principles and use cases of blockchain-based token technology are becoming increasingly clear. Creative minds and companies continue to recognize the potential to create and trade unique digital assets via NFTs. 

Despite turbulent times, NFT technology remains firmly on the radar of investors and creatives alike.

Crypto, Bitcoin, NFT – what's behind these blockchain trends?

For those who haven't followed the crypto hype: Let's take a step back and explain the basic concepts and how these concepts work.

Cryptocurrencies like Bitcoin and digital assets based on them, such as NFTs, are now widespread terms, but are often misunderstood. They are all based on blockchain technology, a decentralized database consisting of various blocks of information.

These data blocks are linked together using cryptographic methods. Digital currencies based on this innovative technology have been on the market since 2009 and first reached a total value of over 2 trillion dollars in April 2021.

Bitcoin is undoubtedly the best-known and most widely used cryptocurrency.

Unlike traditional physical currencies such as paper money or coins, cryptocurrencies exist purely digitally and independently of institutions and governments. The fundamental idea behind cryptocurrencies is decentralized control , where everyone can participate in the creation and management of coins.

The value of cryptocurrencies like Bitcoin is increasingly being compared to that of gold, as both are viewed more as reserve assets than as direct currencies. Their value is based on their scarcity, since both gold mining and the number of Bitcoins are limited. Only 21 million Bitcoins can "mined" , which is considered the creation of new Bitcoins.

Simple Bitcoin transactions are recorded on the blockchain, which thus serves as a public financial transaction database. Bitcoins can be traded easily because their value remains stable. Unlike Bitcoin, other cryptocurrencies such as Ethereum, NEO, WAX, or TRON can also integrate "smart contracts"

One example of unique assets are NFTs (non-fungible tokens) . These digital assets, or crypto art, a digital collage by the artist Mike "Beeple" was auctioned at Christie's for $69 million.

NFTs can include drawings, digital artworks, video clips, GIFs, or even tweets, and can be traded.

Expert assessments from BTC-ECHO and NFT Floor Price

Despite the downward trend of the last two years, investors are still investing considerable sums of money in pixel art .

The most valuable Ethereum NFT collections

By far, Ethereum-based NFT art collections are the highest-valued form of crypto art. Even after the recent sharp decline, the top three alone still have a market capitalization of over $1 billion .

Looking at the charts on NFT Price Floor, one can discern something like a bottoming pattern in the price movements . This could make crypto art interesting again for investors in the medium to long term.

1st place: CryptoPunks

CryptoPunks are digital artworks in the form of NFTs, created by Larva Labs and presented in June 2017. These virtual objects comprise 10,000 copies existing on the Ethereum blockchain. As a pioneering pfp/Avatar project, CryptoPunks are part of the overall collection of Yuga Labs.

CryptoPunks' price floor is 21.80 ETH (approximately USD 56,000), with a 24-hour trading volume of 120.49 ETH and 5 sell orders. The project leads the ranking with an NFT price floor of 218,000 ETH (market capitalization: approximately USD 577 million) and a maximum supply of 10,000 units.

2nd place: Bored Ape Yacht Club

The Bored Ape Yacht Club was created by Yuga Labs and released in April 2021. It is an exclusive collection of 10,000 unique NFTs existing on the Ethereum blockchain. This pfp/avatar collection fits seamlessly into Yuga Labs' overall portfolio.

The current price floor of the Bored Ape Yacht Club is 9.83 ETH (approximately USD 25,000), with a 24-hour trading volume of 107.55 ETH and 11 sales. The project ranks second among NFT price floors, with a floor of 98.3 ETH (market capitalization: approximately USD 254 million) . There is a maximum supply of 10,000 units.

3rd place: Pudgy Penguins

The Pudgy Penguins are a unique series of NFT artworks created by The Igloo Company and unveiled in July 2021. Each of the 8,888 digital objects exists on the Ethereum blockchain. This pfp/avatar project enriches The Igloo Company's extensive collection.

The current price floor for Pudgy Penguins is 8.37 ETH (approximately USD 21,500), with a 24-hour trading volume of 115.63 ETH and 14 sales. The project currently ranks third among NFT price floors, with a floor of 74.4 ETH (market capitalization: approximately USD 192 million) . The maximum supply is 8,888 units.

The most valuable Bitcoin NFT collections

The Runes and Ordinals protocols enable the representation of non-fungible tokens (NFTs) on Bitcoin for the first time. The three most significant NFT collections on Bitcoin currently have a combined market capitalization of over US$180 million.

BTC-ECHO conducted a conversation with the creator of the NFT platform NFT Floor Price about the value of Bitcoin NFTs, the importance of Ethereum and upcoming NFT trends.

1st place: NodeMonkes

NodeMonkes collection , consisting of 10,000 unique NFTs, achieves prices of up to 0.13 BTC (approximately US$8,000) per unit. With a current market value of 1,340 BTC (US$80.1 million), NodeMonkes is the most prominent ordinal project on the market and is among the oldest of its kind, dating back to February 2023.

The data from NFT Price Floor underlines the importance and popularity of this NTF collection.

2nd place: Runestone

Runestone has a trading volume of 1.62 BTC, which is higher than NodeMonkes. Its market capitalization is 896 BTC, lower than that of the top-ranked NFT. Runestone's 112,384 BTC NFTs are impressively detailed: they are 3D models of black gemstones, which can be viewed on platforms like ord.io.

Minting these NFTs is expensive – the most expensive Runestone comprises 3.968 MB and the price for minting is 1.09 BTC (US$75,000).

3rd place: Quantum Cats

Quantum Cats is a digital artwork that was unveiled to the public on January 8, 2024. It consists of 3,333 unique elements that exist on the Bitcoin blockchain. This creation is categorized as a PFP/Avatar project and appeals to both art lovers and crypto enthusiasts.

Despite their low artistic value, the cats fetch substantial prices, with a current value of 0.26 BTC (approximately 15,800 USD) for the collection.

How does Nico Lallement of NFT Floor Price see the future of NFT art?

the cryptocurrency market is heavily dependent on market cycles, which are determined by macroeconomic and internal events within the market.

The NFT market is also affected by these cycles, according to Lallement.

Ethereum is currently receiving a lot of attention due to the approval of Ethereum ETFs in the US. Once this hype subsides, more capital is expected to flow back into Bitcoin projects, as the entrepreneur emphasized to BTC-ECHO.

The future of Bitcoin NFTs will likely be driven by the growing interest in high-quality collections, particularly generative art collections and AI art. Other uses, such as games and autonomous worlds, could also find a place on Bitcoin

"That's what Nico Lallement of NFT Floor Price told BTC-ECHO.".

What about Bitcoin, Ethereum & Co.?

Since most NFT collections are based on either Ethereum or Bitcoin, their performance naturally depends on the value of the cryptocurrencies themselves.

In the ever-changing world of crypto investments, mastering the latest and most sophisticated trading strategies is crucial. Unfortunately, many traders lack access to high-quality and reliable information in this field.

Investors are finding that providers like Immediate Code empower them to make informed decisions. These service providers aim to fill an information gap by offering introductions and further training in trading techniques. Simultaneously, they connect cryptocurrency traders with top-tier resources to enhance their market analysis skills.

After a sharp downward trend last week, cryptocurrency prices began to recover at the start of this week. Despite this recovery, Bitcoin is still significantly below its previous record high. Technical analysis also currently offers little cause for optimism and could even unsettle investors.

Overnight into Tuesday, cryptocurrency prices recovered after a sell-off on the exchanges. Bitcoin rose by 4 percent to $55,500, while Ether gained 6.3 percent and Solana even jumped 15.5 percent. Investors used the lower prices as an entry point, even though prices were still down for the week.

Today, the Bitcoin price reached its weekly high of $58,500, thanks to positive unemployment figures in the USA.

Impact of global political uncertainty

• The increasing political uncertainty, particularly in connection with the upcoming elections in the USA, is creating conditions for speculative investments in cryptocurrencies as “safe havens”.
• The sentiment in the cryptocurrency market traditionally reacts to political changes, making this sector particularly vulnerable to international news and political statements by influential figures.

These factors combined could further increase the Bitcoin price and underscore the connection between political events and cryptocurrency markets. The importance of careful analysis of political news should not be underestimated, as it plays a key role in shaping trends in the global financial market.

The influence of politics on cryptocurrencies

Political events in the United States have a long history of impacting financial markets, including cryptocurrencies. The link between political instability and fluctuations in the digital asset market becomes particularly evident at key moments in the political calendar. This can be illustrated in detail by considering the following aspects:

Immediate reaction to events

One example is the reaction to the assassination attempt on former President Donald Trump, which led to an immediate increase in activity in the cryptocurrency market.

The labor market figures, the earnings season of major corporations, and the rising tensions in the Middle East also have a direct impact on cryptocurrency prices.

Such events lead to increased volatility, as investors and traders try to predict possible changes in economic policy.

Long-term impact on market trends

Analysts point out that political events can have long-term effects on the crypto markets, especially in the run-up to elections.

Political uncertainty often leads to increased interest in cryptocurrencies as alternative investments, which can support or even increase their prices over longer periods.

The role of political uncertainty

• During times of political crises or major election campaigns, interest in cryptocurrencies increases as investors look for ways to hedge against risks.
• Uncertainty about political events and possible changes in legislation may encourage the active use of cryptocurrencies as "safe havens".

These aspects highlight the complex relationships between politics and economics, especially in the context of a globalized financial market where cryptocurrencies are playing an increasingly important role.

Predictions for the future of Bitcoin

Forecasts regarding the outcome of the upcoming elections, particularly a victory for Donald Trump, play a significant role in changing market dynamics. Many platforms indicated that the probability of a Trump victory had increased considerably after the assassination attempt.

Since Kamala Harris's nomination, however, the tide has turned again. A victory for the Democrat now seems increasingly likely.

The sudden rise in the Bitcoin price after the assassination attempt on Donald Trump, as well as its crash last Monday following bad economic news, underlines the sensitivity and volatility of the crypto market.

The prospects for a further rise in Bitcoin are positive. Nevertheless,  investments in cryptocurrencies remain risky.