New reports have been released pointing to a major slowdown in NFT trading. Still, developers continue to deploy millions of smart contracts across EVM-enabled chains, indicating interest in finding broader use cases for blockchain tokens.
Meanwhile, Etihad Airways announced plans to launch a Web3 loyalty program that will allow the frequent flyer community to deploy NFTs for miles. In addition, the team behind the Ordinals protocol is launching a non-profit organization to keep its development “clean” of corporate influence.
This week’s alpha
Non-Fungible Trading Issues: It’s been a bad, very bad month for NFT trading, according to two new reports.
NFT trading volume is down: According to a new report from Web3 developer platform Alchemy, NFT trading volume fell 41% in the second quarter of 2023. Blake Tandowsky, growth analyst at Alchemy, told CoinDesk that whale NFT trading volumes fell in the second quarter of 2023. peaked in the quarter of 2022. but as time went on newcomers started to dwindle. He suggested that NFTs should come up with new use cases beyond their native JPEG iteration.
NFT sales have slowed: Another report from analytics firm DappRadar that sales of NFTs fell by almost half between January and July. In addition, rock-bottom prices of blue chip collections such as Bored Ape Yacht Club and Azuki fell to two-year lows, indicating declining interest among merchants to pay top dollar for the collections.
Silver linings? Polygon NFTs are still crushing and dominated a fair share of all transactions in July. Meanwhile, unperturbed by the dismal numbers, Web3 developers continue to deploy millions of smart contracts across EVM-enabled chains, indicating continued interest in decentralized apps and broader Web3 use cases.
The stakes are high: Etihad Airways, which has been steadily releasing NFTs through its EY-ZERO1 collection, has announced plans to launch a new Web3 loyalty program called “Horizon Club”. NFT holders already have access to a number of benefits, including Etihad Guest Silver Tier Status, priority check-in and lounge access. But starting in September, the EY-ZERO1 loyalty program will allow collectors to use their NFTs for miles that can be redeemed for flights, upgrades and other benefits.
Web3 loyalty programs are booming: Many major brands, including Starbucks, have recently introduced loyalty programs incorporating blockchain technology and NFT rewards. The airline industry has been slower to adopt these programs, although a number of airlines have begun to embrace NFT ticketing and metaverse travel experiences.
Funding for Ordinals: Ordinals, the protocol that allows NFTs to be added to the Bitcoin blockchain, is establishing a non-profit organization to ensure that its developers are compensated for their work in a way that does not compromise their neutrality. Bitcoin mainnet inscriptions were first introduced by programmer Casey Rodarmor in January and paved the way for Bitcoin NFTs, although development of the technology was largely privately funded by Rodarmor and gifted contributions to the core developers.
Keeping Ordinals Free from Corporate Influence: The Open Ordinals Institute, a registered 501(c)(3), will collect donations in bitcoin and share protocol development progress. “Given the unprecedented pace of adoption of Ordinals and the real-world implications for various crypto economies, we believe it is critical to fund a strong team of non-company-funded developers to ensure the security and neutrality of this open-source protocol. ,” said Erin Redwin, board member of the Open Ordinals Institute.
NFTs as a Growth Area: Redwin said the nonprofit is interested in growing the newly discovered utility of Bitcoin-based NFTs. “Companies in Web3 ecosystems – including Ethereum, Solana, Stacks and others – are rapidly building Ordinals infrastructure after previously believing that NFT functionality was ‘not possible’ on native Bitcoin,” he said.
Project in the spotlight
cryptopunksWho: CryptoPunks by Larva Labs (now owned by Yuga Labs)What: CryptoPunks, one of the first NFT projects on Ethereum and also one of the most popular collections of all time, experienced a number of high-profile transactions this week, including one from prolific NFT artist Beeple. His first profile picture (PFP) NFT purchase, the clownish Punk #4953, set the stage for other high-value purchases, including Punks #6634, which sold for 235 ETH (approximately $432,000) and Punk #3307, which sold for 500 ETH (about $915,000).How: While the wider NFT market is down and it’s rarer for large cash transactions to happen as often as they used to, the latest CryptoPunks pump is a positive sign that an NFT renaissance may be in our future. Plus, it boosts morale to see well-known figures like Beeple get involved with certain NFT communities — he even announced plans to host a Punks rally at his Charleston studio in September.
In other news
Gucci has the goods: Holders of the 2,896 Gucci Vault Material NFTs, released by the luxury house in March, will soon be able to exchange their NFTs for a wallet or purse.Start Time: Web3 Golf Community LinksDAO has launched a number of new membership options at the refurbishment of Scotland’s newly acquired Spey Bay Golf Course.King of the jungle: Bored Ape, parent company Yuga Labs, will acquire metaverse-focused Roar Studios to flesh out its vision for Otherside.NFT Now – or never: NFT publication NFT Now has laid off staff in response to “over-hiring”.Grand Prix NFT: Crypto exchange Kraken is crowdsourcing NFTs that it plans to put on the back of a British F1 race car at the US Grand Prix in October.Are celeb ads back?: Comedian and actor Adam DeVine is the face of Bitget’s weird new campaign that evokes other ill-fated celebrity ads like Matt Damon.
Non-fungible toolkit
What does it mean to tokenize real world assets?
Imagine you want to buy an Andy Warhol artwork. Most of us can’t afford to shell out record prices like $195 million for a Marilyn painting or even $850,000 for a simple print of Queen Elizabeth. Many people want to buy art for pleasure or as an investment, but are priced too high. But what if you could buy “shares” of a work of art the way you can buy fractions of a public company? That is the idea behind the tokenization of real world assets.
Here’s what you need to know.