The once hypermarket for non-fungible tokens (NFTs) appears to be in the doldrums, with token valuations a fraction of 2021/22 highs, not to mention France’s premier event for the sector, NFT Paris was canceled just a month before the opening.
In the doldrums, but certainly not dead, said Yat Siu, co-founder of Animoca Brands, a Web3 development and venture capital firm that has become involved in tokenizing real-world assets.
Wealthy collectors provide a lively car NFT marketplace, Sui said in an interview at the CfC St. Moritz crypto conference. Some investors will have a connection to some type of digital art, just as a family office scion might be a collector of Picasso artwork, for example.
“Have NFTs remained popular among wealthy collectors? Yes, of course. I’m a big collector myself and I share similar insights with my peers in this field. It’s a community,” Sui said.
“For example, a Picasso collector would have an affinity with all the other people who collect Picassos; you kind of belong to that club. That also applies to Ferraris, Lamborghinis or Rolex watches. This is just a digital version.”
Sui says his own personally NFT portfolio is “down 80% or something,” but adds that these were never purchases he would reverse. “These are long assets that matter.”
NFTs are a class of unique tokens that first appeared on the Ethereum blockchain in late 2017 with collectible cats. Like other trends in crypto, NFTs have come in waves, become a thing with Cryptokitties, and then returned with more development and capital behind them, peaking in 2021/22 when monthly sales exceeded $1 billion.
Today, Sui points to monthly NFT a turnover of almost $300 million, driven mainly by wealthy digital art enthusiasts. For example, billionaire Adam Weitsman has bought NFTs such as Otherdeed lands — NFTs that represent land deeds in Otherside, a 3D blockchain-based virtual world created by Yuga Labs — and Bored Apes, very publicly, Sui said.
“Remember, five years ago this was a zero-dollar market,” Sui said. “So it’s all relative and depends on the perspective you take. And the great thing about this is of course that all data can be seen on the blockchain.”
Speaking of the flagship NFT Speaking at the Paris event, Sui said the cancellation is not an indictment of the NFTs, nor of the conference, which is well run.
“I think it’s an indictment of France, which at one point was very pro-crypto,” Sui said. “France has completely moved away from crypto. When it comes to NFTs, things like [fantasy soccer game] Sorare was closely monitored by gambling regulators. And we see the same anti-crypto attitude in Europe more broadly.”
Another major concern regarding Paris is security, Sui said. Over the past year, France has seen a wave of kidnapping and kidnapping attempts of crypto executives and investors.
“NFT Paris wasn’t just a victim because they couldn’t get sponsors. A lot of people, including myself, are trying to avoid Paris a little bit just because of security concerns,” Sui said.