Non-fungible tokens (NFTs) have gained widespread popularity since their inception in 2014 and have grown significantly over the years. NFTs have not only changed the perception of ownership and value in the digital world but have also paved the way for new forms of digital ownership, investment, and commodity.
The potential of NFTs is growing from not just a form of owning digital assets but also creating more inclusive spaces for cultural artifacts and many more in the coming future.
As technology is developing day by day, the potential of digitally encrypted assets will also grow. Investing in digital assets is a new trend and there are a few things to consider before investing. The article provides everything you need to know about NFTs and the predictions for their price in the upcoming years.
What are NFTs?
Non-fungible tokens (NFTs) are cryptographic assets based on blockchain technology with unique identification codes and metadata that distinguish them from each other. They are unique assets representing ownership of items like artwork, music, or real estate just like an ownership certificate, or a signature.
NFTs not only represent the ownership of digital assets, but physical assets as well. The tangible assets can be tokenized to make buying, selling, and trading efficient with lesser chances of fraud. These NFTs can be a representation of individual identities, property rights, and more.
NFTs differ from cryptocurrencies as Crypto is fungible, meaning NFTs are unique and cannot be exchanged one-to-one. It can be created by anyone and doesn’t need much computational knowledge.
Creating an NFT is called minting, like crypto mining, and the owner of the NFT has the private key stored in their digital wallet.
There are not many laws and enforcements that regulate the commercial trading of NFTs. NFT trading is often informal and the ownership exchange also doesn’t have any lawful enforcement and does not grant any copyright or intellectual property rights.
Uses of NFT
The uses of NFTs are growing daily but there are some of the most popular used NFTs.
Physical Assets: NFTs are used to show the ownership of physical assets like art, jewelry, or even costly wine. It is also used to represent ownership of real estate and other real-world assets.
Digital Assets: NFTs can be used to prove the authenticity of videos, photos, or audio files. They can also be utilized to collect online assets like weapons on online games or objects accessible for the avatar on Metaverse.
Credentials: NFTs are sometimes used for tickets to an event, or certifications after completing a course. They can be used for accreditation and specialization as well.
Negative Assets: Sometimes NFTs are used to represent loans, burdens, and other responsibilities usually said as negative value assets.
Example of NFTs
NFTs were initially used to collect digital art and later broadened the usage to many other fields. There are many popular examples of the uses of NFTs other than art, like the famous and most popular use of crypto kitties, which is a digital representation of cats with unique identification.
Each has a different price as well in the Ethereum blockchain. Cryptokitties were purchased spending millions just a few weeks after its launch in 2017. Photographers can create ownership of their works. For example, the popular NFT marketplace Opensea has a collection of photos owned by various artists that come under the same category.
Other examples of digital ownership using NFT are a collection of art based on sports, tokenizing trading cards, representing memberships, owning assets in virtual worlds, and owning a variety of art and music.
History of NFT
The first NFT was created in 2014 called Quantum by Kevin McCoy and Anil Dash. A video clip was registered on the Namecoin blockchain and sold for $4 and the creator referred to the technology as ‘monetized graphics.’
The first NFT project called Etheria was launched in 2015, three months after the launch of the Ethereum blockchain. The renewed interest in NFTs in 2021 caused a buying frenzy and all the tradable hexagonal tiles that cost 1 ETH were all sold for a total of US$ 1.4 million.
A semi-fungible NFT project called Rare Pepes emerged on Bitcoin through a protocol known as Counterparty, which contains a collection of art from various artists on Pepe the Frog meme.
By 2017 several NFT projects emerged on Ethereum that used a token standard known as ERC-20, like the first art-based NFT project on NFT named Curio Cards, CryptoPunks, Ethereum’s generative art NFTY project with 10,000 pixelated characters, and the clipart-based project called EtherRock featuring images of rocks. The popular CryptoKitties is credited with the first considered bonafide non-fungible token standard called ERC-721.
Non-Fungible Token Standard
The non-fungible token standard which is known as ERC-721 is recognized as pioneering the foundation of NFTs as well as opening the wider growth of NFTs. The term, non-fungible token (NFT) was formalized after the establishment of a standard for smart contracts known as ERC-721.
The tokens with ERC-721 have unique attributes that make each token different and have ownership details. The ERC-721 Non-fungible Token Standard is a technical framework in the Ethereum Blockchain network that proposes a set of rules and interfaces to create unique, non-fungible tokens. This standard sets the mark on NFTs’ usage in securing assets like digital artwork, real estate, game assets, and passes.
Choosing NFT marketplace
Choosing a marketplace for NFTs is based on user preferences like the user’s need to buy or sell NFTs. A wide variety of NFTs exist having various niches and reputations. There are a few types of NFT marketplaces like the non-curated, curated, mass, and niche NFT marketplaces. These can be general, open for anybody to sell, some are specialized, and others need invitations.
The following are some of the most popular NFT marketplaces based on their transparency, collection of various niches, and reasonable fees.
Rarible: An NFT marketplace with multiple categories that let users mint, buy, or sell tokens.
OpenSea: One of the most popular NFT marketplaces leading in sales which can be utilized by creators and collectors alike.
Crypto.com: Ethereum-based marketplace, Crypto.com doesn’t have any transaction fees and is compatible with smartphones.
KnowOrigin: An NFT marketplace with a service fee of 15% for primary sales and 2.5% for secondary sales, that focuses mainly on providing rare artworks.
Mintable: An NFT marketplace in categories like digital art, photography, videos, games, and domain names based on the Ethereum blockchain.
The NFT Market in general
The NFT market grew extensively tripling its value to $250 million US dollars during 2020. The first three months of 2021 witnessed $200 million US dollars spent on NFTs. As a result of high-profile sales and auctions, the interest in NFTs increased at the beginning of 2021. However, towards the end of the year, it was reported that the NFT market was collapsing, and the daily sales of tokens decreased by 92% from September 2021.
From November 2021 onwards, the number of active wallets in the NFT market also fell by 88%. The Wall Street Journal reported that as the interest rates increased, risks associated with financial markets also increased and NFTs were the most speculative.
After the introduction of Ordinals, a new way to add NFTs to the Bitcoin blockchain by the programmer Casey Rodarmor in 2022 December, the price and payment fees of Bitcoin increased. Some reports even claimed that the monetary value of most NFTs fell to Zero.
Even though the sales of NFT have dropped from the 2021 rate, there are new emerging implications in the growing digital world. A report in DappRadar suggests that late 2024 is the best quarter of the NFT market since early 2023. A 3.7% increase in NFT trading volume recording 4 billion dollars, and a 28% increase in NFT sales count, reaching 14.9 million dollars.
Most Expensive NFTs
The most expensive NFT ever sold is The Merge, reaching 91.8 million dollars in December 2021. The artist behind this NFT is Pak, a popular figure in the NFT industry for his art that challenges the logic of people. The Merge was a digital artwork that let the buyers purchase ‘masses’, and the Merge NFT will grow based on the number of masses purchased.
The NFT sale event was hosted by Nifty Gateway. The NFT event became the most innovative and record-breaking after witnessing 28,000 collectors. The sales reached the highest-ever sold rate of 91.8 million dollars.
Everydays: The First 5000 Days is the second highest sold NFT. It is a single NTF which is a digital collage of 5000 individual images created by the artist Mike Winkelmann, in the pen name Beeple. He created the art piece over more than 13 years by adding an image every day. The auction conducted in Christie’s witnessed the NFT sale of $69.3 million. The auction took place in March 2021, which is the time of the significant NFT sale and rise in overall value.
Other expensive NFTs ever sold are Clock, Human One, CryptoPunk #5822, CryptoPunk #7523, and TPunk #3442 with amounts of $52.7 million, $28.9 million, $23.7 million, and 11.75 million dollars respectively. CryptoPunks are NFTs created by Larva Labs, one of the most popular NFT collections in the world with only 10,000 unique characters.
Here is a table that shows the ten most expensive NFTs ever sold till 2024
| NFT name | Artist | Collection | Date sold | Price |
| The Merge | Pak | The Merge NFT | December 2021 | $91.8 million |
| Everydays: The First 5000 Days | Beeple | N/A | March 2021 | $69.3 million |
| Clock | Pak and Julian Assange | N/A | February 2022 | $52.7 million |
| Human One | Beeple | N/A | November 2021 | $28.9 million |
| CryptoPunk #5822 | Larva labs | Crypto Punks | February 2022 | $23.7 million |
| CryptoPunk #7523 | Larva labs | Crypto Punks | June 2021 | $11.75 million |
| TPunk #3442 | Mondiblo & Bastardber | Tpunks | August 2021 | $10.5 million |
| CryptoPunk #4156 | Larva labs | Crypto Punks | December 2021 | $10.26 million |
| CryptoPunk #3100 | Larva labs | Crypto Punks | March 2021 | $7.67 million |
| CryptoPunk #7804 | Larva labs | Crypto Punks | March 2021 | $7.6 million |
Price Prediction for NFTs
The price of NFTs is determined by machine learning techniques and is crucial for risk management as they are highly volatile. The value of NFTs is determined by their utility. As NFTs are not only used for artifacts, but for tickets, offers and membership programs, the value of it can vary. Predicting the prices of NFTs is crucial so that investors can adjust their portfolios based on the NFT market and avoid losses.
The price of NFT as of November 5, 2024, is $0.000000425835 and the trading volume is $37.52 million. The revenue in the NFT marketplace is predicted to reach 683.9 million US dollars by the end of the year 2024. The average revenue of the year per user in the NFT market is predicted to be 59 US dollars.
By 2025, it is estimated that the NFT marketplace will experience an annual growth rate of -11.01% which can lead to a total revenue of $608.6 million. The prices of NFTs in 2025 are predicted to be around $4.007000441318329e-8 to $0.00000119. By 2030, it is estimated that the NFT price can reach $8.53e-7.
The US NFT market is predicted to generate the highest revenue in the global market reaching $119,800.0K by the end of the year. Even though the NFT market has global popularity and significance, the US NFT market would still lead being the top because of its better digital infrastructure and strong investor interest. An increase in users is also expected for the coming year to reach 11.64 million.
The NFT price prediction for the year 2026 is somewhat positive. The prices may vary from $0.0000006201 to $0.00000188. There are some speculations that the price might reach $0.0000001431 in 2026. The potential ROI is 103%.
By the end of 2027, the NFT prices might reach $0.0000007676. This is an optimistic prediction whereas some other sites noted a decline in prices to hit $0000002168. The ROI is predicted to be 197% in the year.
Reaching toward 2030, predictions are hard to estimate based on market trends. Sites like TradingBeast forecasted the price to grow to $0.0000007979, whereas PricePrediction.net predicted the price to lower to $0.00000003036. WalletInvestor predicts the price to reach $0.000001181.
The prices predicted for the year 2040 towards the end of the year will range from $0.02491 to $0.04688 based on BitScreener.com. The price would range from $0.04374 to $0.4447 in the year 2050.
Conclusion
The NFT marketplace is booming considering the previous year’s growth. This growth is noted as the best after its initial popularity in 2021. Even though NFT is facing a few challenges the overall prediction of its prices is optimistic. According to forecasts, an increase in 8.15M% increase in NFT value bringing it up to $0.02848 is expected at the end of 2024 and will reach $0.03788 by 2025.
After NFTs broadened its categories to celebrity and athlete NFTs, which are the most popular in today’s trend, and NFT-based games and virtual real estate other than various kinds of unique artworks, a significant growth in prices is estimated to contribute to its growth. The predictions are only anticipations and the prices may go up or down in the coming years as NFTs evolve.