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Are NFT markets in a death spiral or ready for a resurgence?

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Nonfungible tokens (NFTs) saw a massive surge in popularity in 2021, accompanied by sky-high prices, but the market has since come crashing back to earth, and it’s unclear whether there will be a resurgence. 

NFTs are unique digital tokens recorded on a blockchain to certify ownership and authenticity. They can’t be copied or substituted but can be transferred and sold by their owner.

According to analytics platform NFTGo, the NFT market cap valued in Ether (ETH) is down 40.59% over the past year at the time of writing, with trading volume down 40.81%.

The market cap in U.S. dollars is down 41.16%, and its volume has dropped 66.77%. At the same time, market sentiment is ranked 13 out of 100, with an overall rating of “cold.”

The NFT market has fallen even further in the latter half of 2023. Source: NFTGo

Arno Bauer, senior solution architect at BNB Chain, told Cointelegraph that from a utility perspective, NFT projects are increasingly adding value and that this growth in functionality is where the future of NFTs likely lies. 

Bauer said the NFT market is showing “promising signs of innovation and creativity,” which holds great potential for the growth and evolution of the tech.

Related: Crypto lawyer about SEC: ‘Problematic to imply all NFTs are securities’

“Market sentiment, cultural shifts towards digital ownership, and the potential for NFTs to be integrated into various aspects of our lives also contribute to a positive outlook for the future of NFTs,” he said.

“While current market conditions might seem subdued, the ongoing innovation and potential for integration with both digital and physical worlds suggest that NFTs have not had their day and that their continued relevance and growth are highly probable,” Bauer added.

NFTs in the long term

As for long-term use cases, Bauer said NFTs will “likely evolve” over time and become increasingly linked to real-world assets, such as property ownership or unique physical goods.

Currently, NFTs have been most successful in the art world, with some selling for tens of millions of dollars.

Digital artist Pak sold an NFT project titled “The Merge” for $91.8 million on Nifty Gateway in 2021, while Mike Winkelmann, also known as Beeple, sold “Everydays: The First 5000 Days” for $69.3 million via Christie’s auction house the same year. 

Blockchain games also use NFTs to represent in-game items such as weapons and armor, and there is speculation the tech will make the jump to mainstream games. Various types of music assets are also being sold as one-of-a-kind NFTs.

Bauer thinks that as more robust technology provides enhanced use cases and ownership security, NFTs will likely become more attractive to mainstream markets.

He speculated that NFTs could link to financial instruments, representing shares in companies or investment funds, and social achievements, where they could symbolize badges of accomplishment in various fields.

“Beyond art, the ability to tokenize unique assets and provide verifiable ownership will create numerous applications across various domains,” Bauer said.

“Collaborations with traditional industries, technological advancements, clear regulatory frameworks and educational efforts can significantly boost NFT utility and adoption.”

“Addressing sustainability concerns could make them more appealing to a broader audience,” he added.

NFTs have the potential to make a comeback 

Jason Bailey, co-founder and CEO of NFT tool and self-custody solution ClubNFT, told Cointelegraph he thinks “NFTs will come back and go mainstream” because crypto and NFTs rebound cyclically, just like previous tech crashes. 

According to data gathering platform Statista, the NFT market is projected to continue growing in revenue, users and market capitalization.

As of 2023, there are 13.95 million NFT users, but that’s expected to hit 19.31 million users by 2027.

However, Bailey believes NFTs currently have some issues, most of which were amplified by rampant market speculation, that need to be solved before NFTs can go mainstream. 

He said NFTs and the ecosystem around them are so complex that almost everyone is still vulnerable to many risks they may not even know about.

“Many of us have been trying to educate and onboard people into the space thoughtfully so they can be safe, but the truth is that NFTs won’t go mainstream until the complexity is replaced with a safe-by-default easy path,” Bailey said.

“For example, the vast majority of people don’t realize that an NFT is almost always at risk in a sense, except for fully on-chain NFTs, which are a truly tiny fraction.”

“The steps needed to protect the art from disappearing, and prevent the NFT from breaking, are complicated, time-consuming and error-prone,” he added.

Related: AI-based tools bring security and transparency to the NFT market

Bailey believes that in the long term, NFTs or similar tech could prove invaluable in validating digital documents such as marriage certificates, diplomas and licenses.

Overall, he thinks NFTs solve too many of the current problems associated with digital ownership — including scarcity, authentication, provenance and provable ownership — to be ignored.

“We need to build infrastructure now, during the bear market, for smoother onboarding and to protect NFT adopters from malicious actors in the next NFT bull market,” he said.

“Once these issues are solved, NFTs will absolutely go mainstream because the train of digital ownership left the station decades ago, and there is no stopping it.”

Meaningful projects could be a game changer for NFTs 

Speaking to Cointelegraph, Andy Ku, founder and CEO of digital content Web3 ecosystem Altava Group, said he thinks the previous highs in the NFT market were based on a hype cycle, so it’ll be hard for an individual NFT to reach such lofty heights again.

According to CoinGecko, many of the top NFT collections have seen significant drops in value over the past year. 

At the time of writing, Bored Ape Yacht Club has fallen by 67.1%, CryptoPunks by 33.2%, Mutant Ape Yacht Club by 59.2% and Azuki by 49.3%.

Ku believes that if we can see more meaningful NFT projects on the market offering tangible benefits to more people, then it’s possible to have the combined volume bring the overall market value up.

Related: What’s next for NFTs and Web3 in the age of the creator economy?

“NFTs should offer value and utility beyond just a digital art or PFP. The two areas I particularly believe in are asset-backed NFTs and a membership NFT,” he said.

“NFT’s core value of being an immutable representation of something is a great fit for assets and membership.”

NFTs for subscription, membership-based models and loyalty programs are starting to gain traction, with examples in hospitality venues and gyms already on the market.

“In terms of asset-backed NFTs, master artworks, real estate and precious metals like gold are all good examples of assets in which people believe,” Ku said.

“NFTs would make a great proof-of-ownership for these assets as well as being extremely portable,” he added.

Cryptocurrency

Hipposol, A Solana-based Memecoin Announces $Hippos Token Presale Round

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[PRESS RELEASE – London, United Kingdom, April 24th, 2024]

Today marks a monumental day as Hipposol, A solana memecoin proudly announces the launch of $hippos pre sale round for early participants. Drawing vibrant inspiration from the mighty and playful hippopotamus, the $Hippos token presale event begins today April 24th 2024, with a sale duration of 26 days.

Hipposol Ready To Pioneer A New Era in Memecoin

$Hippos isn’t merely another entry in the memecoin ledger; it heralds a new era where community, technology, and sheer fun merge to forge genuine value. “With $Hippos, we’re not just redefining memecoins; we’re revolutionizing how a memecoin community and digital currency coexist. This journey isn’t about speculative trading alone; it’s about crafting a community empowered to steer its course and reap substantial growth,” said King Hippo, the revered leader of the Hipposol herd.

The Hipposol team believes the $Hippos pre sale event means more than buying a token; it means joining a memecoin herd that leads. With Hipposol community-driven development approach, users insights and votes directly influenced by the $Hippos holders, Hipposol is set to be next meme sensation on Solana.

$Hippos Presale Facts:

  • Token Presale Rate: 1 SOL = 150,000 $Hippos
  • Minimum Buy: Dive in with as little as 0.5 SOL

Users can join the Solana meme adventure with Hipposol and experience a new breed of memecoin that’s ready to make waves.

For more updates and news on Hipposol memecoin;

Website | $Hippos Sale portal | Twitter | Telegram 

Hipposol is the source of this content. This Press Release is for informational purposes only. The information does not constitute investment advice or an offer to invest. Investing in cryptocurrencies can be volatile and dangerous.

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Tether Will Freeze Venezuelan Wallets Being Used to Evade US Sanctions

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Tether has announced that all wallets associated with Venezuela’s attempts to bypass U.S. sanctions on oil exports will be frozen.

The decision follows recent reports indicating an increased use of Tether’s USDT by Venezuela’s state-run oil company, PDVSA, to avoid sanctions imposed by the United States.

Venezuela’s PDVSA Turns to Tether Amid Sanctions

According to a Reuters report, Venezuela’s state-run oil company, PDVSA, transitioned to using Tether’s USDT after facing renewed sanctions on its oil exports.

Tether took a similar stance in December last year, freezing 161 wallets in compliance with U.S. sanctions.

A spokesperson for the stablecoin issuer emphasized the company’s commitment to upholding sanctions by stating, “Tether respects the OFAC SDN list and is committed to working to ensure sanction addresses are frozen properly.”

PDVSA’s increased use of cryptocurrency payments is part of a broader strategy to mitigate the repercussions of U.S. sanctions re-imposed due to Venezuela’s failure to implement electoral reforms.

By using cryptocurrencies like USDT, PDVSA can conduct transactions while minimizing the risk of assets being seized by U.S. authorities. Reuters notes that PDVSA uses intermediaries to hide the trail and evade tracking in USDT transactions.

However, a recent PDVSA scandal has complicated matters, as investigations uncovered around $21 billion in unexplained receivables from oil exports. This scandal is partly linked to prior transactions involving other cryptocurrencies, adding complexity to the situation.

USDT Prepayment for Oil Deals

In 2024, PDVSA restructured its spot oil deals to require prepayment for half of each cargo’s value in USDT. This requires new customers interested in buying Venezuelan oil to possess a digital wallet capable of conducting cryptocurrency transactions.

Furthermore, the U.S. government has conditionally permitted the resumption of business with PDVSA. This decision came in October when Washington issued a six-month license, allowing trading houses and former PDVSA customers to resume business with Venezuela. However, due to digital transaction requirements, many of these entities had to rely on intermediaries to facilitate the transactions.

Venezuela’s venture into cryptocurrencies dates back to 2018, when it introduced the “petro” token to mitigate the economic turbulence induced by U.S. sanctions. However, the petro’s poor adoption led to its shelving earlier this year.

Meanwhile, OFAC has recently intensified its scrutiny of the cryptocurrency industry. In December, OFAC imposed fines on crypto exchange CoinList amounting to $1.2 million for facilitating Russian users in evading sanctions. Before this, the agency sanctioned a crypto mixer allegedly used by hackers in North Korea.

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Here are the Top 5 Gainers in the Bitcoin (BTC) Ecosystem YTD: Details

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TL;DR

  • Core (CORE) has significantly outperformed Bitcoin and many other major cryptocurrencies with a 350% price surge this year.
  • Other digital assets related to BTC’s ecosystem, such as Sovryn (SOV) and Ordiswap (ORDS), also reported notable gains, with increases of 210% and 100%, respectively.

CORE Leads the Pack

Bitcoin (BTC) has been making serious waves since the beginning of the year, with its price rising from approximately $42,000 on January 1 to almost $67,000 on April 24 (a 60% increase). However, some cryptocurrencies related to its ecosystem have witnessed even more substantial gains over the same period, and Core (CORE) is the perfect example.

It is a new blockchain that leverages the advantages of Bitcoin’s Proof-of-Work network and the delegated Proof-of-Stake consensus mechanism to offer more security, scalability, and decentralization. 

Its native token, CORE, is currently worth around $2.51 (per CoinGecko’s data), a 350% surge compared to the $0.55 observed at the start of 2024.

CORE Price
CORE Price, Source: CoinGecko

The asset’s price was even higher at the beginning of April, briefly surpassing the $4 mark, while its market capitalization crossed the $3.5 billion milestone before settling at its current level of around $2.2 billion.

Sovryn (SOV) Comes Next

The protocol, running on a Bitcoin sidechain called Rootstock Smart Contract (RSK), has also witnessed a significant resurgence in the past several months. 

Its native token – SOV – has been up 210% since New Year’s Eve, currently trading at approximately $2.10. However, its price performance is far from its glory days in 2021, when a single coin was worth over $35.

SOV Price
SOV Price, Source: CoinGecko

Ordiswap (ORDS)

Ordiswap is the first Automated Market Maker (AMM) designed for the BTC blockchain. Its main purpose is to provide liquidity provision and decentralized trading directly to Bitcoin’s native layer.

The governance cryptocurrency of the AMM—ORDS—was launched at the end of December last year and has jumped by 100% since then. Last month, it soared to an all-time high of $0.26 before retracing to its current mark of $0.10.

ORDS Price
ORDS Price, Source: CoinGecko

LeverFi (LEVER)

This is a decentralized leverage trading platform with a native token called LEVER. The latter ascended by 98% since January 1, 2024. It is also among the notable gainers today (April 24), registering a 10% increase on a daily scale.

LEVER Price
LEVER Price, Source: CoinGecko

LEVER’s market capitalization recently jumped above $120 million for the first time while currently hovering around $100 million.

Bitcoin Cash (BCH)

The popular hard-fork blockchain, split from Bitcoin in 2018, finds a place in the list, too. Earlier in April, it completed its second halving, with its price ascending substantially in the months prior to the event. Two weeks ago, BCH hit a multi-year high of more than $700, but it has been on a downtrend as of late. 

Currently, a single token is worth around $500, which is still a 93% increase compared to the figure observed at the beginning of the year.

BCH Price
BCH Price, Source: CoinGecko

 

 

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