Even before FTX collapsed, Non-Fungible Token (NFT) The collection is already feeling the influence of crypto winter 98% reduction in trading volumeThe FTX debacle seems to have hit the once burgeoning space with the final nail.
With a huge amount of user funds stuck on the FTX exchange amid the liquidity crisis, users tried to withdraw their funds in a roundabout way. One of the questionable ways to withdraw your balance is Purchasing Bahamas-based NFTsMany community members criticized the method for circumventing bankruptcy law. ridicule In the process, the NFT utility appeared, and a negative image of NFT was drawn.
But Oscar Franklin Tan, an executive at NFT platform Enjin, doesn’t think that’s a fair summary. Speaking to Cointelegraph, Tan said NFTs were used, but other items could have been used as well. “This had nothing to do with his NFT technology, it had to do with loopholes for users in the Bahamas,” he noted.
Executives are also positive about the survival of the NFT space despite the impact of FTX and the bear market. Tan emphasized the need to refocus on how NFTs are demonstrating acceptance of digital ownership, new models for content creators, and funding for content creation. I explained as follows.
“Yes, there has been a lot of hype and overenthusiasm for some models, but this is true of all new technology. There will be second-generation NFT models that are smarter and more sustainable.”
Tan emphasized that for NFT projects to recover, they need to focus more on building utilities and communities. Avoiding short-term speculation and unrealistic roadmaps is a must. Rather, they should have long-term sustainable value.
Various players within the NFT space expressed similar opinions. Jamie Thomson, CEO of NFT game studio Vulcan Forged, has commented that his proven market-useful NFTs are bound to survive. Thomson told Cointelegraph that he cannot say the same about NFTs based on speculation and bragging rights. But executives said these types of NFTs will “suffer more for frugal hands” as users wait for a better market.
“There is less speculation and more mandatory utility. If the NFT is integral to the functioning of the project or the existence of its users, as is the case with tokens, there is less concern over price divergence. access to functionality, access to added value.”
Meanwhile, NFT artist Jonathan Schultz believes the era of impractical NFTs is coming to an end. “That’s why there are more projects with more use cases and utilities,” he said. Schultz told Cointelegraph that for space to survive, it must grow beyond what he describes as the “memizing” of things. This means building important projects that affect the entire space.
With FTX’s NFT marketplace in the midst of a company implosion, Nick Rose Ntertsas, founder of NFT platform Ethernity, has a suggestion for a better way. Ntertsas told Cointelegraph that FTX’s centralized exchange-based model for his NFT platform has been shut down. he explained:
“That model should have been democratized and transparent. I am passionate about what I do.”
Contrary to others, Ntertsas believes that NFT projects should not have a single focus, as different projects have different objectives. But executives would like to see more projects challenging the space to “reimagine what’s possible with NFTs.”