The Current Market Situation And What It Means For NFTs
With adoption soaring, increased mainstream media coverage, regulations easing and governments growing more and more fond of crypto, one would assume that the market is booming and basking in green charts. However, recent charts, figures and statistics sing a whole different tune, and it confuses the outside observer all the more.
The truth is that the crypto and NFT markets were never easy to understand to begin with, and given the countless factors that influence their behaviors, it becomes apparent as to why almost nobody can easily pinpoint what is going on — and more importantly — what is to come in the future.
What we can do, however, is observe some of the sentiments, attitudes and opinions surrounding the space, and produce a hypothesis — a general consensus — that could give us some kind of dim light in this darkness; some kind of an indication that is broad and vague enough to be safe, but specific enough for a rough direction to look forward to.
Latest Negative Sentiments Surrounding Crypto
Perhaps the main topic that keeps being brought up is energy usage, i.e, the vast amounts of energy required to run and secure the blockchain networks that power the protocols we all know and love. With climate change becoming a growing concern, more and more governments, institutions, parties and groups are looking for greener solutions to make the planet a cleaner place.
Another thing that has been dissuading people from crypto is the increasing number of scams and hacks that are taking place as of late. When mainstream news covers and sensationalizes these events, it’s no wonder why people fear the crypto space. Fortunately, hacks are rare occurrences and victims tend to be reimbursed, as was the case with Crypto.com; and on the other hand, scams are easy to spot due to their fundamentally flawed nature, and thus, are easy to ignore.
Lastly, there is no denying that the stock market has a strong influence on its cryptocurrency counterpart, and the 2 tend to mimic each other’s movements from time to time. This may be the case of what is going on this week, and if so, may require some time to recover.
Latest Positive Sentiments Surrounding Crypto
On the note of energy usage, there are a lot of misconceptions when it comes to cryptocurrencies and the amount of energy they require to run, especially when it comes to NFTs. The biggest consumer of energy in the blockchain space is Bitcoin, but the Bitcoin network is seldom used for NFTs — if at all. Ethereum on the other hand, while it currently utilizes a PoW consensus mechanism, is set to switch to PoS, which is an eco-friendly alternative. Other blockchains that support NFTs are already utilizing Proof-of-Stake, meaning they don’t pose a threat to the environment. Unfortunately, the average person is not fully aware of these intricacies, and assumes all blockchains, crypto and NFTs consume way too much power.
For a while, people feared the harsh regulatory possibilities coming from big governments from around the world, but if recent events have told us anything, that doesn’t seem to be the case anymore. From the US to Russia, it seems neither country has an interest in banning the usage of cryptocurrencies, blockchain and NFTs, which is all the more reason to celebrate and see a future for the technology.
Despite the notable dip, El Salvador president Nayib Bukele announced the purchase of a further 410 Bitcoins, worth around $15,000,000. The commitment, persistence and consistency of the small yet innovative country only goes to show how much they believe in the technology they are not only investing money in, but an entire economy and future.
What Does This Mean For NFTs?
The beauty of NFTs is that while they tend to be traded freely like regular cryptocurrencies, they are separate due to their nature. A user who owns an NFT of artwork still owns the same artwork, and market conditions don’t change that fact. If you own a music NFT you bought from the Mozik marketplace, you still own the same album, and you can listen to all its content with indifference.
NFTs, while can be traded, are meant to also be utilized, and that is where most of their value comes from. Even if the prices of cryptocurrencies take a fall due to a bear market, a user can price their NFTs according to fiat, and as such earn the same amount in the fiat currency, but even more so in the select cryptocurrency. You may see the NFT volume or market cap drop, but the technology is still there, and no market conditions can take that away.
Mozik is a decentralized music NFT platform aiming to build a healthier and fairer music ecosystem. Through the decentralized NFT platform, Mozik adopts blockchain technology to register earnings through music copyright, super-star IP, and IP derivatives on-chain. All the participants in the music ecosystem, including creators, publishers, customers, and fans can fairly participate. Through Mozik’s platform, artists will be incentivized to create more and better quality music. With lowered publishing costs and higher engagement from music fans, all participants can share in the rewards, and create a healthier and fairer music ecosystem.