As the boom in non-fungible tokens (NFTs) continues to gain momentum, a research report by Marketsandmarkets claims that the NFT market will grow by 35% per year to $13.6 billion by 2027. Currently, the market is estimated at $3 billion.
A report on the potential of the NFT market
A recent report by research firm Marketsandmarkets has highlighted the various factors that may contribute to the growth of the non-fungible token (NFT) market.
In the report, entitled “Non-Fungible Tokens Market by Offering, End-user, Region – Global forecast to 2027”, the research company states that the size of this market could increase significantly by 35% per year, and would be worth $13.6 billion in 2027 (compared to the current estimate of only $3 billion). This increase will only be effective if investor interest continues to grow in parallel of course.
The report highlights the main factors that will contribute to the growth of NFTs. The democratisation of the ecosystem is due to the increasing involvement of celebrities and influencers from all walks of life, the communities around video games and the ever-increasing demand for digital art.
But most notably, the MarketsandMarkets report considers other factors such as the many use cases in supply chain management, retail and fashion. Tech giants like Meta are also currently focusing on the metaverse, and this universe will rely in part on non-fungible tokens.
A new and fast growing market
This report is great news for investors as the NFT market is currently experiencing a downturn, as evidenced by the decline in Google searches for the term. It is a new market that will continue to grow but after growing by 21,350% in 2021, it seemed logical that this trend would decline from the beginning of 2022.
The main factors developed in the research report have allowed non-fungible tokens to achieve a high profile in recent years, and particularly in the last year with the increased adoption of NFTs by influential celebrities in different fields, and even sports teams or competitions.
For example, Elon Musk recently changed his Twitter profile picture to a collage of several popular NFTs from the Bored Apes Yacht Club (BAYC) collection. This simple temporary change of Musk’s profile picture resulted in an increase in the floor price of the NFT collection by 10 ethers (ETH). This shows how much influence celebrities have on the expansion of this market.
But with a new market comes new risks. Many countries have started to introduce laws for crypto-currencies and non-fungible tokens, however some bad people are taking advantage of the legal uncertainty and lack of consumer protection to run large-scale scams. Recently, a hacker stole NFT Bored Ape worth $3 million.
To avoid scams, many crypto sites well known to investors are starting to open their own NFT marketplaces. This is notably the case of the crypto exchange platform Coinbase, or Binance. These “marketplaces” allow investors to buy and sell NFTs in a secure manner. And all this should also contribute to the development of the NFT ecosystem.
In any case, if many celebrities join the non-fungible token movement, and their usefulness in the economy becomes relevant, there is no doubt that we will see a democratisation of this ecosystem which is still in its infancy.
