How your New Year’s hangover will prove NFTs are an absolute powerhouse about to explode.
As we entered a new year with East Coast US timezones, here in Australia, we were already nursing the hangovers our US and European NFT frens were about to have. While our throbbing heads had seen ecstatic joy roll over to regretful pain, we took solace from something else that rolled over — that showcased the power to transform; the power to expose and the power to drive change. I say we, as there are only several hundred thousand of us globally who may have taken such pleasurable solace — 362,679 to be precise as of midnight (EST) 31st December 2021. This is the number of active traders, who had traded at least one NFT on Open Sea the world’s largest NFT marketplace (c 92% of the NFT marketplace).
“Big deal” you might say, in between reaching for the latest hangover cure spruked by your latest social media influencer and retching into the great white telephone possibly lacing with the vegetables you have no recollection of eating.
“That’s…” after careful, challenged deliberation “…not a lot”
(it’s around 0.005% of the global population of 7.753bn in case you are still suffering from the legacy of a lingering hangover).
In one way you’re right — but as the misty fog of formaldehydes in your frontal lobes fade away it hits you — how can you be so precise? At an exact time? In real-time?
Then you have your “Archimedes-in-the-bath” moment. You get your sponges ready to soak up the explosive ocean of ideas floating on the bathroom floor. You then reflect on all the markets that are cloaked in secrecy, that are not as open as we are led to believe. Instead, we live vicariously, often cheering, as the regulators that pass down fines the equivalent of the GDP of a less developed country for the clear distortion of markets that have all to often been seen. So why is this such a big deal?
NFTs on OpenSea are based on the public Ethereum blockchain. Without getting knee-deep in the technical weeds, blockchains provide permanent, transparent data for all to see in real time. The data cannot be destroyed, it can only updated — with the original data permanently held and available for all to view and to audit. To showcase the openness of this marketplace consider further the data as at 31st December 2021 as showcased by Dune Analytics
Dune analytics crowdsources the data analytics, where super-smart data analysts algorithmically question the publicly available blockchain data. One particular data analyst (shoutout to @RichardChen8) questions the opensea blockchain in real time and provided the following information as at 31st December 2021:
- 2nd highest monthly sales (December 2021) ever on Open Sea — $3.25bn
- Highest daily volume for 3 months on Open Sea — $161m
- The highest number of active traders ever on Open Sea — 362,679
Collectively these data points provide the insights and immutable data to provide a transparent microscope for analysts to understand what is going on in the NFT marketplace in real-time.
Consider how this real-time data can be used:
- Artists can plan production schedule and marketing strategies in real-time
- Investors can assess in real-time the optimal time to deploy capital — if the market is trending back to earlier levels of buoyancy
In the last 3 months the NFT marketplace conditions have been weak — but the data is showing in real-time the changing trends that are evolving helping to make real-time decisions to be made. But imagine a future where:
- This was data from the precious metals market — where (according to Bloomberg) more than $920m of fines were handed down to JP Morgan to resolve US authorities’ claims of market manipulation
- This was economic data from an economy… where Central banks and governments can adjust monetary and fiscal policy in real time
- this was data from the sales of Indigenous art globally where ownership could be identified and fair and equitable royalties automatically attributed and distributed to the original creators of the art, often living from day to day (the core thesis our project Walking Between Worlds)
So, as you enjoy the entrée into 2022 just realise we are at the very cusp of a massive tsunami of transformation — not only from the point of view of artists but also for markets, economies and governments as whole.
NFTs are the minimum viable product (MVP) that will prove the power of the technology:
- to expose corruption;
- to provide insights to manage companies & economies and
- to empower those that have been disenfranchised .
So, Happy New Year to all as you dust yourself down after the great New Year celebrations, let the hangover takes its natural course and watch the growth and power of NFTs take hold as they provide the catalyst to clarity and truth we have all been waiting for — for far too long.
About the author
Tim Lea (@timothylea2 on twitter) is author of the book Down the RabbitHole, a book on the blockchain in plain English, an international keynote speaker on the strategic application of the blockchain, and an investor in NTFs and the cryptocurrency space. He is the co-founder of a new Social Impact project Walking Between Worlds (@WBWNFTS on twitter) whose mission is to energise global Indigenous communities to amplify First Nations powerful voices through NFTs