From the Mintable blog.
As we move into 2023, the NFT market continues to gain popularity and attract a lot of people looking to buy, sell, and trade digital assets. In the crypto world, NFTs have already generated millions of dollars in sales, and the future looks even more promising as the technology and user experience continue to improve.
DappRadar shared with Decrypt that nearly $24.7 billion of NFT trading volume was traded across different marketplaces and platforms in 2022. Nansen’s Trends & Indexes dashboard shows that the Ethereum NFT sphere alone saw 8.22 million ETH in trading volume across 2.46 million unique wallets.
NFTs have created a new way of trading digital assets, allowing for actual ownership and provenance of digital art, collectibles, and other digital assets. As the NFT market continues to evolve, it will bring new possibilities and change how we interact with digital content.
Web 3 Trends, Utility, and Use Cases
NFT collectibles remained central in growth and demand in 2022
As of Sep 2022, Nansen indicated that collectibles were the central driver of growth and demand for NFTs in 2022. NFTs have made significant inroads into various sectors, beginning with art and music but quickly branching out to include film, sports, fashion, gaming, virtual worlds, ticket sales, supply chain management, and high-end products.
Brand Identity: Polygon ‘Funnels’ Big Brand Partnerships
We see more businesses follow in the footsteps of early adopters like Reddit and Nike, who have seen great success in brand awareness and revenue generation through integrating digital collectibles (NFTs) into their offerings.
Polygon Studios, a platform with around 198 million separate wallet addresses that facilitates purchasing, selling, and collecting non-fungible tokens (NFTs), recently teamed up with Starbucks to unveil its Odyssey loyalty program based on NFTs.
Polygon scored the product market fit and onboarding process for established brands
According to Forrest, such partnerships provide tremendous value to the Layer-2 Protocol through network participation, brand awareness, and trust. Simply put, they have scored the right product-market fit and simplified the onboarding process for businesses to integrate Polygon into their products.
Given this, we will likely see a trend of well-known brands jumping aboard and offering similar opportunities to their customers. This trend will bring millions of new consumers to the world of web3 and significantly increase brand awareness and engagement for businesses that embrace this new blockchain technology.
Debating The (Mid)Journey of Artificial Intelligence (AI) Generated Art
NFT art and digital art are becoming more prevalent as digital artists use AI technology to create generative art projects and one-of-a-kind digital assets.
OpenAI’s GPT-3 based tools like DALL-E 2 and Generative Adversarial Networks like pix2pix have opened up new possibilities for creative expression and experimentation. While some artists may see it as a form of creative dishonesty and lack of originality, others argue AI democratizes the art-making process.
One fine example of AI NFT art is ‘Botto’. In 2021, An AI algorithm called ‘Botto‘ sold its first collection of 6 NFTs for $1.3 million through SuperRare.
We predict that AI-generated art in the NFT space will expand one-of-a-kind artworks to the gaming and virtual reality space in 2023. On top of this, more collaborations will emerge between artists, programmers, and AI developers, in a wide range of advertising, music, and fashion industries.
Moving the pieces around the GameFi industry
The GameFi industry is expected to reach a valuation of $2.8 billion within six years.
GameFi has also seen a significant increase in the use of NFTs, as they are used to represent in-game assets such as weapons, armor, and even virtual real estate. Players now gain ownership and control over their in-game assets, creating new monetization opportunities for game developers.
Based on Nansen’s Statistics in 2022, throughout much of the NFT boom, play-to-earn games featuring NFTs led. Aleksander Larsen, the co-founder of Sky Mavis, the team behind the popular P2E game Axie Infinity, told Cointelegraph that it’s just a matter of time until more big players enter the space.
According to Zoe Wei, the senior business director at BNB Chain, further experimentation and analysis are necessary to make the token economies of most games sustainable. Despite this, Wei still thinks that both Play-to-earn (P2E) and Move-to-Earn (M2E) concepts will be relevant in 2023, though there needs to be more improvement.
Expanding on Digital Ownership, Intellectual Property, and Real Estate
NFTs can represent tangible and intellectual property ownership and provide access to exclusive digital experiences, making them a valuable tool for creating new fungible tokens. Digital experiences and ownerships open a new world of possibilities for using NFTs in gaming, virtual worlds, the metaverse, and other digital platforms.
Digital ownership and Intellectual Property (IP)
With the increasing replication of digital assets, it is not easy to prove ownership or authorship of an NFT. This challenge has led to concerns about plagiarism, copyright infringement, and other forms of intellectual property theft.
Several companies already begun integrating web3 technology into their operations have shown similar interests. BeInCrypto reported early in 2022 that the entertainment industry was among the sectors at the forefront of this trend.
What is the future of IPs in web3 and NFTs?
BeInCrypto shares that there are two broad areas to choose from for IP regulation:
- A Creative Commons Zero (CC0) license allows artists to put their work in the public domain so anyone can reproduce it and profit from it.
- A solution between “all rights reserved” and “no rights reserved” gives NFT owners commercial or limited commercial rights.
Buying, selling and investing in Web3 real estate
Another trend we are seeing is the increased use of NFTs for non-fungible assets such as real estate and other physical assets, making it possible to trade and transact with them in the digital world.
According to Polygon, some of these web3 trends will change the way real estate is bought and sold:
- Creating digital property ownership records: Blockchain technology allows for creating tamper-proof records of property ownership, streamlining and securing the buying and selling process.
- Using smart contracts to automate real estate transactions: Smart contracts can automate the buying and selling of real estate, making it faster and more efficient.
- Fractional ownership of real estate assets through tokenization: Tokenization allows the creation of digital tokens representing the fractional ownership of real estate assets. This way, investors can purchase smaller property stakes. An example includes CitaDao, a DeFi platform that tokenizes real estate.
In 2023, web3 technology and NFTs will significantly impact some of the world’s largest industries, such as payments, consumer goods, and gaming. Furthermore, we expect significant advancements in blockchain technology and market infrastructure that will allow the technology to reach its full potential and scale to meet the increasing demand and adoption.
“Web3 is not just about a new technology, it’s about a new way of thinking. It’s about creating a decentralized future where everyone has access to the same opportunities and resources.”
VITALIK BUTERIN, CO-FOUNDER OF ETHEREUM
This article came directly from the Mintable blog, found on https://editorial.mintable.com/future-of-nft-utility-2023/