It’s no secret that non-traditional financial instruments are on their way out.
However, a fresh assessment from industry experts has revealed that the cryptocurrency is nearly useless.
The latest analysis titled ‘Dead NFTs: The Evolving Landscape of the NFT Market’ by NFT Scan and CoinMarketCap surveyed 73,257 NFT collections and discovered 69,795 have a market cap of zero Ether (ETH), according to Rolling Stone.
In other words, 95% of all NFTs were worthless.
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According to the report, 23 million investors own these worthless NFTs, implying that they have undoubtedly lost money on their investment.
Even for the most expensive collections, the most frequent price is between $5 and $10.
“This daunting reality should serve as a sobering check on the euphoria that has often surrounded the NFT space,” according to the research.
“Amidst stories of digital art pieces selling for millions of dollars and overnight success stories, it’s easy to overlook the fact that the market is fraught with pitfalls and potential losses.”
NFT reached its high in August 2022, with $4.2 billion exchanged in the market.
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As a result, these babies landed hard and fast.
An NFT of Twitter founder Jack Dorsey’s first tweet, which sold for $2.9 million to Sina Estavi in July of this year, had an initial bid of $1.
Estavi floated the NFT several times and had no proposals that were even close to what he spent for it.
The opening bid on his most recent attempt to get rid of the NFT was only 0.0006 ETH ($1.13). Ouch.
And, while the winning bid was more than three grand, it was still a long way short of what Estavi paid.
According to Chainalysis, the average price of non-fungible token sales has dropped 92% since the beginning of May 2022 (from $3,894 to $293).
The dramatic value reduction, according to Stephen Diehl, co-founder of the Center for Emerging Technology Policy and co-author of the forthcoming book Popping the Crypto Bubble, is due to the digital currency being riddled with scams.
“Crypto exchanges don’t trade regulated financial products like stocks or bonds; they trade unregulated financial assets, which are crypto tokens,” he said MSNBC in November 2022.
“And these tokens are not subject to the same level of regulation as most other market products.”
“A lot of the problems that arose as a result of the recent disaster were caused by a lack of regulation of these products.”
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