NFT breaks the circle? Why can an avatar make millions of dollars?

NFT breaks the circle? Why can an avatar make millions of dollars?

Since the beginning of this year, the term NFT has frequently appeared in the public eye. Why is NFT so popular? What types of NFT are there? Is NFT hype or consensus? This National Day special, let’s talk about some of the hottest NFTs this year.

The full name of NFT is “Non Fungible Token”, which is a non-homogeneous token, which is a digital asset on the blockchain. Different from homogenized tokens, NFT is essentially a blockchain-on-chain token with uniqueness, indivisibility, and difference. It maps offline data content to data through links on the chain. The asset-based carrier of content realizes the value circulation of data content, so that it can mark the ownership of native digital assets to anchor real-world commodities. Through its characteristics, NFT provides a feasible way to virtualize real assets, which is of great significance in today’s accelerating digitalization.

Since the encryption technology enthusiast Hal Finney put forward the concept of encrypted trading card in his community Cypherpunks group in 1993, NFT has a history of about 28 years. The NFT application field is gradually expanding, expanding from the original niche circle to the art circle, cultural consumption circle and other major circles, involving art, copyright, sports events, meta universe, etc., and the industrial ecology is gradually taking shape. With the continuous emergence of art collection projects, traditional companies such as Christie’s, LV, Gucci, Visa, etc. have also begun to deploy in the NFT field.

In terms of market size, in general, the NFT market is still in its infancy at this stage, and the market penetration rate is still relatively low. Compared with Bitcoin, which is popular all over the world, the overall market value of NFT in 2020 is only 0.17% of BTC , and the market is relatively small. Crowd. However, due to its huge imagination and clear asset transaction attributes, the scale of the NFT market has shown rapid growth in recent years. According to the data of NonFungible.com, from 2018 to 2020, the total market value of NFT rapidly increased from 41 million US dollars to 338 million US dollars, an increase of more than 8 times, with an average growth rate of more than 400%, an amazing growth rate. According to CoinGecko data, 2021H1, the NFT industry The overall market value reached US$12.7 billion, an increase of nearly 310 times compared to 2018. In 2021, the NFT market will usher in explosive development. According to statistics, as of September 1, the total market transaction volume of NFT has reached approximately 5.9 billion U.S. dollars, of which the Q2NFT market transaction volume reached 754 million U.S. dollars, a year-on-year increase of 3453%. The month-on-month growth is 48%, and it is predicted that under the influence of its continuous expansion, it will explode with even more amazing growth potential.

NFT breaks the circle? Why can an avatar make millions of dollars?

In terms of subdivisions, the virtual world, artwork and games are the most important application areas of NFT in 2020, and the three together account for 72% of the NFT application areas. After that is the sports field, occupying the fourth place in the application distribution with a proportion of 13%, and virtual assets at the end, occupying only 4% of the total application share. It is worth noting that in the Q2 quarter, the proportion of applications is obviously inclined. Driven by phenomenon-level products such as CrytoPunks, Bored Ape YC, etc., the transaction volume of the collectibles field ushered in a bright moment, the proportion of applications has increased significantly, and the proportion of applications has increased rapidly. Increased to 66%, the application gradient is highlighted. The previous strong artworks and games have fallen to 14% and 5% of application shares respectively.

NFT breaks the circle? Why can an avatar make millions of dollars?

CryptoPunk 7804 was sold for 4200 ETH , valued at USD 7.57 million, Visa bought CryptoPunk 7610 for USD 150,000, and Curry bought Bored Ape YC for USD 180,000. Since 2021, avatar projects have shown strong growth momentum. Ushered in its bright moment in the market.

According to Messari data, avatar NFT projects have become the top 3 market share players in the NFT digital art market. In the second quarter of 2021, avatar NFT projects generated nearly US$350 million in secondary sales, an increase of 40% from the first quarter. , And as of 2021, according to incomplete statistics, avatar projects have generated more than 1 billion U.S. dollars in sales.

In terms of specific applications, the market demand for avatars is relatively concentrated, and the head effect is becoming more prominent. Estimated and calculated based on the rarity data, and estimated market value based on the 7-day average transaction price of ETH, CrytoPunks maintained an absolute lead with nearly 50% of the market share, followed by Bored Ape YC and Meebits, which together accounted for 76% of the avatar market share. %about. Waist-like avatar projects such as Cool Cats and Hashmarks continue to fluctuate according to different market shares, but the overall performance is relatively stable. At the same time, as the avatar market is getting hot, emerging projects such as CyberKongz VX and 0N1 Force are also emerging.

NFT breaks the circle? Why can an avatar make millions of dollars?

Although from the overall perspective of the market, the NFT avatar market is still niche, and most of its project market holders fluctuate at around 2-5 thousand, its demand is still showing a steady growth trend. Taking the representative CrytoPunks as an example, OpenSea data shows that as of August 31, the transaction volume of CryptoPunks in the past 7 days has increased by 143.59%, and the monthly average transaction price has increased by 116.26% month-on-month. Its total transaction volume has broken down on August 23 800 million US dollars, a record high. The 0N1 Force, which was launched on August 20, currently has a transaction volume of more than 38,305.33 ETH, with a total number of transaction holders of 3,900, and the floor price has risen to 3.4 ETH.

NFT breaks the circle? Why can an avatar make millions of dollars?

The popularity of avatar apps can also be seen from the burning data of Ethereum. According to data from the Ethereum burning tracker Ultrasound.money, the NFT avatar project CyberKongz VX after its launch on August 15 exceeded that of OpenSea and Uniswap with 1437.13 ETH burning. V2, Axie Infinity and other projects quickly jumped to the first place on the 24h burning list of the day, and once again saw the fiery feedback from the market on avatars.

NFT breaks the circle? Why can an avatar make millions of dollars?

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