In recent years, non-fungible tokens (NFT) has emerged from obscurity to become a vital part of the broader cryptocurrency industry.
Analysts and market participants have forecast a prosperous future for the market in light of this new reality.
According to a recent MarketsandMarket research, the NFT market is poised for a 35 percent increase by 2027.
This means that the existing $3 billion market size will reach $13.6 billion by the end of that year based on the Compound Annual Growth Rate (CAGR) of 35.0% — if the interest among investors continues to grow.
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NFT Driving Forces
The growth of mainstream influencers, gaming communities, and the expanding demand for digital artworks will continue to be the driving forces behind the worldwide NFT boom over the next five years.
During the forecast period, the increasing influence of celebrities to fuel the momentum of NFT adoption, transforming the gaming sector, and the sluggish but persistent rise in demand for digital artworks are anticipated to drive the global NFT market.
In addition, the expanding applications of NFT in supply chain management, retail, and fashion, as well as the efforts of industry titans to make the metaverse a reality, would give NFT market providers with lucrative potential for personalization.
Level Playing Field
The non-fungible token market provides a level playing field for both buyers and sellers to flourish. With this, both buyers and sellers can profit substantially in many ways.
A further element that has contributed to the success of NFTs in China and other Asian nations is the resistance to cryptocurrencies.
Compared to other Asian nations, China has struggled to establish a legal framework for cryptocurrencies due to the government’s preference for digital yuan ambitions.
Crypto total market cap at $1.59 trillion on the weekend chart | Source: TradingView.com
Asia-Pac Countries Among Big Players
Recent Google Search Trends data indicates that countries in the Asia-Pacific area are trending toward constant market developments and marketplace launches to provide creators and buyers with equal possibilities in the ecosystem.
On the year-to-date basis, the non-fungible token sector beat the overall crypto market, according to a research from Nansen. The blockchain analytics company anticipated that the market capitalization of NFTs might reach $80 billion by 2025.
NFT marketplaces — platforms that enable investors to buy and sell digital artwork and other related materials — are currently projected to contribute the highest to the expansion of the space.
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Industry leaders are hopeful that NFTs will be the way the Metaverse makes money in the next few years. (Image credit: Search Engine Journal)
Revenue Model For The Metaverse
While established firms such as OpenSea currently dominate this industry, crypto exchanges such as Coinbase and Binance have begun to offer comparable services for exchanging non-fungible tokens in the open market.
The Metaverse is a concept for an internet-enabled virtual world in which users interact with digital assets using Augmented Reality (AR), Virtual Reality (VR), and Extended Reality (ER) (XR), and the emergence of blockchain technology is accelerating this development.
Industry experts are optimistic that NFTs are going to be the revenue model for the Metaverse in the coming years.
Featured image CNBC, chart from TradingView.com