Market sentiments’ have shown that non-fungible tokens (NFTs) have faced a downfall in recent months. With market conditions plunging and increase in hacks and low-quality projects, NFT projects such as the Bored Ape Yacht Club has suffered the consequences with floor prices dropping below $100,000 this year, as stated by Cointelegraph.
According to Cointelegraph, NFT market conditions have been correlated on the basis of general cryptocurrency market conditions. With technology and digital assets increasing in valuation, individuals and speculators speculating on the NFT asset class has become justified, with payment of premiums on the belief that tangible utility and value might be derived in the future. Market conditions have been tied with developments in the ecosystem, which include presence of frauds and oversaturation. As a result, concerns for parties involved in the space is expected to increase along with hesitation for consumers and businesses looking to enter the space.
On the basis of information by Cointelegraph, over-speculation followed by other struggles is not only to be expected but would need users to take action for growth of these digital assets. While scams and hacks are bad for projects in the NFT ecosystem, creators should implement measures to prevent work to be duplicated and sold under somebody else’s name. NFT projects should have measures to prevent a hacker taking advantage of infrastructure vulnerabilities. Moreover, early supporters shouldn’t be afraid about project leaders running out of working capital or abandoning the project in preliminary stages. Additionally, companies and projects need to find ways internally on how to protect their customers.
Furthermore, Cointelegraph noted that NFTs are aiming to build the next generation of products and services, as market behavior suggests that NFTs are here to stay for the long-term, as NFTs represent digital ownership which is both immutable, transferable and serve as digital identification for events in metaverse.
(With insights from Cointelegraph)
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