The market for non-fungible tokens took a nosedive this year. Now, die-hard evangelists think the key to success is finding different ways to use them.
The thread connecting most of these applications is the use of NFTs and economic incentive as the foundation for community-building. Even creators originally drawn to NFTs for the monetization opportunity are cottoning on.
There is a shadow of uncertainty hanging over all of these endeavors as a result of a lack of regulatory clarity. There are no NFT-specific regulations anywhere in the world, which creates a level of risk for any business that might consider investing in the technology. Equally, this means there is no recourse for people who have lost considerable sums of money on failed or abandoned NFT projects no longer supported by their creators.
There is also the question of whether NFTs will really work the way people think. The rules of supply and demand, says economist Peter Schiff, dictate that NFTs will not and cannot hold their value over time. Although Schiff admits there are potential use cases for NFTs, like transferable memberships, he sees these as only marginal improvements on systems that already exist, not as the “game-changers” they are dressed up to be.
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