In 2024, the NFT market began to recover from the 2022–2023 crypto market downturn caused by the bankruptcy of the FTX exchange and a number of crypto lenders. The main factors of the current recovery are the increasing areas of use of NFTs across industries and the technological innovations used in their development. These changes are helping to create a more sustainable and inclusive market. As a result, the NFT market is attracting the attention of investors looking for new investment opportunities.
Current trends
The NFT market has moved from traditional digital assets (simple images) to products with practical applications. For example, NFTs that provide valuable functions in games and other applications are now popular. This trend helps stabilize the market and attract a wider audience. The segment’s capitalization has already exceeded $70 billion. According to the analytical portal CoinDesk, this trend increases the number of active users by 3 to 5 times.
New technologies and platforms
Solana has seen significant growth in trading volumes due to the speed of the blockchain and low fees of a few cents. Despite higher costs, Ethereum is also regaining its position due to improved scalability and new projects: Blur and Blast. That makes these platforms attractive to users and investors, allowing for positive developments in the NFT market.
You may also find this interesting: The most popular and unusual NFTs.
Support for innovation platforms
Innovative projects (including gaming platforms and utility applications) are gaining attention. Innovation in the gaming industry, where NFTs are used to own digital assets, has excellent potential. Projects offering music and art releases in NFT format are also popular. Given the growing demand for utility tokens, supporting such initiatives could be a lucrative strategy for investors.
Here are some examples of such projects:
- Axie Infinity;
- Decentraland;
- Kings of Leon;
- Nifty Gateway.
Market Dynamics
The NFT market is snowballing in Asia, especially in China, Hong Kong, and Singapore. For example, China and Hong Kong have seen a 40-50% increase in NFT adoption, driven by the popularity of blockchain games and new technology solutions. In Singapore, investment in this segment is also growing (35%) due to government support and technological innovation. These jurisdictions demonstrate strong dynamics and open up new opportunities for traders.
You may find this interesting: NFTs: digital assets of a new type.
Trends in Western countries
Western countries show lower engagement rates despite high NFT revenues. For example, in the US and Europe, user engagement levels remain 2-3 times lower than in Asian jurisdictions. That may be due to stricter regulation and a cautious attitude towards new technologies. However, the potential for multiple-time growth is present, especially with the development of new applications and platforms.
Selecting promising directions
The recovery of the NFT market in 2024 has opened up new investment opportunities for investing in cryptocurrency. Analysis of global trends allows us to identify the most promising areas for investment. For example, the rise in popularity of GameFi (game finance) and utilitarian NFTs is opening up new opportunities for investors. They focus on projects that offer application functions for the mass market.
Trending options:
- infrastructure investments;
- gaming apps;
- digital environmental projects.
Popular items from the Bored Ape Yacht Club and CryptoPunks collections have sold for hundreds of thousands of US dollars. However, predicting the profitability of new collections in advance is highly problematic.
Conclusion
The dynamics of the non-fungible token market have improved in 2024. The transition to practical products and the evolution of the Solana and Ethereum platforms create the opportunity for stabilizing the market and attracting capital. Asian markets, including China and Singapore, are experiencing high growth rates, creating favorable conditions for regional investment. Our experts will advise on issues connected with starting a corporate bank account in a bank or a payment system for a cryptocurrency business.
17 June 2024 