View from the City: Is the NFT boom about to implode?

For those who claim that Fortnite really took off with its merchandising link-ups, take a trip down memory lane and play NBA Jam. The right key-combos unlock hosts of wacky characters such as Bill Clinton or Prince Charles lining three-pointers alongside Scottie Pippen. While perhaps worth a few retweets, someone this summer created a non-fungible memento celebrating these actual characters. And, currently priced at $250 a collectible, they became ‘veritable’ keepsakes for investment purposes.

Cynical? What about breeding virtual monsters and leading them into battle – for profit? The rise of pay-to-earn games has surged the underlying price of the coins powering these worlds and unlocked a full-time profession for would-be ‘axies’ making (real-world) living out of farming salamander-esque digital animals.

This is no fleeting fad a la Pokémon, or so reckon a16z and infinity ventures, which are betting big on NFT-gaming markets. Similarly, a lot of serious money is behind the likes of Autograph and Rarible. And for those who wish to ride the sentiment wave, there are the underlying coins to HODL, such as AXS, ATLAS or good old-fashioned ETH for mostly anything that’s nift-able. Prices have reached stratospheric levels this year, and there’s evidence to suggest we’ll soon be able to invest in ETCs that vest in tokens as say, oil or platinum.

Still convinced this will all implode? Historically, you’d be on the right side of sceptical, as the only assets to really thrive across generations are gold and Microsoft. That said, industry ‘veterans’ have been calling the death of bitcoin for over a decade and look where it stands today. Numismatically speaking, nothing should prevent the coin-equivalent of an Amazon or Facebook to rise among the ocean of the crypto-stocks. That isn’t to say there won’t be any serious market reckonings or price corrections, but as with Fortnite or NBA Jam, the trick is to know when to jump before you get fragged.