NFT Development Trends to Expect in 2023
A non-Fungible Token (NFT) is a digital certificate with encryption and blockchain verification. It is the leading technology trend in 2021 and a promising one for the future. The search engines show that people were more interested in NFT than Bitcoin or Ethereum. Furthermore, the value of NFTs is more constant than digital currencies offer. Many companies consider NFTs as a payment method. Also, non-fungible tokens can be created from practically anything: digital images, articles, music, etc. The main advantages are adaptability and the opportunity to transfer the ownership right for particular services and blockchain products.
The Security and Exchange Commission (SEC) works on regulation and requires the registration of these assets before allowing public sales. SEC frequently verifies the correspondence to the ‘’investment contract’’ notion so that to define whether an investment suits the securities definition.
Considering NFTs, if an asset is a painting or other art, it can be viewed as a collectible, not security. An NFT will be under the SEC control sphere if the creator mints a token as an investment that requires initial assessment. For instance, Nike creates a limited collection of 100 NFTs. The company notifies the clients that each NFT will gain value with time since there are only 100 tokens. Furthermore, they will spend the money received on creating new trainers closer to securities than collectible items. If the brand tells the clients that they can resell the tokens and make money, the company would hardly avoid registering the token as a security.
Fractional NFT (F-NFT) is also popular. This product allows investing in an NFT share and helps buy several NFT shares. Fractional, Niftex, and other platforms help people buy and sell F-NFT like investors trade assets, and collectors sell stamps or eBay cards.
Anyway, if a company creates NFTs to raise funds and produce products and services, they must get consulting from securities experts to see whether they adhere to the laws and regulations.
In 2021, many news outlets published articles on NFT paintings sold for thousands or millions of dollars. Indeed, people pay a lot of money for digital products (images, songs, real estate, etc.). The market value is approximately 40 billion dollars, and NFTs' popularity is growing. Hence, it is beneficial to understand the main technology development trends for 2023. Knowing why non-fungible tokens are so expensive, their use, and why investors like them are crucial.
The main features of non-fungible tokens are uniqueness, own price, and value. These tokens are unique; one token can’t be exchanged for another or split into parts. For instance, one Bitcoin is one unit that can be distributed among other market participants; a dollar can be divided into 100 cents, etc. Again, an NFT is a non-fungible unit.
An NFT is a certificate that guarantees ownership over an asset to its owner. Things like art pieces, game items, real estate, etc., can be minted as an NFT.
As the demand for tokens grew, there were developed NFT marketplaces as independent platforms for buying and selling digital items. The biggest and most popular service is OpenSea. It has functioned since 2017, yet in 2022 the platform achieved its highest trading volume of 3.5 billion dollars.
Buying and selling NFT is also possible on:
Expectedly, by 2026 the NFT market will reach 100 billion dollars. The average yearly growth will vary between 40-50%. It is worth looking out for the trends and opportunities to enter the early market.
Despite statistics and digital and technological advances, tokens seem rocket science to many people. Yet, the trend is gaining attention, and global brands, large companies, funds, and investors have decided to take advantage of it. The situation with cryptocurrencies was quite the same at its early stage, yet in 2022 it is used globally. Still, somewhere it is more accepted, and somewhere less.
No one can predict the future for NFTs, but analysts and experts are sure that these tokens will become a helpful tool for monetizing skills, services, and products. It is essential to understand this environment's main benefits and trends since it’s popular and developing.
Collectors and gamers pay much attention to tokens since they require NFTs to get unique and rare weapons and game cards. The non-fungible tokens sector already has its history. Mike Winkelmann is a famous artist called Beeple in the digital world. In March 2021, he sold a collage for 69.3 million dollars.
There were also some other significant bargains in the NFT world. For example, the Twitter founder got 2.9 million dollars for his first tweet, a Times journalist sold tokenized covers, and Elon Musk created the first NFT track. There are numerous examples, and the story continues.
However, not only famous and rich people succeed in this environment. The sector has no gender, age, or other limitations. This is one of the reasons why NFTs are popular, and everyone can get the copyright for a unique product and make a lot of money on it.
An Indonesian student made 1 million dollars on OpenSea selling his NFT selfies. His name is Sultan Gustaf Al Ghazali, and he sold about 1000 selfies.
The market is becoming vast; in 2022 there was released the first tokenized series, GenZeroes. Only those users who bought the NFT can watch it.
Ukraine didn’t miss the trend too. Alyona Alyona, a singer, earned about $7000 selling the NFT of her song ‘’Galas’’. Ocean Elzy band split a piece into fragments and sold them as tokens.
Non-fungible tokens are a new phenomenon in the cryptocurrency world that quickly became mainstream and is considered the primary software development trend in 2022 and 2023. NFT is a part of digital content directly linked to blockchain and cryptocurrency. Tokens are unique and not interchangeable; this is why there won’t ever be two likewise assets. This explains the increasing popularity of blockchain payments that provide complete security, high speed, and transparency for any amount.
Non-fungible tokens' advantages:
The world initiated tokenization and digitalization, many standard processes are now digital, and governments have begun to use blockchain. NFT allows tokenizing services and products.
Earlier it was hard to imagine paying via card or phone, yet it is not a big deal in the modern world. The same will work for NFT; people use the technology more often. In the future, digital wallets will store documents, certificates, and other elements.
There are multiple platforms to implement this idea in the decentralized finance (DeFi) sector. These platforms allow employing NFTs as collateral before receiving the credits. Arcade is one of the most popular DeFi platforms for crediting with NFT security interest. After an agreement with all terms, assets are locked in an escrow account managed by a smart contract. Until the loan obligations are repaid, or default occurs, NFTs cannot be returned and locked.
Another trading resource is NFT, where people can place assets as collateral for a loan or offer a loan to another person. Credit is given in ETH cryptocurrency if there is any ERC-721 network token against collateral. When the loan is paid, the NFT is returned.
As NFT went viral, gamers understood that they could take advantage of it. Many projects help gamers employ NFTs that unlock new opportunities. Blockchain games in the future will require loads of tokens, and it is a famous domain sector currently.
The gamers can use assets to create game content and sell it on OpenSea or similar platforms. NFTs are a vital element for blockchain games. In the future, it will be the gold standard in this sector. Pay attention to this technology and start using it for game development.
The games use tokens, which can easily be turned into an item to support the gamer or get an extra level, points, and more. According to the developers, the technology can reduce the cost of creating games and increase community loyalty. More NFT are implemented on the physical elements for gameplay, for example, on the cards, and then transferred to a digital format using blockchain protocols.
Since 2021, new games that focus on the "play and earn" (P2E) model and the most popular one is Axie Infinity, are actively being released. NFTs tied to the gaming industry in 2021 have generated over $4.5 billion in revenue. Since the beginning of 2022, the trend has continued, with the game industry continuing to show profitability.
GameFi allows you to work with different items within the game; they can be in the form of cards, weapons, clothing, or avatars. After earning tokens, players sell rare NFTs in markets, making real money. The NFT sector is expected to change the gaming industry entirely through this flow.
Immediately after creating a unique digital token on the blockchain, the sale is made digitally to the customer. This allows assets to be stored in a digital wallet and used anywhere, on any device. Digital tickets are the new trend in the development of any event. When selling, owners can create a sufficient amount of NFTs, encode them to determine the value, or make an auction where the customer can bid their price.
Similar to other areas, people will be able to keep the ticket in their wallet and provide it while attending the event. The NFT trend is headed for growth in the coming decades, and ticketing is a new area to consider. Many companies have already created and launched their real-time tickets to test the technology.
Many PFP NFTs projects are only 50% of avatar (head and shoulders), which is perfect for 2D online social work. BAYC, CryptoPunk, and NFTs can be employed as unique profile images or authenticators on specific platforms.
With the help of a digital twin, it is possible to duplicate any service or product. This is done with the use of virtual reality and simulation methods. The technology helps to make or copy authentic goods and services in a digital form.
Data is exchanged between the copy and the actual physical object. Updates are made through sensors, which help keep track of conditions. Many prominent global brands have started using the digital realm, doing everything through NFT look-alikes. As an example, look at Adidas and its association with Karlie Kloss. Such a duo allows customers to use the brand's digital sneakers on a blockchain.
NFT can be created with artificial intelligence, but in 2022 a new trend began to emerge, which will continue in 2023: the integration of AI into NFT. This could provide a wholly unique and dynamic experience, with no way to replicate it with other technologies.
Alethea AI is the first decentralized protocol to create intelligent avatars that apply artificial intelligence to interact with society. A good example is iNFT "Alice," with extensive self-learning capabilities. A new flow of knowledge constantly comes when there is contact with people. The developer company has already received more than $16 million for scalability and is striving to make a metaverse where artificial intelligence will learn from each other.
The subsequent developing trend is NFT music. The sector is not too popular, yet musicians and fans can earn money in this ecosystem. NFTs allow provoking shortage, and musicians receive 100% ownership and control over their pieces. As a result, their content will not be that easy to distribute without copyright.
In addition to the ownership rights, authenticity is established, and a new community is formed around NFT and music, providing musicians with autonomy. By 2025, the NFT music industry is expected to reach over $80 billion in capitalization.
Art is the primary trend in the NFT sector at the moment. The market is growing and allows artists to express themselves. For example, art foundations that create digital art from physical works increasingly attract influencers to this trend.
The newest trends are metaverse galleries and auction houses. The platforms help authors of paintings place their works in digital galleries of the metaverses. You need special glasses to visit these exhibitions.
No less rapidly are developing auction houses. People bid for tokens themselves to be the sole holder of NFT. According to experts, in the next few years, artists will begin to get rid of physical works, which will lead to an increase in demand for digital art.
The COVID-19 pandemic caused the acceleration of the development of digital solutions, so blockchain and NFT have found their place even in the medical sector. A blockchain-based medical services marketplace has been developed, allowing information about patients (if they want it) to improve the quality of services. There could be a similar thing with NFTs, thanks to which monetization of information through tokenization will begin.
In the future, NFTs will be used to help support the population's well-being. Health Hero, a meta-world character, is an excellent example of an active link between medicine and tokens. By leading a proper and healthy lifestyle, character and other qualities are developed, after which one can sell the avatar within the digital world.
Blockchain and NFTs provide security and protect the information, so in medicine, it will be possible to solve health care sector problems, such as personal data theft or threats.
The biggest problem with long-term investments in real estate is ownership rights and the issue of transferring them. NFTs solve such a problem, which helps investors confirm ownership of a particular property in minutes. Therefore, using tokens in real estate is a good trend for development in 2023.
Blockchain technology paired with tokenization increases the security and safety of information. It can protect buyers and sellers, significantly speeding up and simplifying the transfer of such assets. Very few companies use NFT in real estate yet, but it is a new trend that will soon enter the masses due to its flexibility and several other advantages.
The next development trend for 2023 is virtual lounges, which will appear on the market in 2022. Blockchain, sites, and other platforms cannot keep growing, which is the main problem of NFT demand. Considering tokens traded on auctions and other resources, media can be subject to damage from the number of participants, and virtual waiting rooms solve the problem.
They are set up as a separate place where customers can wait for some time before dropping an NFT. With 3-5 or more drops, multiple waiting rooms can be created at once to further process transactions seamlessly. With this trend, more and more ideas will emerge.
The field of Web3 digital assets is rapidly evolving; it's hard for humanity to accept it yet, but also impossible to resist. Many influential and famous people have already tried one or another of the products of Web 3.0, which made it possible for large companies to implement NFT in their marketing.
NFT reduces the initial investment in any business; tokens allow you to solve tracking problems because companies can control the impact of NFT on marketing approaches.
NFT has been on trend since 2021 and will stay on-trend. This market is evolving rapidly, and it's important to start understanding the intricacies of today and understanding new methods to capitalize on this space. Some trends will require time, but some have already contributed to the ecosystem to help it grow.
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