Cryptos: What the “Bizarre” World of Non-Fungible Tokens May Be Signaling
“Each market frenzy seems crazier than the last”
by Bob Stokes
Updated: June 15, 2021
The world of cryptos includes something known as non-fungible tokens, which go by the acronym NFTs.
If you're unfamiliar with them, they're a bit bizarre but quite simple. Here's what our April Global Market Perspective noted:
Investors' manic behavior has expanded to include non-fungible tokens, paying large sums of money for essentially a picture of something.
Getting more detailed, "a non-fungible token is a unique identification code that is affixed to a [digital] asset using blockchain to distinguish it from all other [digital] assets."
Our April Global Market Perspective provided more insight with this chart and commentary:
The chart shows the performance of one of the most unseasoned of all collectibles, the non-fungible token (NFT), which first hit the market in December 2017... In addition to rocketing prices, NFTs surged into the culture at large with tokens tied to everything from basketball and football players to Passover and a Saturday Night Live skit. Capping the rage is a "digital collage" of bizarre, post-apocalyptic images called Everyday, which sold for $69.3 million through Christie's on March 10.
Well, the NFT craziness has persisted, as the May Global Market Perspective followed up by showing this NFT and saying:
Apparently, NFTs are still a thing. Paris Hilton, who is famous for being famous, garnered a bid of $1,111,211.00 for this Iconic Crypto Queen token on [April 25]. The absurdity of it all is not lost on everyone. "Each market frenzy seems crazier than the last," says MarketWatch.
As for one of the latest developments, on June 10, Barron's showed this image under the headline:
'Covid Alien' CryptoPunk Sells for $11.75 million in Sotheby's Sale
The reason for pointing out investors' interest in non-fungible tokens is to emphasize the level of financial mania that has been reached.
Follow the link below to see how our monthly Global Market Perspective employs Elliott wave analysis to forecast what's next for cryptos, global stock markets, rates, metals, energy, forex and much more -- over 50 of the world's biggest markets in total.
Cryptocurrencies and the “Crowd Factor”
The "crowd factor" with cryptos has its consequences.
Our June Global Market Perspective shared these remarks from a digital currency portfolio manager:
"You get this crowd factor," explained a digital assets portfolio manager. "Everybody's liquidation price tends to be somewhat near everyone else's--when you hit that, all of these automatic sell orders come in, and the price just cascades down."
Get more insights into cryptocurrencies in the section titled "How Selling Begets More Selling."
In the current Global Market Perspective, you'll also find Elliott wave analysis of global equities, rates, metals, forex, energy and more.
Prepare for trend changes that will likely catch most global investors off guard.
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