Here’s a Warning Sign for the Non-Fungible Token Marketplace
“It is a unique era”
by Bob Stokes
Updated: December 02, 2021
A non-fungible token (NFT) is a blockchain-based tool that enables people to monetize digital content and, as you probably know, it's become a major craze.
Here are some notable examples from earlier this year:
- Musician 3LAU sells the world's first-ever crypto-albums, making $11.6 million in under 24 hours (Business Insider, March 2)
- Beeple JPG File Sells For $69 Million, Setting Crypto Art Record (npr, March 11)
There are many more high-dollar NFT examples from 2021 and here's a more recent one from a Nov. 18 Harvard Business Review article:
[T]he NBA's Top Shot, which is owned by crypto platform Dapper Labs and enables fans to buy and sell tokenized video clips of basketball game highlights, has generated over $715 million in transaction volume.
So, yeah, this is big business.
Elliott Wave International views these sky-high valuations of digital content as part of an unprecedented financial frenzy. This is from the November Elliott Wave Theorist:
No stock market has ever been so absurdly overhyped and overowned. The same is true for junk bonds, real estate, cryptocurrencies and digital art. It is a unique era.
And, now, the world of the digital art marketplace is beginning to show some cracks.
Here's a Nov. 16 Fortune headline:
An NFT issued by the musician Grimes plunges in value by 84% as celebrity-minted tokens struggle in the market
The article goes on to provide more information about weakness in the celebrity NFT market.
Could this weakness be a sign of trouble for NFTs overall?
Well, keep in mind that the November Elliott Wave Theorist described the present as a "unique era."
The big-picture Elliott wave structure of social mood reveals that the financial world is either near or atop a crest -- the size of crest which goes with the word "unique."
That is saying a lot -- given the entire history of financial markets.
The bottom line is that there has never been a more important time to learn the big-picture message of the Wave Principle.
The Elliott Wave Theorist is part of our Global Forecast Service -- which you can learn more about by following the link below.
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