The NFT party is far from over
Good morning, and welcome to Protocol Fintech. This Thursday: brushing off crypto winter at NFT.NYC, eBay buys KnownOrigin, and Hester Peirce nixes crypto bailouts.
Co-byline with Ryan Deffenbaugh
Crypto winter wonderland
With Bored Apes and CryptoPunks beaming from Times Square billboards and thousands of collectors and creators meeting in person for the first time, last November’s NFT.NYC was described in the New York Times as a coming-out party for the Web3 world.
Seven months later, blockchain aficionados are descending upon Manhattan for the fourth annual NFT.NYC conference under sharply different circumstances: what even the biggest bulls are calling crypto winter. Despite that, the party rages on this week, with daytime panels and networking giving way to Deadmau5 concerts at night. Times Square is once again home to massive digital billboards from MoonPay, Coinbase NFT and Rubber Duckz, among others.
We don’t talk about winter, no, no. “At NFT.NYC, the circles I’m in aren’t talking about prices,” tweeted Chris Cantino, a partner at venture capital firm Color Capital. “Aren’t talking about leaving crypto. Aren’t talking about the next fad or flip. They’re talking about the future, and how they are going to build it.”
It might appear that the reported 15,000 attendees of NFT.NYC are suffering from a collective delusion, given the crypto bear market. But there’s a little more to it.
The value of the crypto market is sinking in general. Bitcoin, the world’s most famous token, fell below $20,000 for the first time since 2020 over the weekend. Ethereum and solana, the tokens most commonly used with NFTs, have fallen about 71% and 79% this year, respectively.
Falling prices combined with lower transaction volume means that, in dollars and cents, the NFT market is tanking. NFT marketplace volume fell to just over $4 billion in May, from $7.2 billion the month before.
But a focus on dollars means you’ll miss the rise in volume. Chainalysis describes the current moment as a market “stabilization” after a booming 2021, not a crash. The firm also points out that collectors sent $37 billion to marketplaces like OpenSea between January 1 and May 1 of this year — already on track to cross the $40 billion threshold set in 2021 before the year’s half over.
NFT.NYC showcased both crypto’s optimism and its eccentricity. There are plenty of panels with names like “Intellectual Property Considerations Raised by NFTs.” Then there was the “God Hates NFTs” protest/marketing stunt and a Snoop Dogg impersonator going by Doop Snogg.
“There are folks in the space now who have survived a couple of crypto winters,” said Gavin Gillas, co-founder and CEO of Project Venkman, an NFT-focused rewards company. While projects that were seeking quick wins are destined for a shakeout, he added,“the focus long term is that it is time to build.”
Gillas’ Project Venkman and the Chive on Wednesday debuted images at NFT.NYC of the Bill Murray 1000, an NFT collection with original artwork featuring the comedian. Murray recounted 100 stories for the project that will be featured in 10 colors apiece. The Murray project is evidence celebrities are still jumping on board with Web3 projects. His son, Jackson, appeared on stage Wednesday for the debut.
The project will debut next month on Coinbase’s NFT marketplace, one of the first collections to launch there.
Coinbase is not alone in expanding its NFT business, despite the downturn. Yesterday, eBay said it had bought NFT marketplace KnownOrigin for an undisclosed sum. VCs, whose job it is to predict the trends, are still bullish as well. NFT-focused startups have raised $2.9 billion in the first five months of the year, according to PitchBook, outpacing the investment of 2021, despite values falling. No one knows when, or how, this crypto winter will end, but for now, NFT fans are still putting the “fun” in “fungible.”
Protocol link: https://www.protocol.com/newsletters/protocol-fintech/nft-nyc-bill-murray