By Betsy Burton
Yes, NFTs Are the New Beanie Babies
In January of 2022, I wrote a blog titled “Are NFT’s the New Beanie Babies?“. In this blog I answered the question affirmatively by summarizing the same advice I gave my niece during the Beenie Baby craze:
If you like a piece, then buy it. Not because you think the price is going through the roof, but because it gives you pleasure and entertainment.
In January 2022, the market for NFTS was $12 billion. Today the NFT market is just over $1 billion and is projected to collapse even further.
What Happened?
The most significant impact on the NFT market was the crash of cryptocurrency.
For the most part, NFTs are bought and sold online with cryptocurrency. When investors cryptocurrency reserves decline so does their interest and ability to buy goods and services, especially discretionary and fad items.
Second inflation hit. With everyday costs of goods increasing, collectors have less to spend on superfluous goods.
Another reason is that the hype about NFTs faded. They were hot and interesting when sports stars, celebrities and influencers were hyping them. Once these NFT promoters started to see their potential revenues decline, they became less interested.
Bottom Line
Watch out for market flashes as a buyer and a seller.
Make sure you are buying something because you like it or think it will have a positive impact on your business.
Make sure you fully understand the supporting infrastructure and business model before investing.