NFT market slump shows it’s maturing toward ‘genuine utility,’ execs argue

October 15, 2023 Coin Telegraph

Decentraland Foundation executive director Yemel Jardis believes as people become more educated about NFTs, the focus will shift from speculative trading to genuine utility.

A steep collapse in the price of nonfungible tokens (NFTs) shouldn’t be seen as a sign of distress but rather a signal the technology is maturing, according to Web3 executives.

“I wouldn’t say the NFT market has regressed,“ Decentraland Foundation executive director Yemel Jardi told Cointelegraph. “Rather, it’s maturing."

Jardi’s comments come after a September report from dappGambl that analyzed over 73,000 NFT collections and concluded that as much as 95% of the NFTs studied had no value, as prices, sales volume and transactions have slid over the past year.

Jardi stressed that markets are cyclic and it is natural for there to be periods of adjustment.

He attributed sliding NFT floor prices partly to “speculative trading” and said the value of NFTs should instead be anchored to their utility.

“As people become more educated about NFTs, their use cases and their utilities, the market will stabilize and the focus will shift from speculative trading to genuine utility and innovation.”

Anjali Young, co-founder of the tokenized community-management platform Collab.Land, isn’t surprised about the anti-NFT sentiment either.

“Any innovation — especially this one with financial impact, cultural value and status — will attract questioning during its downs,” she said.

Young believes many projects have stumbled since marketplaces such as OpenSea removed mandated royalty fees in late August.

Despite this, Young claimed that NFTs are “here to stay” and expects they will be more frequently used for loyalty programs, rewards, advertising and proof of authenticity in the coming months.

They've left us all for dead, saying 95% of NFTs are worthless.

But the truth is very, very different.

Look no further than car companies and their adoption of NFT tech ️

From collectibles to supply chains, perhaps no industry is more bullish on Web3.

A short thread
— Rarity Sniper (@RaritySniperNFT) September 23, 2023

Tama Churchouse, chief operating officer of Cumberland Labs, recently opined that NFTs aren’t “dead,” arguing that recent developments in the space show there are still signs of life.

While the NFT market has primarily been dominated by digital art, Jardi said that nonfungible tokens remain an important tool for the broader digital landscape, as ownership of tangible assets can be denoted to users in novel ways.

Wow, someone just listed a $26.5 million building in one of New York City's most prestigious areas as an #nft.

Handling property rights through NFTs is a very exciting use case to cut out the middle men. #realestate #nfts #NFTCommunity #nftcollector pic.twitter.com/PowOwwMZsb
— Chris Wieduwilt (@deloreanchris) June 6, 2022

Jardi believes governments and institutions will leverage NFTs in the future for various use cases. On Oct. 9, the Chinese-state-owned newspaper China Daily announced plans to launch a platform for trading digital collectibles.

The entertainment sector is another huge market for the NFT industry to capture, according to Scott Lawin, CEO of sports token platform Candy Digital.

Lawin told Cointelegraph that 24% of Major League Baseball fans who entered stadiums with mobile tickets in 2022 redeemed their complimentary commemorative digital ticket provided by Candy as a form of memorabilia.

“Those are all utilities of NFTs in real time,” Lawin added.

On the brand side, Adidas, Bud Light, Gucci, Prada and other companies dipping into the NFT space have seen a recent uptick in the number of active users on their Discord channels, Young said.

The NFT market capitalization currently stands at $5 billion, according to data from Forbes Digital Assets. The Yuga Labs-owned CryptoPunks and Bored Ape Yacht Club collections are the two largest, with market caps of $710 million and $400 million, respectively.

Magazine: NFT Collector: William Mapan’s Distance sells out, NFT float in Macy’s Parade, Nouns DAO forks

NFT-optimized Palm Network to become a Polygon ZK Supernet

July 27, 2023 Coin Telegraph

Candy Digital

The Ethereum sidechain will transition to a proof-of-stake network this August and become a full-fledged layer 2 based on Polygon’s zero-knowledge protocol in 2024.

Nonfungible token-focused blockchain Palm Network is about to become a great deal more accessible to users, with plans to transition into being a customized Polygon blockchain.

According to a July 26 announcement, Palm Network will soon become a Polygon (MATIC) ZK Supernet, which will see minting, trading, and collecting NFTs becoming more readily available to its users.

Additionally, Palm Network will become interoperable with Ethereum and the rest of the Polygon 2.0 ecosystem.

PALM on the journey to become ZKL2 with polygon Technology!

Don't miss a talk with @lerdiedabirdie from ED @palmfdn and @sandeepnailwal , the Founder of @0xPolygonLabs.
Set your reminder now! ️https://t.co/pRDSFbtNaC pic.twitter.com/SutmzzqTMS
— Palmfdn (@palmfdn) July 27, 2023

Polygon “supernets” are customizable blockchains that are created using Polygon consensus software, while the term “ZK Supernet” refers to a network that uses zero-knowledge proofs to process deposits and withdrawals from Ethereum.

Palm Network’s transition to a Polygon Supernet will take place in two stages. On August 23, it will transition to a proof-of-stake (PoS) consensus mechanism network. Then sometime in 2024 it will transition into a ZK-based layer-2.

Palm Network has partnered with NFT marketplace Candy Digital, which carries licensed NFTs from NASCAR, Major League Baseball, Netflix, Warner Brothers, WWE and other brands. The digital art distributor HENI is also built on the network.

*Candy Digital marketplace on Palm Network. Source: Candy Digital*

Palm is currently an Ethereum (ETH) sidechain, which means that it relies entirely on its own nodes for security.

Once the transition process is completed, transfers between Palm Network and Ethereum will be processed using Polygon’s zero-knowledge proof protocols, making their security partially dependent on the Ethereum blockchain and therefore potentially more secure.

Polygon co-founder Jordi Baylina praised Palm’s move, saying that it will lead to greater accessibility for users without sacrificing security:

“By leveraging Polygon Supernets technology, developers of Palm Network can preserve the user experience amid even the highest network activity while minimizing the gas costs for its community — resulting in a significantly more accessible and democratic ecosystem.”

Over the past few months, the Polygon team has been working to create an ecosystem of multiple ZK supernets joined together through its software, a system they have referred to as “Polygon 2.0.”

They face competition from Optimism’s “Superchain,” a similar multichain vision based on the OP Stack software. ZkSync has also announced that it will be building a multi-network ecosystem made up of “Hyperchains.”

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

Magazine: Tokenizing music royalties as NFTs could help the next Taylor Swift

Mastercard Launches NFTs to Support Emerging Musicians Through Web3 Technologies

April 13, 2023 Bitcoin.com

Filecoin Creator Protocol Labs Announces Layoffs Amid Crypto Winter and Economic Downturn

February 5, 2023 Bitcoin.com

Report: Fanatics to Sell 60% of Candy Digital Stake Amid Struggling NFT Market

January 5, 2023 Bitcoin.com

Fanatic sells 60% stake in Candy Digital amid ‘imploding NFT market’

January 5, 2023 Coin Telegraph

Candy Digital

The sports merchandise giant has got cold feet in the shrinking NFT market.

Sports merchandise firm Fanatics is divesting its stake in nonfungible token (NFT) company Candy Digital as confidence in the asset class wanes.

On Jan. 4, it was reported that Michael Rubin’s sports company Fanatics was offloading its majority 60% stake in the NFT startup.

Fanatics was started in 2011 and has become a known name in sports merchandising and e-commerce, valued at $31 billion.

*MLB ICON Leadoff NFT Collectibles, launched by Candy Digital in Apr. 2022 Source: MLB*

However, the crypto bear market has hit the NFT sector hard in 2022, and Rubin’s firm is seemingly now looking to turn away from “standalone” NFT businesses.

The investor group led by Novogratz’s Galaxy Digital will be purchasing the stake in Candy Digital, according to CNBC. In an email shared with the outlet, Rubin wrote:

“Over the past year, it has become clear that NFTs are unlikely to be sustainable or profitable as a standalone business.”

He stated that divesting ownership in Candy Digital “allowed us to ensure investors were able to recoup most of their investment via cash or additional shares in Fanatics.”

This was a favorable outcome for investors “especially in an imploding NFT market that has seen precipitous drops in both transaction volumes and prices for standalone NFTs,” he added. NFTs alone would not create much value, according to Rubin, who said:

“We believe digital products will have more value and utility when connected to physical collectibles to create the best experience for collectors.”

Fanatics acquired Topps trading cards for roughly $500 million in Jan. 2022. Furthermore, it acquired the rights to produce Major League Baseball trading cards and then NFTs following the launch of Candy Digital last year.

Fanatics raised $700 million in fresh capital in Dec. 2022. The funding will be used on potential merger and acquisition opportunities across its collectibles, sports betting, and gaming businesses, according to CNBC.

Candy Digital secured $100 million in funding in Oct. 2021 with a valuation of $1.5 billion at the time.

However, the NFT markets have shrunk considerably during the 2022 crypto winter. According to the Nonfungible.com market tracker, daily sales volumes have slumped from over 100,000 sales in January 2022 to around 15,000 today.

Cointelegraph reached out for comment from Fanatics and Candy Digital but had not received a reply at the time of publication.

Report: NFT Firm Candy Digital Cuts Over a Third of the Company’s Staff

November 29, 2022 Bitcoin.com

Nifty News: China’s lockdown protest NFTs emerge, Candy Digital cuts staff, and more

November 29, 2022 Coin Telegraph

BAYC

Two collections have appeared on NFT marketplace OpenSea depicting images and art related to the rare widespread protests in China over its lockdown policies.

China’s COVID-19 protests cemented as NFTs

Nonfungible tokens (NFTs) depicting the ongoing protests in China against the country’s tough zero-tolerance COVID-19 policy have found their way to the NFT marketplace OpenSea.

At least two collections have been created in November, the first is a Polygon (MATIC)-based collection called “Silent Speech” featuring 135 NFTs depicting images of protesters, signage, graffiti and even social media screenshots related to the ongoing protests up for auction starting at 0.01 Ether (ETH), or just under $11.50.

*A Silent Speech NFT titled “Beihang University” (translated) shows an image of multiple tealight candles within surgical masks. Candles are an often used symbol of remembrance.*

Another collection titled “Blank Paper Movement” of 36 Ethereum-based NFTs with a floor price of 10 ETH, or nearly $11,800, features a more artistic take as the images of the protests appears to be painted.

Holding a blank sheet of paper has emerged as a symbol representing the suppression of speech in the rare and widespread protests which have flared up across China since Nov. 14, starting with residents of Guangzhou, one of China’s biggest cities, tearing down police barricades in response to COVID-19 related measures.

Demonstrators in Beijing hold blank pieces of paper in a rally against the communist government.
This idea developed during a student movement by a group of high school students in HK. pic.twitter.com/jRmnQ50Mlz
— 鄉港 (@sabaocean) November 28, 2022

The protests intensified on Nov. 24 as a fire that day in a high-rise building in the northeastern city of Urumqi killed 10 people.

Some Chinese internet users believe residents weren’t able to escape due to extreme lockdown measures which have included authorities wiring or welding doors shut.

Candy Digital lays off 100 staff

NFT company Candy Digital has reportedly laid off a sizeable portion of its workforce amid turbulent crypto market conditions and a massive dip in NFT trading volumes this year.

More than one-third of the company’s roughly 100 employees were cut according to a Nov. 28 report from the sports industry outlet Sportico.

It’s unclear the reason for the layoffs and if any particular departments were affected as Candy Digital has not publicly addressed the layoffs. The former community content manager at Candy Digital, Matthew Muntner, in a Nov. 28 Twitter post publicly confirmed he was part of the staff cuts:

I hate that I have to share this as much as I loved my job at @CandyDigital but I was part of the layoffs that occurred earlier today.

I am quickly looking for a new role in Community Management, Graphic Design, or related Marketing.

Thanks, Candy Fam for one hell of a ride ❤️
— Muntner (@muntnerdesigns) November 28, 2022

Cointelegraph contacted Candy Digital for comment but did not receive an immediate response.

Candy Digital was launched in June 2021, backed by sports e-commerce store Fanatics, crypto-friendly entrepreneur Gary Vaynerchuk and Galaxy Digital CEO Mike Novogratz.

The company quickly gained partnerships with sports leagues including Major League Baseball, NASCAR’s collaborative Race Team Alliance, and several college athletes. It was valued at $1.5 billion in Oct. 2021 following a $100 million funding round.

Candy Digital’s layoffs follow others across technology firms such as NFT protocol Metaplex’s Nov. 17 cuts of “several members” of its team, Meta’s Nov. 9 layoff of 11,000 employees, and Flow blockchain developer Dapper Labs’ Nov. 2 layoffs of roughly 130 employees.

Bored & Hungry restaurant runs pop-up at Phillippine blockchain week

The Long Beach-based NFT-themed burger restaurant Bored & Hungry has set up a pop-up shop at the Philippine Blockchain Week which kicked off on Nov. 28 local time.

It’s the first time the restaurant has operated in South East Asia, the brand also operated a pop-up french fry stand at NFT.London in early November.

Grilling in Manila for 3 days only!

Home of the Trill Burger, America’s best burger of 2022: @BorednHungry is bringing their apes and burgers to Manila! pic.twitter.com/RuDBy6Ykjg
— Philippine Blockchain week (@philblockchain) November 27, 2022

The restaurant first opened in April and is themed using the owner's intellectual property of his owned Bored Ape Yacht Club and Mutant Ape Yacht club NFTs and accepted ETH and ApeCoin (APE) as payment.

Around two months after its opening, in June, the store inexplicably stopped accepting cryptocurrency as a form of payment, likely due to the drop in crypto prices.

Ripple’s XRP Ledger hits new record NFT sale

Ripple’s XRP Ledger blockchain has recorded a new record NFT sale, with an XPUNK NFT — a clone of the popular Ethereum-native CryptoPunk NFTs — selling for 108,900 XRP (XRP), about $44,000 at the time of sale on Nov. 25.

The #XRPL has a new record! An @XRPLPUNKS NFT just got sold for 108900 $XRP (44000 USD).
This is just the beginning for #NFTonXRP.
— onXRP.com (@onXRPdotcom) November 25, 2022

The sale was a result of an open auction with over 20 people in a Discord voice chat according to the XPUNKS official Twitter account. It refused to disclose the purchaser but said “the community knows who it is.”

The XRP Ledger introduced NFTs on Oct. 31 with the introduction of the XLS-20 standard that was first proposed on May 25, 2021, the NFTs feature “automatic royalties” for creators.

More Nifty News

The community-led decentralized autonomous organization (DAO) made up of ApeCoin holders launched its own NFT marketplace on Nov. 24 featuring only Yuga Labs-backed collections.

Following the surprise win of the Saudi Arabian soccer team at the FIFA World Cup over Argentina on Nov. 22, the floor price of a Saudi Arabian-themed NFT collection unrelated to the team jumped by 52.6% with some appearing to view the tokens as an indirect way to bet on the success of soccer teams.