NF T's have been taking over the art world and at the center of
the NF T craze is a company called open sea.
Look at open sea. That's the biggest NFT trading platform.
They saw sales top $1 billion in August. That was a record and
three times the July sales.
open sea remains one of the largest NFT platforms today with
over 1.5 million active users. January 2022 was open seas
biggest month yet. It recorded a monthly trading volume of $5
billion, surpassing its previous high in August 2021.
OPC does dominate and last year they were averaging about 90 95%
of the market. But with
its explosive growth. The platform has also received
backlash for outages, plagiarism, and even insider
trading scandals.
One of the top officials at the biggest in ft marketplace being
accused of insider trading on the platform.
In 2021 Crypto scammers took nearly $14 billion worth of
cryptocurrency. Crypto related crime also increased nearly 79%
from a year earlier.
Last year. 2021 was the biggest year on record for all for
criminal activity period, the end, you're always going to have
quite a bit of scammy activity.
Now the digital art market appears to be cooling off, and
regulators are paying more and more attention to the crypto
industry. So what's next for the world's largest NFT marketplace.
Open C is an online marketplace where users can create, buy and
sell NF TS founded in 2017. By two former software engineers
open sea was one of the first NFT marketplaces to tap into the
crypto craze. It's funded by the likes of Andreessen Horowitz
Coinbase ventures and blockchain capital,
beginning of summer of last year, their volumes were not
particularly large. So in 2020, the overall NFT volumes for
about $90 million and for the full year of 2021, shot up to
$25 billion. In total.
What started off as a small team soon grew to a team of 450
employees as user growth skyrocketed. The company had its
biggest month ever in January 2022. The same month venture
capitalists pour $300 million into the company that cost the
valuation of open sea to skyrocket. Those who are able to
get in early we're able to make a lot of money by selling their
nfts on open seat. 12 year olds Benjamin Ahmed launched his own
NFT collection called Weird whales on open sea in June 2021.
His collection earned him more than $400,000 After selling for
about two months,
right. Originally going into the NFT space I was never intending
so anything I just wanted to learn about smart contracts to
learn about NF T's to learn about this new space. And once I
started seeing that people were buying my collection, I was
really happy that people were willing to connect with my
story.
24 year old digital artists Alana de Nina also used open C
to list her first NFT artwork. It was sold for four eath which
at the time was valued at $13,700.
To time I didn't know anything about crypto blockchains live
tree so I had to make a lot of research to understand
everything about what three and then be able to understand NF
T's It's really amazing to be able to sell a digital file
online and to be able to gain money from it directly.
Open XE is one of the most popular NFT platforms today
among others, such as Lux For foundation, super rare and nifty
gateway. I
think with open see the comparison to eBay is justified.
They kind of have everything on there. It attracted the content
creators attracted the best collections. And I think the
formula for their success is just the user experience is good
by comparison.
Open C makes it easy for creators to collect royalties
when they list NF TS on its website. creators can charge up
to 10% for their listings, and gives them an option to list
their nfts at a fixed price or through a timed auction. Still,
there are competitors who are trying to take away open seas
market share in the NFT space and we can already
see in the numbers after looks fair launch their campaign at
the beginning of the year that the market share for open sea
has fallen
other competitors include Coinbase NFT, which already has
a waitlist that exceeds 3 million users signed up, and
RedBubble another NFT marketplace that was putting up
monthly trading volumes that were higher than its
counterpart. But competition isn't the only hurdle open sea
has to get through. In January 2022, open seas suffered a
database outage that meant new NFT owners were temporarily
unable to see their NFT artworks and their crypto wallets. There
have also been instances where an NF T artwork was minted
without the permission of the original owner open C also
admitted that at least 80% of NF T's created using its minting
tool were fraudulent
security and safety for the individual user is definitely on
their list of priority. So I would expect them to make more
announcements on that side of things. We don't want hacks and
we don't want security breaches. It's not good for business. It's
not good for the consumer.
Open see told CNBC that it prioritizes the trust and safety
of all people on open sea and are working hard to make sure
that creators buyers and sellers alike feel supported by our
policies, tools and services. The overall NFT market has also
seen an increase of scams in the past year.
We've been looking at market manipulation, wash trading, and
plagiarism and, and then your run of the mill phishing scam,
which is also something that has been coming into the NFT space
as well. Some ways that you can protect yourself are doing your
due diligence, looking for the source of the NFT that what
collection is actually verifying the contracts industry solutions
that are specific to tack are able to actually really help
protect people from being scammed.
Investment Bank, Jeffries estimates the NFT market could
reach more than $80 billion by 2025. The NFT market, however,
went through a volatile patch in recent weeks, the average
selling price of an NFT dropped below $2,000. In March, the
daily total sales Average fell to its lowest levels of $18.8
million on March 6, but shot back up to $65.4 million on
April 1. Still, when you zoom
out and you compare it to 2020. It's still tremendous growth.
And it can't be all, you know, one way forever, right?
As for open see, the company is rapidly hiring more experts in
the product development space to strengthen its platform against
the bad actors. So what's next for NF Ts?
I mean, I'm optimistic that NF T's are going to weed out some
of these issues related to plagiarism and fraud. And I
think it's probably probably here to stay I
100% on bullish on NF T's and I definitely think they'll grew as
95% of NF t use cases are waiting to be discovered. But I
think
also open sea and other platforms will be looking into
how they fit into the new virtual worlds that are being
created that companies are investing in it's part of a an
evolution of kind of having more of a presence in virtual worlds
and that means a virtual economy. And nfts will fit right
in and then I think people will want to express their identity
in the virtual world just like they do in the physical world.
Whether that's through fashion luxury items or sports goods or
gaming or beauty products. There's so many ways it could go