- The current NFT bubble is bigger in scale than the previous one
- Profiteering is even more evident this time round and is reminiscent of pump and dumps in the past
- When the NFT bubble pops there will be people left with images of rocks that cost the same as a mansion
The current NFT bubble is bigger than almost anyone could have predicted, especially considering how large the last one got, but this one doesn’t even have the veneer of collectorship about it. It has very quickly turned into a game of pass the profit, with Bored Apes, Ether Rocks, CryptoPunks and the rest of them changing hands for ever more extreme fees, but the whole thing is a ticking time bomb that will explode at some point, and when it does it is going to leave some very disappointed profiteers in its wake.
Current NFT Bubble is a Different Beast
The first NFT bubble shocked many both in the space and outside of it, mainly because it was so unexpected, not just in its nature but in the valuations being reached. Despite that first NFT bubble popping however the space has only grown bigger, with new ranges coming out seemingly every week, and early offerings being snapped up purely with the expectation of massive profits. This isn’t taking into account the ease with which anyone can now mint their own NFTs. This is different from the prior NFT bubble when the market was smaller and it was harder to mint your own.
Many predicted that the market had topped when an EtherRock sold for $1.3 million a few days ago, but this seems premature – the ‘floor’ for pieces within the Bored Apes Yacht Club has almost reached 40 ETH ($124,000), and there are 10,000 in the collection. Crypto Twitter is full of big accounts buying up such NFTs on an almost daily basis in the hope that they can get out before the NFT bubble bursts.
When Will it Pop?
So when will the NFT bubble burst? It’s hard to tell, but the first one popped pretty quickly. However, this time round the scale is bigger and the opportunities more plentiful. Given this expanded market there’s no reason to think that it won’t extend to the end of the year, or maybe through the rest of the bull market, but the end could come much quicker if prices continue to rise as quickly as they have been. There are only so many times a picture of a rock can be resold for profit, and when you’re talking $1 million plus the whole thing comes down to a game of pass the parcel.
The only difference is the person holding the parcel at the end will have forked over the cost of a mansion for it.