In August, digital marketplace OpenSea recorded over $3.4 billion in transactions across 1.67 million non-fungible tokens (NFTs). In July, its sales reached $325 million, following less than $150 million in June. The exponential growth corresponds to a shift in NFT content being auctioned, which may impact the development of digital strategies by brands and sports entities.
Until a few weeks ago, most digital assets being traded on OpenSea related to sports, digital art, and in-game assets. Some of the in-game NFTs and digital art content was produced in partnership with brands.
Now, the makeup of transactions is mostly composed of avatar-like NFTs hoping to emulate CryptoPunks, so-called ‘generative art’ created by algorithms, and Loot.
The easiest way to describe Loot is with the picture above. Each NFT is a text-based list or ‘bag’ of in-game objects, but currently, those objects aren’t associated with any particular game. The NFT is more than a nod to the old text-based games like Dungeons and Dragons. Loot only launched at the end of August and is the top selling NFT in the last seven days with $210 million in sales, according to CryptoSlam. It’s as much a social network as an NFT and seems to be developing a cult community following.
The current overall sales trends show NFTs becoming more niche and crypto community focused, at least for now. Perhaps there are some parallels with GameStop and other meme stocks where grassroots fans pumped stock prices which didn’t make sense to some observers.
An NFT of a sports star can engage a considerable audience. However, Loot and lesser known digital avatars attract a much smaller and, for now, niche community.
That said, the popularity of digital avatars could be the start of a digital collectible trend. While only one digital avatar is shown in the top four places in the image above, the remaining six of the top ten last week were all digital avatar collections.
Meanwhile, many brands and platforms have been working towards taking NFTs mainstream over the last couple of months. Bacardí will run an auction to promote its new rum brand through its own NFT storefront, Japanese sports sponsor Rakuten will launch a digital asset platform, and Facebook seems to be looking into NFTs as well.
