Global NFT market will be worth $3.5trn in 2030 says research
Growth likely to come from deployment in supply chains and logistics, plus gains in gaming
The global NFT market is expected to increase to $3.5trn in 2030 as increasing demand for a decentralised marketplace is boosting market revenue growth, driven by the increasing use of non-fungible tokens in supply chain and logistics.
According to the latest analysis by Emergen Research, increasing use of NFTs in gaming is one of the major factors expected to continue to drive global market revenue growth, registering a CAGR of 39.6% over a 10-year period starting from 2020.
“NFTs prevent counterfeiting, assist in tracing the movement of products across the supply chain, and ensure originality,” said the analysts.
“NFT technology can apply to supply chains for high-end fashion businesses or providing information about materials and components for industries such as automotive. This could also aid in cost-cutting. NFTs could also be beneficial to enterprises concerned about tracking the usage of reusable and sustainable materials,” they added.
The metaverse
While NFT technology is expected to gain ground in the business and corporate sector, the metaverse’s growth is instead expected to be driven by gaming, one of the most popular applications for NFTs currently, alongside NFT art collections.
“Following the lead of blockchain-first game developers, traditional game developers such as Ubisoft are already experimenting with this technology. Decentraland, Sorare, Gods Unchained and My Crypto Heroes are among the most popular NFT-based games,” said the analysts.
According to the researchers, the coronavirus pandemic was a key factor in determining NFT popularity as individuals moved less when restrictions were imposed around the globe.
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“Because of global lockdowns caused by the Covid-19 pandemic, a number of individuals have adopted a more sedentary lifestyle and also to seek alternatives to maintain social connections due to prolonged periods of confinement and being deprived of interaction,” they said.
“As a result, many individuals engaged in various online metaverses platforms in order to increase social engagement and gain exposure for NFTs,” they added.
Where does the metaverse go?
As largely anticipated by Currency.com, Ethereum’s (ETH) NFT dominance fell from about 95% at the start of 2021 to nearer 80% at the beginning of 2022, as the Ether network is still coping with high transaction fees.
JP Morgan recently confirmed that Ether is losing ground to rivals such as Solana (SOL) and Cardano (ADA), due to sky-high transaction fees on the network.
The firm’s lead analyst Nikolaos Panigirtzoglou was widely quoted as saying: “It looks like, similar to DeFi apps, congestion and high gas fees has been inducing NFT applications to use other blockchains. If the loss of its NFT share starts looking more sustained in 2022, that would become a bigger problem for ethereum’s valuation.”
At the time of writing, the average transaction fee for Ether is ETH0.011 or $33.1 compared to Solana network offering a transaction fee of $0.00025 per transaction favoured by higher block time and block size.
