The NFT juggernaut has been rolling full-steam, and we believe there is no stopping it in 2022.
In this piece, we address some underlying themes that distinguish NFTs from traditional asset classes.
1. Target Demographic - NFTs trend younger as digital natives are more likely to be consumers than non-natives. This makes these assets skew closer to Gen-Z, although it has established some following among Millennials. Generation Alpha will be the most digitally integrated, and is likely to accelerate the adoption of such assets.
2. Pronounced Market Movements - Traditional asset classes are associated with longer hold periods for gains or losses to be outsized. In comparison, NFT project selection can, and has, led to outsized gains or losses in a very compressed time horizon. Attractive project pricing has, in many instances, captured the imagination of investors - the risk / reward outcome has seemed palatable to consumers across many new mints.
3. Exclusivity - There is charm and pride associated with owning a piece of work that is unique. Said another way, you own something that nobody else owns, and your ownership of the asset is publicly visible. There is not just ownership value, but also perception value associated with public ownership of an asset, should the asset turn out to be valuable over time.