Is it a good time to buy nonfungible tokens? Expert answers
As the floor prices of popular nonfungible token (NFT) collections took a nosedive along with the broader crypto market, an NFT expert believes that this is a good opportunity for investors within the space.
In a Cointelegraph interview, Ahren Posthumus, the CEO of NFT marketplace Momint, shared his thoughts on compelling NFT use cases, its role in contributing to climate action and what NFT investors should focus on during the current bear market.
Posthumus believes that fractionalization of bigger assets may be the next big thing for NFTs. Citing the stock market as an example, the executive believes that breaking apart expensive assets into smaller and more affordable parts will make assets more interesting to retail investors. “This is what the stock market did for investing in companies, and it was wildly successful,” he said. The executive explained that:
“Perhaps the blockchain application with the greatest potential for future utility is fractionalized ownership of assets, sometimes called tokenization, which the general public has never had access to before.”
Apart from this, the NFT expert also highlighted that NFTs could contribute to climate action and positively affect efforts to address environmental concerns. While NFTs are often associated with artworks, the Momint CEO underscored that they are digital certificates of authenticity. This makes it an optimal medium for carbon credits. Additionally, Posthumus explained that:
“You can launch NFT projects that are specifically designed to raise funds for environmental initiatives. This way, you can leverage the hype of NFTs to generate funds and awareness for environmental causes.”
When asked if it’s a good idea to buy NFTs during an ongoing crypto winter, the executive answered “yes” but urged investors to check the underlying value and the fundamentals of the assets before investing.
Lastly, as the world experiences a recession, the executive said that it would be a safer bet to invest in blockchain infrastructures like Ethereum. “Some blockchain applications will emerge triumphant, but many will fade into obscurity,” Posthumus said.
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In the first half of 2022, NFT investors have spent 963,227 Ether (ETH), worth around $2.7 billion, in minting NFTs in the Ethereum blockchain alone, according to a report from data firm Nansen. Other blockchains like the BNB Chain (BNB) had $107 million worth of NFT mints while Avalanche (AVAX) had $77 million.
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