NFT market held back by oversupply, greed and bad projects: Gary Vee

Popular entrepreneur and NFT supporter Gary Vaynerchuck – also known as Gary Vee – has argued that oversupply, greed and substandard projects are the main reasons why the NFT market has hit so hard. dropped over the past year.

On December 12, Vaynerchuck featured his latest blog Publish via Twitter which explores current issues in the NFT industry and where it thinks it is heading next year.

Commenting on the state of the market, Vaynerchuck pointed out that there had been a significant amount of fear, uncertainty and doubt (FUD) this year from the media and social media users, who generally highlighted highlights issues such as decline in trading volumes and floor prices.

“The truth is, if you’ve been paying attention, you know what’s really going on here — and if you’re anything like me, you’re not surprised,” Vaynerchuck explained.

He recalled a prediction he made a year earlier in which he claimed that “98-99% of NFT projects” that gained traction during the NFT boom in 2021 will end up being bad investments or “falling to zero. “.

Problems with NFTs

Explaining this prediction, Vaynerchuck pointed to three major issues that are holding the market back: oversupply, short-term greed, and mediocre traders.

In terms of oversupply, Vaynerchuck argued that the large number of “celebrities, influencers, sports leagues, big brands and individual artists” who jumped on the bandwagon last year could only cause supply problems. and request.

“Some have been incredible projects led by real operators who are focused on creating value for their communities – most are not,” he wrote, adding that:

“Demand has not and will not be able to keep up with this extraordinary level of supply, and every time that happens there is a bubble waiting to burst.”

Regarding short-term greed, Vaynerchuck argued that the industry has been hampered by too many people rushing to make a quick buck by launching projects or trading NFTs, resulting in losses due to scams and imploding projects with poor fundamentals.

“Everyone is too selfish, too quick and lacking in thought. It’s a marathon, but everyone treats it like a micro-sprint and a gold rush, and that’s why most will lose,” he wrote.

In June, blockchain monitoring software company DEXterlab interrogates over 1,300 people on Twitter about their NFT shopping habits from late May to early June. He found that while 64.3% of his respondents said they bought NFTs “to make money”, less than 42% made a profit at the time of the ballot.

Meanwhile, on the subject of bad projects, he suggested that since anyone can just start an NFT project, “there are now a lot of people who have no real knowledge of things like business, building a long-term community, culture, daily functioning of a staff and creating demand.

Where are NFTs going in 2023?

Looking ahead to 2023, Vaynerchuck argued that there is unlikely to be another market boom like the one in 2021, especially since he doesn’t see the “macro landscape” turning bullish anytime soon. early.

Additionally, Vaynerchuck compared the crypto and NFT industry to the Internet boom of the late 1990s and early 2000s, in which countless companies collapsed while the strongest took over. above.

“Due to a ridiculous amount of supply, many projects will collapse and fall to zero like, but there will be some – that 1-3% of projects – that will become the Amazons and eBays . The key is… how many of you are willing to do the homework necessary to make smart investments? »

Vaynerchuck jumped into NFTs in early 2021 and launched his first VeeFriends project in May of that year, and has invested in several projects from. According Data from CryptoSlam, VeeFriends is the twentieth ranked NFT collection by all-time sales volume at $241.8 million.