LogFAQs > #961470597

There is a lot to say about NFTs, and there are a lot of different "sectors" within NFT spaces and they are not remotely created equally.

It stands to reason that if you haven't come to terms with the existence of cryptocurrency in general that you don't belong in the NFT conversation. Before you can even weigh in on NFTs you need a general understanding of crypto.

But assuming you have cleared that very low bar, there are still a lot of different areas with incredibly varying degrees of viability.

In my opinion the least viable NFT sub section on average is the PFP projects. These are the projects that often consist of 10,000 randomly generated Profile Picture images and are themed in some way. Unless you were one of the very first iterations (CryptoPunks) or one of the early "high quality" PFP projects to gain name recognition (Bored Ape Yacht Club) the simple fact is that there cannot possibly be enough demand to drive value to the sheer number of projects that exist. Throw in the fact that 99% of new PFP projects are low quality cash grabs and you have a sector where very few of the projects will every be able to find and sustain traction. These projects tend to profit the few at the cost of the many and generally prey on over eager people who are trying to find the "next" crypto punk and get in on the ground floor. But people are going to keep making them because with next to no investment even a "failure" of a PFP project that has almost no adoption and quickly becomes value-less will net it's creators tens of thousands of dollars. And projects where the entire 10k images get minted can land it's creators hundreds of thousands.

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And in my opinion the most viable NFT sub section is collectibles, sports in particular. Sports cards, for example are an example of an asset whose value has stood the test of time. It is only the extrinsic value that we apply that causes a sports card to be worth more than the cardboard it's printed on. Whose card is it? When was it made? Was it the first card available for that player? How many of that card are in circulation? These contribute to the value of a sports card. And with the exception of "what condition is it in?" all of the extrinsic value questions for sports cards can be successfully applied to sports NFTs. Not only that, thanks to the blockchain forgery becomes impossible unlike the Pokemon Cards that Logan paul paid 3.5M for which may actually be fake. (still waiting for more information about that emerging story).

Within sports NFTs though, there are several varied examples of them being implemented. You have NBA Top Shot, which creates NFTs out of highlights from NBA games. This is a good use of the digital nature of the blockchain to create a sports asset that's more than just a static image. And sure anyone can look at the same 10 second clip that you "own", but in that same way anyone can pull up the same exact picture of mickey mantle that was used for his baseball card. The series 1 release of Top Shot has held it's value very well and I see no indication that moments from that first set will be losing value any time soon. One thing that Top Shot is not doing as well though (in my opinion) is that they seem to have oversaturated their newest sets. I understand the reasoning that they want to make their marketplace as accessible as possible and $2 is a very attractive entry point to own an NFT, but there really doesn't need to be 60,000 copies of a Bradley Beal layup:
https://nbatopshot.com/listings/p2p/e7b9646c-9997-46c8-909f-2a2b67389023+a6de2694-3f4a-4767-9679-7697b538f6d3

The other thing they do that I'm not overly fond of is gating all the new releases behind "collection score" requirements. Many of the better releases of packs require a high enough collection score which just creates a rich-get-richer aspect to their marketplace. But overall NBA Top Shots is the Official implementation of NBA digital assets and that officialness gives value to these assets.

In contrast you have Topps which badly mismanaged the release of their own sports NFTs. Their NFT drops tended to simply be static images that were identical to the physical cards that they created and their support/communication for those releases has been decidedly poor. Topps got bought out by Fanatics yesterday and Fanatics already has it's own NFT Company (Candy Digital) so it remains to be seen what will happen with the existing MLB Topps NFTs. But I am incredibly bullish on Candy Digital NFTs and have been for some time. They are the future of MLB Digital Assets, they released some Play-of-the-Day NFTs starting with the most recent playoffs (example: https://mlb.candy.com/collectibles/afbc105a-2a07-4a2a-be86-a4da4eaae9e8 ) and released a collection of NFTs that walk the line between being a card and being a video called their MLB Icons set. (example of an Epic: https://mlb.candy.com/collectibles/da59b000-0336-4906-9f3e-12aa21a00b57 and example of a Common https://mlb.candy.com/collectibles/e39dae68-ded5-407d-a1d4-c6d1e8e3adc8 ) Candy's own marketplace for these assets is launching on January 15th and I'm personally very excited for it.