The NFT market may be in for a scary price bubble busting
Last week's Otherdeed metaverse land sale enjoyed a solid boom, with so many users rushing to buy the virtual metaverse real estate plots that Bored Ape creator Yuga Labs was minting that the entire Ethereum blockchain became temporarily unusable.
The network charges "gas" fees, or service fees, based on how many users are active, and this week, Fortune reported that investors paid at least $5,800 per NFT land plot and up to $6,000 in gas fees for a total of about 4.21 Ether at current prices.
Unfortunately the gamble may not pay off. According to the finance outlet, those same investors would lose about $1,700 per sale if they put their "real estate" on the market approximately a week after the drop, with prices hovering close to 3.6 Ether on OpenSea and down an eyewatering 37 percent on Decentraland.
If there's one universal rule that we're pretty sure is still true, it's gravity. What goes up must come down. Investors are already predicting the US housing market bubble might soon bust, meaning you won't always see knock-down drag-out fights over buying a house, with buyers still losing a sale because somebody else offered an extra $50,000 in cash. And that's without getting into the stock market.
The crypto market is volatile, sure, with booms and busts happening more or less constantly. But it's still an investment class that even billionaire Warren Buffet won't touch with a five-foot pole, despite holding physical real estate.
Will prices of NFTs recover? It's certainly possible in the short to medium term, but the real question is whether any of these assets will hold any value in the long term.
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