NFT technology has allowed for the creation of programmable digital goods that can be used in any way imaginable, and applied to a myriad of different virtual and physical ecosystems. Over the past year and a half, we have seen NFTs used in the following ways:
- Art/Collectibles
- Gaming
- Metaverses/Real Estate
- Domain Names/Digital Identity/Documentation
- Music/Entertainment
- Financial Positions/DeFi/Legal Positions
- Ticketing/Membership
The NFT bull market which peaked in 2021 was undoubtedly driven by the use of NFTs as art and collectibles, as this new concept of digital scarcity helped hype driven projects like Bored Ape Yacht Club reached a floor of over 100 ETH. Reality was bound to catch up to NFTs because there was really no meaningful utility that came with owning an NFT — new profile picture, merch drops, ponzi tokens, and parties can only go so far when NFTs are worth 5 to 6 figures each. Many NFT projects in the space also promised a ton of development to invite speculative investment and ownership of their NFT; however most development has fallen flat (e.g. on-chain gaming) and or not even materialized (e.g. club memberships to real life experiences).
Today, demand for NFTs has withered away, as users are no longer as willing to pay for NFTs — the free-mint meta is dominating and NFT floor prices have dropped over 50% for several blue chip projects. In addition, ownership rights over an NFT are not as clear cut because for some projects, owning the actual token does not grant full ownership and use rights of the intellectual property. All this to say is that NFT technology is becoming commoditized and the real value associated with an NFT is the brand and intellectual property backing it.
As demand and market size of NFTs shrunk, several NFT companies or protocols have downsized or closed down due to lack of demand for their products or services, legal challenges, or growing pains. For instance,
- Earlier this month, Snapchat shut down its web3 and NFT division and laying off 20% of its staff, citing NFT as “not a priority.”
- In July, the leading NFT marketplace OpenSea laid off 20% of its staff, citing “unprecedented combination of crypto winter and broad macroeconomic instability.”
- In March, F1 Delta Time, an Animoca Brand car racing game produced for Formula One where NFTs were sold for as much as $265,000 closed down, showing how unpredictable the NFT world really is.
- In February, the NFT marketplace that sold Twitter founder Jack Dorsey’s first Tweet for $3 million, Cent, shut down citing “rampant fakes” and plagiarism problems.
- Nova Launch, a leading NFT launchpad for the Solana ecosystem, shut down earlier this year due to lack of demand for new NFT launches after the crypto markets crashed.
- This week, the NFT renting platform Rentable recently shut down, citing close to “zero traction.”
Despite the negative outlook for the NFT ecosystem, the team at Vera Labs remain very bullish on NFTs in the long term. Why are we so confident? Let’s take a look at what we’ve accomplished the past year, what we’ve learned, and how we’ll continue our position as the leading NFT utility infrastructure in web3.
Our Accomplishments and Contributions
Since the start of 2021, the team at Vera Labs have been super busy building Vera, a multi-blockchain protocol that allows any NFT to have utilities in a trustless way such as conditional ownership. Services included peer-to-peer rentals and buy now pay later (i.e. mortgages) of NFTs with or without the need for collateral, enabled by Vera NFT Lien technology, in use cases such as metaverse/gaming, token gated events, or experience access.
Here are some highlights of our key contributions to the web3 space:
- Contributed to the development of the NFT Rental Standard ERC-4907 adopted by the Ethereum Foundation on June 28, 2022.
- Performed the world’s first trustless rental of a million dollar plus NFT — Bored Ape Yacht Club #65 on Ethereum mainnet, making web3 history.
- Became the exclusive technology provider powering Polygon’s #1 “phygital” social metaverse Totem with over 100,000 members, and previously helped them raise over $2 million dollars by launching their Vera-powered XOiDs NFT collection and grew an active community of over 8000 members around the NFT.
- Performed over $2 million in NFTs rentals to date with mainnets launched on Ethereum, Polygon, BSC, and recently, Solana
- Recently launched VeraDAO to ensure the governance of fundamental NFTs utilities remain decentralized.
- Built a community of over 140,000 followers across our socials, which continues to grow despite the bear market.
Our team is proud to have the backing of hundreds of thousands from around the world as we work to innovate and increase NFT adoption through our ecosystem. Vera was built by the community for the community and we will remain true to our vision. Non-collateralized peer-to-peer rentals and buy now pay later are just the beginning of what our team has in store to make NFTs easier to use and more liquid, while attracting new business usage and innovation.
What We’ve Learned and How to #WAGMI
Our experiences this past year have taught us a few crucial lessons:
- NFT is a technology, not an “asset” or “asset class.” On the other hand, cryptocurrencies are “assets” or their own “asset class.”
- NFT assets such as game NFTs, Ponzi NFTs, art/collectible NFTs, membership/loyalty NFTs each have completely different business use cases, stakeholders, and valuation strategies. Therefore, a generalist approach to NFT marketplaces will have a high risk of low-product fit and failure. This is why Vera currently has no plans to be an “NFT launchpad or marketplace for ___________.”
- Even the web3 gaming or “GameFi” vertical is nascent, with leaders in the space such as Sandbox, Decentraland, Axie Infinity, Star Atlas , or StepN struggling to gain market share against their web2 competition, nor do they have a sustainable multi-token economic model capable of facing a crypto winter.
- DeFi and utilities for NFTs sound great in theory, but have no value if there is not sufficient NFT adoption and market size.
- A company or protocol for NFTs that depends on a crypto bull market to survive means low to no true market fit.
- In a global recession with high inflation and gas prices, decreasing retail spending, and God forbid, global war, consumers will increasingly refuse to spend money on non-essentials. Any company or protocol betting on a form of collectible NFTs are going to be in trouble or #NGMI.
Understanding the current market climate and risks, our team has devised a strategy and thesis to ensure Vera will remain recession-proof no matter how long crypto winter lasts:
- Don’t wait for NFT adoption. Create it.
- Make sure the demand we create for NFTs can be high, even during a global recession.
- Ensure these NFTs are easily usable by retail consumers, not just crypto-native degens.
- Better yet, make sure these NFTs are easily monetizable by their owners. I’m sure plenty of people are hurting in a recession and wouldn’t mind new streams of income.
In our next series of articles, we shall publicly release our strategy and news of our progress, which we have been building in stealth mode for the past several months!
Despite the current crypto winter, we are focused on our original mission and vision: “to increase the GDP of web3 and empower communities by allowing anyone to easily share and monetize their NFTs.”
The future of NFTs is decentralized, chain agnostic, and interoperable, and Vera will be a market leader to support the onboarding of the next billion users into web3 at scale, let alone allowing anyone to participate, monetize, and grow their web3 businesses at ease. #WAGMI!
About Vera
Founded in 2021, Vera Labs, the team behind Vera had a vision: To increase the GDP of web3 and empower communities by allowing anyone to easily share and monetize their NFTs. In other words, if Bitcoin is the new digital currency for electronic cash payments that replace the need for banks, then Vera coin is the new digital currency for electronic NFT payments and financial transactions that replace the need for broker and escrow intermediaries. Initially a protocol that enabled rentals and buy now pay later for NFTs, Vera today has become the leading infrastructure for utility NFTs which will fuel the upcoming web2.5 revolution. Vera’s technology is used by NFT-enabled applications of several world-class brands, games, and metaverses and supports the leading NFT blockchains such as Ethereum, Polygon, Binance Smart Chain, Solana, and ImmutableX.
Follow Vera:
📈 Buy $VERA coin
🌐 Visit us on our Website
📩 Email us at hello[at]vera[dot]financial
💬 Chat with us on Telegram — @veranfts
🐦 Find us on Twitter — @veranfts
🤖 Follow our work on Github — @veradefi
