While NFTs have to date attracted attention thanks to their ability to generate enormous returns for artists and early investors, the bubble on this market has predictably burst. Trading volume is now a fraction of what it was during the NFT frenzy of 2021-22. Some 95% of all NFT collections are now virtually worthless, with only a few “blue chip” collections with strong brands or by more serious artists retaining some pricing power.
This does not mean that NFTs are dead, though. It just means that this emerging technology – which can function as an unquestionable proof of ownership for any number of things – will be utilized in new and very interesting ways.
Whether it’s reducing fees, removing middlemen, or enabling new revenue streams, NFTs promise to enable new models – not just for business, but for consumers too. As mainstream adoption grows thanks to improved user experiences, NFT utility will expand across numerous sectors; from events to communities to memberships and beyond.
Businesses are still just scratching the surface when it comes to implementing real-world use cases.
DeSci and DeDev
We will also hear a lot about the decentralized science (DeSci) and decentralized drug development (DeDev) communities next year. In the post-COVID period, a wider spectrum of stakeholders want to mobilize around pressing issues like disease cures and climate change. Yet traditional funding structures often restrict participation.
This is where DeSci and DeDev come in, both of which leverage decentralized networks and platforms to support open science and bring that research to market.
NFTs are a perfect vehicle to incentivize coordination while allowing community guidance of projects. Whether that be funding medicines in the public interest, the development of psychedelics for mental health, space exploration, or climate change, this sector is looking to mobilize the scientific community through decentralized technology.
NFTs serve as the vessels through which members of these groups can participate, engage, donate to treasuries, and cast their votes on important issues. This is a very important use case that will have broad implications.
At PharmaDAO, we are planning to use both the decentralized autonomous organization (DAO) structure and NFTs to fund the development of medicines in the public interest – that is, driving the work of bringing them through the legal, regulatory, and distribution hoops necessary to see real-world benefit.
Among these will be medicines in Phase 3 trials that often come up against significant barriers due to the cost vs. benefit equation of getting these drugs over the line. Many medicines with significant public health value are never brought to market because large pharma companies prioritize multibillion-dollar medications above all else.
A publicly-funded treasury could circumvent the sorts of concerns that stop small and midsize pharmaceutical companies from developing treatments that can help large numbers of people but don’t quite reach this mark.
Impact’s Back, Alright
As the world emerges from recent crises and economic uncertainty, people are regaining the capacity to focus on collective issues once more. As this happens, 2024 may usher in a new era of decentralized social impact projects.
This is because blockchain can counter many of the main objections to the social impact sector: that it is a bloated, self-serving industry concerned only with helping millionaires generate good PR and avoid taxes. The decentralized, transparent, and immutable nature of blockchain allows for totally transparent organization and funding – allowing anyone anywhere to see where money is going.
NFTs add a further layer of connectivity and personal investment to these efforts. Tokenized community membership creates feelings of ownership over outcomes – being part of the solution. Though speculative profit has been the primary appeal thus far, social impact attaching real utility to NFT ownership can shift this narrative.
Education
Few technologies rival NFTs’ potential to incentivize active participation within educational environments. Both traditional and digital classrooms stand to benefit enormously from tokenized models.
Implementing NFT-based rewards systems for children’s achievement unlocks powerful engagement triggers tied to verifiable digital ownership. Younger minds intrinsically attach deeper value to these digital trophies, coins, or badges compared to traditional grades or scores.
Additionally, NFT student IDs, profile pictures, and access tokens can streamline administrative tasks while adding an element of gamification. As education adopts immersive multimedia methods, NFT integration provides a skeleton key to securely navigate digital worlds, unlock lessons, and claim recognition for gathering knowledge.
Whether public schools or decentralized autonomous learning platforms, NFTs offer new ways to incent learning, evaluate competencies, and administer credentials. Unleashing creativity and competition around achievement, NFTs may emerge as a transformative driver for increasing accessibility and engagement in education.
Transparency
NFTs represent a watershed moment for provable digital property rights. By encoding unique identities on transparent blockchains, they guarantee immutable records of ownership not replicable by traditional means.
This affords NFT holders unmatched security, traceability, and control over their assets. Just as importantly, it also builds integrity and reliability for any process involving transfers – from ticketing to memberships and beyond. Counterfeiting and fraud could become non-issues.
As our world inevitably grows more digital, the need for embedded transparency and trustless verification underpinning transactions will only increase. NFTs deliver exactly that. Powering everything from decentralized organizations to creator economies, NFT functionality sits at the core of Web3’s premise – making virtual interactions and value exchange real.
We are still uncovering the multitude of problems NFTs solve and the possibilities they unlock across industries. But as more pioneers build ecosystems leveraging these dynamics, market opportunities will rapidly expand. NFTs are here to stay as a pivotal transparency technology redefining digital ownership and trade.
