Anticipation of utilities >> Utilities ?
Currently, NFT’s collections gain value from the anticipation of utilities rather than utilities themselves. [1]
“Buy it now low, it will have astonishing use cases later, so you will be able to resell it with a premium” is basically the narrative this space has been following for the past months.
This made people buy RTFKT NFTs [2] after Nike acquired the team, for example.
The issue is that it leads people to mostly gravitate toward buying the story rather than the product - creating a massive spread between the price (floor) and the value (utilities) of a collection.
And inevitably, it changes the essence of our industry, making it more similar to the betting industry rather than online emancipation - the initial promise.
This momentum made builders more incentivized to hype their community with a good-looking roadmap and some frequent free money airdrops rather than focusing on actual use cases, and Goblin Town [3] - by reversing those codes - is the epitome of this trend.
When the project was released, the team behind it was unknown, the collection was obviously a troll and they expressively assumed the lack of utilities of their NFTs.
Results? the collection went viral on Twitter, the floor skyrocketed until the team got doxxed at the beginning of June and this chart from Opensea clearly highlights it.
Builders seem to have this inner voice saying "don’t produce anything because it might fail, just claim that you will probably do it later or stay silent, it’s safer and more profitable."
How could an industry shine with such a negative motto?
STOP DANCING
Milan Kundera, in Slowness (1995), developed a theory about those people who “don’t desire power but glory; they don’t desire to impose this or that social organization on the world but to occupy the stage to make their selves shine” and he called them “dancers”.
Dancers can’t lose face in public. It feels so horrible for them that they would prefer to do nothing to risk a bad situation where there’s a tiny probability of them failing and make an idiot of themselves.
It seems that most NFT builders are actually dancers.
They keep traders excited by constantly making them anticipate the next not-even-being-built hot trend and being short-term oriented, whereas they should be focused on creating useful NFTs to make our industry pass a milestone. [4]
NFTs have the power to reshape the world by truly achieving this digital transformation people have been seeking for years now. Indeed, as Kaiko's research department says, "the real digital transformation is not about apps and fancy front end. It’s about any asset and any transaction having a digital representation on the ledger to automate processes". And NFTs are in pole positon to make this happen.
Builders should stop dancing, and as Milan Kundera highlighted in his brilliant novel: the more a dancer dances, the harder his fall will feel. Because yes, the destiny of a dancer is to fail, like every other human being. With their attitude, they will finally only postpone this moment, making success less likely to come.
Indeed, let’s get the bigger philosophical picture:
Movement is only a succession of immobilities. Time is only a sequence of moments. Matter is nothing but a mass of emptiness.
These fundamental concepts are almost exclusively composed of their inverse, their opposite, their negation.
Why then do we find it so difficult to accept that success is only a succession of failures?
Doing nothing will never lead to failure, but paralysis. And it’s actually the word that better describes NFT space, as this chart proves.
NFT volume has been absolutely stagnating on opensea for the last 3 months - and this mainly because of the lack of long-term ambition from builders and despondency from traders.
Conclusion
Nothing meaningful will emerge by constantly repeating the same pattern - create pointless NFTs, and stimulate volume by being mysterious rather than useful. NFTs will succeed when their creators actually adopt the correct behavior to achieve success: test, fail and repeat by adjusting their strategy. Shivsak Huja just released a brilliant thread [5] summing up what an NFT can do: it should be a civic duty to read it!
SOURCES
[1]: Tweet
[2]: Nike x RTFKT
[3]: GoblinTown