The founding father of the ‘digital silver’ drew parallels of the booming NFTs market to the notorious ICO market of late-2017.
Lee on NFTs
Litecoin founder Charlie Lee is not any huge fan of non-fungible tokens (NFTs), the booming crypto subsector which noticed muted development within the earlier however exploded to its present $3.44 billion valuation prior to now months.
Lee took to Twitter to elucidate why he wasn’t a fan. “I see a number of parallels between 2021’s NFTs with 2017’s ICOs and 2013’s altcoins,” he stated.
“Few will maintain and have worth, most received’t,” stated Lee, drawing parallels between NFTs and ICOs.
NFT noticed a growth in late-2020 that carried over to 2021. These are, for the uninitiated, a cryptographic illustration of tangible and non-tangible objects (resembling actual property, digital artwork, music, amongst different issues), that show possession of the rights of no matter is represented.
I see a number of parallels between 2021’s NFTs with 2017’s ICOs and 2013’s altcoins:
– simple to create new ones with no limitations
– easy to grasp & clarify
– brings tons of recent folks into crypto
– excessive costs & pumps create hype/FOMO
– few will maintain & have worth, most will not
— Charlie Lee [LTC⚡] (@SatoshiLite) March 2, 2021
The submarket of NFTs has gone ballistic prior to now months. The sector’s whole worth was underneath $300 million in 2019, grew to over $1 billion in 2020, to its present $3.4 billion. Buying and selling volumes of NFTs have expanded too.
As per Dappradar, the common quantity was underneath $30,000 in March 2020, whereas as we speak, it reaches tens of hundreds of thousands in a single day alone. The NFTs are going underneath the hammer for enormous quantities too. A number of platforms, resembling CryptoPunks, basketball-branded NBA High Pictures, and OpenSea, have seen gross sales of $1 million per NFT in 2021—a transfer that has attracted criticism from a number of quarters.
For crypto proponents like Lee, the sudden development of NFTs is just like ICOs. In his tweet yesterday, he listed a few of these similarities: [that they are] simple to create new ones with no limitations, easy to grasp & clarify, brings tons of recent folks into crypto, excessive costs & pumps create hype/FOMO.
The alarm bells are seemingly not unfounded both. “DeFi Ted,” an nameless crypto investor and advisor to insurance coverage challenge Cover Protocol, shared his experiences with NBA High Pictures in a tweet yesterday, explaining his current ordeal with the agency’s withdrawal course of.
Right here is the total break down of my expertise with Dapper labs.
— DeFi Ted (Bakes) (@DeFi_Ted) March 2, 2021
He alleged that High Pictures didn’t reply to withdrawal requests, a degree that made DeFi Ted query the challenge’s solvency.
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