Ryan Carson, COO of PROOF Collective, has warned that booming tokens may crash this year.
The world of non-fungible tokens (NFTs) has become a multi-billion dollar industry in recent months, thanks to the adherence of artists and celebrities and play-to-earn games. However, one crypto specialist believes that the market could crash and drive NFTs into a massive crash, just as it did with initial cryptocurrency offerings (ICOs) in 2019.
On February 22, the expert asserted on Twitter that, “We’re going to see a massive NFT crash like the 2019 ICO crash. I predict it’ll happen 6 months after @Coinbase_NFT launches.”
Platforms such as OpenSea, LooksRare, Axie Infinity, and others, have reached multi-billion dollar trading milestones. In any case, for Ryan Carson, director of operations at PROOF Collective -a podcast specializing in NFT-, that would not prevent an abrupt drop in their economies from occurring in the next six months.
“Fast-turn 10k PFPs, derivatives, and WolfGame copies will go dark because all Coinbase credit card buyers will lose 100% of their ETH,” Carson wrote when opening a thread on his Twitter account.
Carson’s Predictions
According to Carson, the growth of the NFT world will lead to leverage in the sector, but the most sophisticated investors will inject capital only in the best projects. That will lead to “NFT fractionation” and ultimately the best and most expensive will survive.
The specialist also remarked that private institutions and Decentralized Autonomous Organizations (DAO), especially those with reserves of more than 100 million dollars, would not do so badly, but would instead double their income. He also noted that “high-profile players” would strengthen their commitment to metaverse projects like The Sandbox and Decentraland, which already have significant reputations.
SAND price is currently testing some crucial phases or support levels where a bounce to higher levels is the need of the hour. However, after struggling for some time, the bears, who can drag the price to the lower support near $1.5, are the ones dominating the asset. Therefore, instead of quickly bouncing, the price may consolidate along support levels to gain some strength.
Decentraland price, in contrast, has been in a strong downtrend since mid-February 2022. In addition, the very recent attempt to change the downtrend has been in vain, as the price negated the uptrend, clipped, and revisited lower support. Currently, MANA price has attempted a notable turnaround from the lower support at $2.4 and is heading towards one of the important resistances at $2.8, which may offer interim relief from the downtrend.
Carson ended by sending an encouraging message to the crypto community. According to the expert, the NFT world will be able to grow only if the players do not go around chasing “quick-flip get-rich schemes.”
Unsustainable P2E Economies
Play-to-win NFT games have become all the rage. However, nothing lasts forever, and the bear market reveals all the shortcomings and viability of a project that does not necessarily have real-world demand.
The 2020-2021 bull market has in fact increased the demand for NFTs and tokens in the game. This paved the way for lucrative opportunities for gamers and spawned an entirely new economy – from just a passive hobby to a multibillion-dollar industry.
However, Jason Choi, general partner at Spartan Capital, believes P2E games will become less profitable than they are today in the absence of a bull market. He added that, “If the financial proposition of P2E games starts to wane, it should make up for that by having fun parity with popular Web 2 games, especially if they are to command unicorn ratings.”
Praising Axie Infinity’s strategy for gameplay first and economy second, Choi added that the current model for guild-run scholarships, fervor for DAO tools, marginally enhanced versions of DeFi holders, and tier 1 no treasury massive may not last.
By Audy Castaneda
