Cointelegraph Research report: NFT sales are expected to reach $17.7 billion in 2022

2021 will be a breakthrough year for NFTs, but what drives such an impressive performance? This Cointelegraph research report has the answer.

In 2010, would you believe it if someone told you that virtual emojis, digital artwork and Twitter avatars would sell for hundreds of thousands of dollars?

Well, in short, these are non-fungible tokens (NFTs). Backed by cute kittens and pixelated avatars, NFTs are pushing blockchain into uncharted territory. What appears to be speculation on meaningless collectibles is actually the unpredictable future of fintech innovation. NFTs represent a turning point. Blockchain technology is now being used to represent off-chain assets.

To understand the burgeoning and intriguing development of NFTs, the Cointelegraph research team delved into this new field, presenting the findings in their latest report, Non-Fungible Tokens: A New Frontier.

This report covers the history and development of NFTs, how NFTs are stored, traded and exchanged, how to mint NFTs and what platforms to choose, how the NFT market works and how prices are formed, how to find exciting new NFT projects, how NFTs are used in various jurisdictions How jurisdictions are regulated, how much energy is used in creating and trading NFTs, and what the future holds for this emerging market.

Birth of NFTs

Bitcoin pioneer Hal Finney first mentioned early versions of NFTs in 1993. He calls them "cryptocurrency trading cards." In a forum discussion, Finney talked about definable scarcity, exclusive ownership and provenance. These concepts are now at the heart of NFTs.

The idea of NFTs didn’t take off much until 2012, when Yoni Assia wrote Colored Bitcoins, which eventually became Colored Coins. Colored coins build on the Bitcoin blockchain to create semi-fungible tokens that are supposed to represent real-world assets such as real estate, commodities, and bonds.

One of the earliest iterations of NFTs, "Quantum," was created in 2014 by Kevin McCoy and Anil Dash and is on display at the New Museum in New York City. In 2015, the first Ethereum-based NFT called Etheria was launched at Devcon 1. This is largely considered to be the first real NFT.

The term "NFT" was coined in 2017. Although little known at the time, two very important NFT projects, CryptoPunks and CryptoKitties, launched in 2017. In the same year, the first NFT property was sold through Propy. This marks the first wave of NFT popularity, in sync with the cryptocurrency market cycle.

market development

NFTs have become a booming market, expanding year by year. For example, sales have grown from just $41 million in 2018 to a staggering $2.5 billion in the first half of 2021, a 60-fold increase in three and a half years.

Even compared to 2020, the growth is phenomenal. Total sales in 2020 reached $340 million, and so far in 2021, sales have surpassed $9 billion, an increase of more than 25 times, according to NonFungible.com data on Ethereum NFTs.