In short
- The number of ERC-721 smart contracts focusing on NFT has reached a new record at Ethereum.
- At the same time, the NFT market still has a lot of room to grow, experts noted.
The total number of Ethereum ERC-721 smart contracts, which form the backbone of most non-fungible tokens (NFTs) on blockchain, reached a new historical record in the wake of the current NFT launch, according to CoinMetrics’ report published on Tuesday.
According to the report, the ERC-721 number smart contracts it recently reached a new historical record of around 19,000 as a result of the latest “NFT craze”.
ERC-721 is the Ethereum standard for creating NFTs, non-interchangeable tokens that are cryptographically unique. They were used to create digital items in short supply, including art, video game resources and music. In the past few months, the NFT space has expanded considerably, with trading volume in the top three NFT markets reaching $ 342 million in February alone, compared to $ 12 million in December 2020, according to DappRadar.
“The NFT market has gone from practically nonexistent to a thriving multi-million dollar decentralized market in just the past few months,” said analyst Mati Greenspan, founder of analytical cryptography company Quantum Economics. Decrypt.
However, despite the increase in sales volume, NFTs remain a relatively small slice of the Ethereum pie. ONEAlthough the number of ERC-721 contracts has increased to around 19,000, they are a “small fraction” of 17.84 million smart contracts currently deployed at Ethereum, the researchers pointed out.
First days, or a bubble waiting to burst?
Despite the fact that NFTs are much more expensive than other tokens on average, the relatively small number of ERC-721 contracts deployed – compared to the Ethereum ecosystem as a whole – suggests that the sector is still in its infancy in terms of mass adoption.
“Considering the growing public interest in NFTs and the growth of the metaverse market, NFT technology has great prospects for scale and evolution,” said Petr Kozyakov, co-founder and CBDO of the Mercuryo payment network. Decrypt.
He suggested that the NFT market could peak at $ 40 billion by the end of 2021. However, other experts have argued that the unprecedented prices paid by some collectors for NFTs have overinflated the market.
Konstantin Anissimov, executive director of CEX.IO crypto exchange, said Decrypt that the central deployment and use cases for all NFT technology have yet to be fully discovered, leveraged and integrated.
In the meantime, he argued, “there are clear indications that the NFT market is hyperinflated in terms of unprecedented valuations of some of the items sold so far, including the daily Beeple: THE FIRST 5000 DAYS, which sold for $ 69.3 million. ”Beeple himself is inclined to agree, having described the NFT space as “a bubble” in a recent interview.
“We will probably see a lot of ups and downs, but there is no doubt that this technology is here to stay,” concluded Greenspan.