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NFT trading surges 21,000% in 2021 - report

Kitco News

(Kitco News) As the crypto market enjoyed a stellar year in 2021, NFT trading soared in popularity as well, rising 21,000% to $17 billion, according to a report by Nonfungible.com.

"NFT [nonfungible token] was chosen Collins Dictionary's word of the year for 2021. Not bad for a term which, just 12 months ago, was only used by a handful of enthusiasts across the world," the NFT data company Nonfungible.com said in its annual report, which was released this week with the support of L'Atelier BNP Paribas.

Trading in NFTs reached $17.6 billion in 2021. In comparison, that total was just $82 million in 2020.

"At the end of 2021, we are up against a market that was more than ever subjected to excessive speculation, with new, with new inexperienced buyers and risk-taking increasingly less restrained. Throw into the mix an almost infinite proliferation of projects with relatively low added value, contributing to market saturation and raising suspicion about the real added value and potential of NFTs," the report said. "And yet… the ecosystem has never been so innovative and mature."

A quick background for those still not involved in the space, the Non-fungible tokens (NTFs) are tradable digital tokens that represent a unique asset.

The report explains: "NFTs can take the form of a digital work, a virtual land, a domain name, or even equipment in a video game. NFTs are simply a technological medium that allows any digital item to be stored and circulated virtually on a blockchain. To some extent, 'NFTs' can be compared with computer files in the sense that their type and usage can be extremely varied."

In terms of profit alone, investors ended up generating $5.4 billion via the sale of NFTs last year, the report added.

One of the most well-known NFT sales of 2021 was the popular NFT created by the artist Beeple that sold for $69 million at a Christie's auction in March of last year.

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