NFT Bubble Burst: 95% NFTs, Digital Collectibles May Now Be Worthless

NFTs (Non Fungible Tokens) or Digital Collectibles was apparently a bubble which now has been burst to nothingness. A recent study looking at the price of thousands of collections seems to suggest that "NFTs are dead now!" .

A report by dappGambl based on data provided by NFT Scan and CoinMarketCap showed that out of 73,257 NFT collections the researchers looked at, 69,795 of them, or slightly over 95%, had a market cap of zero ether.

"NFTs had a bull run then crashed," said dappGambl report authored by Vlad Hategan, an NFT gaming specialist.

Of the 73,257 NFT collections dappGambl identified, an eye-watering 69,795 of them have a market cap of 0 Ether (ETH).

This statistic effectively means that 95% of people holding NFT collections are currently holding onto worthless investments. Going by the dappGambl's estimates, almost 23 million people hold these worthless assets.

Further, the dappGambl's study shows 79% of all NFT collections currently remain unsold, and the surplus of supply over demand has created a buyer's market that isn't doing anything to revive enthusiasm.

Even filtering out the lower-value, less significant projects, most collections have little value today.

Out of the top 8,850 collections by market cap, 18% are worthless, and 41% are priced at $5-$100. Fewer than 1% have a price tag above $6,000.

To recall, Twitter CEO and billionaire Jack Dorsey's very first tweet of March 6, 2006 which was sold in the form of NFT for $2.9 million dropped down to mere $3.77.

The Impact on the Environment

Creation of NFTs consumes energy. The minting process of NFTs involves energy consumption, just as any other operation in the digital world does, though the amount of energy consumed by minting NFTs with little to no use case might be cause for alarm, said Vlad Hategan, the author of the report.

dappGambl study identified 195,699 NFT collections with no apparent owners or market share. The energy

required to mint these NFTs is comparable to 27,789,258 kWh, resulting in an emission of approximately 16,243 metric tons of CO2.

The energy consumed to mint these NFTs without any owners is equivalent to —

• The yearly emissions of 2048 homes – it’s 7.93/ home according to the EPA.
• The yearly emissions of 3531 cars – it’s 4.6 per car according to the EPA.
• The carbon footprint of 4061 passengers flying from London (England) to Wellington (New Zealand) – it’s 4 tons of CO2 per person according to Air New Zealand.

"The responsibility rests with NFT creators to ensure meaningful and genuine contributions to the NFT ecosystem. Those primarily looking for quick gains without adding real value might end up incurring unnecessary environmental costs, all for the sake of a quick buck, " said Vlad Hategan, in the dappGambl post, and he also suggested some of the many examples of practical uses for NFTs.

On a positive note, dappGambl further concluded the report saying — NFTs still have a place in our future.

"The 2021 hype was bound to fail, as all overhyped things often are. At dappGambl, we still maintain that once the dust has settled, we will start to see an evolution within NFTs."

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