The superheated NFTs? A crypto market niche tipped to boom or bust

A pyramid scheme where “somebody will be burnt” or an “exciting innovation?” Is this the year of the nonfungible token?
In a whirlwind seven-day period, which began with Twitter founder Jack Dorsey proving that almost anything can be tokenized — even his old tweets — and culminated on Thursday with a Christie’s art auction that brought a mind-boggling $69.3 million bid for a tokenized Beeple work — fetching more at an auction than pieces by George Seurat, Paul Gaugain or Salvador Dalí — some observers were asking: Are nonfungible tokens spiraling out of control?Even before the storied auction house catapulted artist Mike Winkelmann, aka Beeple, into the rarified company of Jeff Coons and David Hockney — i.e., living artists able to command stratospheric prices for their works — some were questioning the market’s sanity. Marketing guru and author Seth Godin, for instance, wrote in a blog post, “NFTs are a dangerous trap,” and the current mania is “an unregulated, non-transparent hustle with ‘bubble’ written all over it.” Meanwhile, on March 8, an NFT version of a deliberately-burned Banksy painting sold for almost $400,000 on marketplace OpenSea, prompting Zavier Ellis, director of a London gallery, to tell the United Kingdom’s The Telegraph: “I wonder if this is some form of pyramid selling where ultimately somebody will be burnt.” David Knowles, who runs an art advisory firm, Artelier, commented that purchasing contemporary works of art is risky generally, but buying nonfungible tokens appears to be the “extreme end” of this.It bears asking after such a …
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