According to a report published by Galaxy Research on Friday, the Bitcoin NFT ecosystem, which was virtually nonexistent only a few months ago, could grow into a $4.5 billion industry by 2025.
Experts think the recent Bitcoin Ordinal fever represents a permanent trend. They forecast that the demand for NFT storage on the world’s oldest and most established blockchain would only increase in the coming years. According to Galaxy analysts, a complete infrastructure of goods and services designed to serve this rising market will be in place by the summer of this year.
Based on the report, markets and wallets have already begun to give the necessary tools for enhancing the user experience.
Ordinals, a startup, unveiled NFT-like functionality on Bitcoin at the end of January, allowing users to encode satoshis (the smallest unit of Bitcoin, representing 0.00000001 BTC) with unique data such as images and movies. The effort was an immediate success despite the time-consuming and costly inscription process required to add assets to the Bitcoin network.
Yuga Labs, the $4 billion company responsible for the popular Ethereum NFT collection Bored Ape Yacht Club, announced on Monday the first-ever Bitcoin-based NFT project. This signifies the broadening of Ordinals’ attractiveness to the established, largely Ethereum-based NFT ecosystem.
In the article published on Friday, Yuga’s participation in Bitcoin NFTs would motivate additional artists to sign up, which will likely result in the launch of major NFT marketplaces such as OpenSea.
Yet, the cost of joining the network will identify the Bitcoin NFT market from its competitors. Galaxy believes that encrypting 10,000 Bored Ape Yacht Club NFTs onto the Bitcoin network would cost around $229,000.
Creators would likely wish to avoid such outrageous prices; Yuga’s first Bitcoin collection, TwelveFold, is a limited edition of only 300 pieces of art. Galaxy anticipates that as a result, although Ethereum will continue to house massive, multi-thousand piece PFP collections at much lower costs to producers, Bitcoin will become the home of much rarer, “high quality,” and valuable one-of-a-kind art projects.
Galaxy’s hopeful outlook for Bitcoin NFTs is contingent on the continued growth of the NFT market as a whole.
On Friday, researchers predicted that demand for NFTs created exclusively for Bitcoin will be limited.
The market has tried to return to its all-time highs since the beginning of 2022, right before Terra’s collapse triggered the current crypto winter and caused a precipitous decline in NFT prices and demand. NFT sales recently registered their highest month since the beginning of the bear market. Yet, the majority of the increase in trading volume can be attributed to the controversial trading methods on the newly launched Blur NFT marketplace, which encourages users to engage in high-volume transactions in exchange for considerable loyalty benefits.
Blur’s sudden rise, which has seen them eclipse the once-dominant OpenSea, has driven a crisis in the current NFT market. NFT marketplaces have substantially decreased creator royalties, which were originally the cornerstone of the NFTs’ value offer, in order to compete with rivals for clients. The majority of NFT projects generate revenue through royalties, which are typically between 5 and 10 percent of the sale price and paid by the vendor. Paying such fees is now optional on nearly all NFT platforms, which is great for traders because they can now raise their gains on each sale, but devastating for authors because they have no other means of support.
Those who expected that a substantial new NFT market, such as Bitcoin, could shift this paradigm may be disappointed. Because Bitcoin does not yet enable smart contracts in a substantial way, new Bitcoin NFT marketplaces are unable to enforce creator royalties or blacklist competitors who violate them.
Content Source: decrypt.co