According to a recent businesswire analysis, the non-fungible token (NFT) market in the UAE is predicted to increase by 45.5 percent per year, reaching US$982.1 million in 2022.
Within 2022-2028, the NFT industry is predicted to increase at a compound annual growth rate (CAGR) of 32.1 percent. According to the report, the country’s NFT spend will rise from $982.1 million in 2022 to $4.75 billion by 2028.
Rise of NFTs with adoption of technology
The adoption of new technology is driving the growth of the NFT market in the UAE. The fast-growing industry is attracting an increasing number of entrepreneurs, businesses, and celebrities. The UAE appears to be becoming a global hub in the burgeoning sector of NFTs, according to the report, despite the country long being considered a good site for doing business.
“Consumers are interested in buying into stories, in buying into experiences. When you’re buying a product you’re just buying the physical product. But when you are buying an NFT you’re buying a whole lot of things that are linked with it,” Arshad Zaheer, Senior Partner at YAAP, told Khaleej Times in an interview.
The fact that NFTs are built on blockchain is their primary benefit. “Thus every ownership can be tracked. The content creator knows that my work cannot be copied there can’t be any pilferage that could be happening,” Zaheer explained.
While more countries strive to put tight regulatory restrictions on NFTs, the UAE has seen a significant increase in the buying, selling, and manufacture of NFTs, according to a businesswire report. “In the Middle East and Africa region, particularly in the UAE, there has been an uptake in NFT-related activities. In 2022, Art Dubai – the largest contemporary art fair in the Mena region – welcomed nearly 100 international and local art dealers and a digital collection of 17 platforms and galleries dedicated to showcasing and selling NFTs.”
Several creative NFT platforms have also formed in the country over the last year, making it relatively easier for the general public to buy, sell, and trade in NFTs. “From NFT-based startups to cryptocurrency exchanges, several players are entering the UAE NFT market; the presence of several NFT marketplaces has also supported the rise in NFT trading transaction value and volume, with the trend expected to gain further traction in the UAE over the next three to four years,” according to the report.
Will NFTs’ value go up?
The societal influence that NFTs can have is a significant advantage. TOMS, the apparel brand, recently released an NFT on one of their classic shoes, with proceeds going to TOMS Impact Partner International Medical Corps. “From NFT-based startups to cryptocurrency exchanges, several players are entering the UAE NFT market; the presence of several NFT marketplaces has also supported the rise in NFT trading transaction value and volume, the trend expected to gain further momentum over the next three to four years in the UAE,” Zaheer explained.
As Zaheer said that the value of NFTs will rise due to scarcity, design, and people discussing it in the material on social media. “So if you just buy the shoe, the proceeds will be donated once. But as an NFT, every time it is sold and resold, because there is a very smart contract linked to it, the benefits will go on and on,” he added.
Zaheer believes that the potential for NFTs is enormous. “So social causes get amplified on blockchain and NFTs and thus brands are adapting to it,” he added.
