NFT market will crash soon, it is inevitable
Important notice: Please be aware that twitter account @JiangZhuoer1 is a fake, the genuine one is @JiangZhuoer for English followers and @JiangZhuoer2 for Chinese followers.
On the same date about a year ago, I predicted that the DeFi liquidity mining market would collapse within 20 days, but it did so in 24 hours.
“The DeFi ATH is probably over, it will not last over 20 days before the market crashes” — I have predicted on September 3, 2020.
During this year, although we lost an important reverse index(let’s observe 3 minutes of silence for him), but I still make a prediction: the NFTs like bored ape, CryptoPunks and Loot will crash within 20 days.
There is no doubt that NFT profile pictures will collapse, and it is really difficult to predict when that will take place.
When I say the crash is inevitable, because at the micro level, the crash is determined by supply and demand force. The demand side(investments) for NFT is finite, while the supply(NFT Profile pictures) is infinite. Any artist can easily draw or generate large number of profile pics using computer programs, as many as he wants. It is quite ridiculous that a JPG profile values 100–1000ETH(equivalent to $39K-3.9M ). This is a typical greater fool story.
The emergence of Loot(text NFT), which increased the supply to an infinite extent, will mark the collapse of NFT Profile pics. The trend was so obvious that I didn’t even bother to create a calculation model.
Don’t be dazzled by the Loot’s fancy artistic concepts: emerging, filling, building and bottom-up processing, actually, only supply and demand are the determined factors of the price. Loot equals to an infinite supply, so that some people laugh that Loot is the creation of liberal art students who can’t draw, instantly filling their production gap with art students.
The demand(investments) of NFT Profile pics lacks retail investors, thus it will decay much faster than normal schemes.
The following is a dialogue I had with a college student outside the cryptocurrency circle, it represents the majority of small investors’ views on NFT:
(The woman used a NFT Profile picture as her avatar)
I: You actually use a NFT profile picture! I’m curious about how you got it?
Student: Mine is a fake. Same as Stephen Curry.
I: I see. You know it from Stephen Curry?
Student: No, Stephen Curry spent $180,000, but I only took 5 scondes to make a copy. Yep!
The crash of NFT will be more scary than that of Defi, because:
Defi, at least, is a fungible token, which means it doesn’t have a liquidity problem, if you want to sell at a lower price, there will be eventually buyers. But NFT is a non-fungible token, different from Defi, once the crash happens, the liquidity of NFT will instantly drops to zero, some NFT pieces used to worth hundreds of ETH will become valueless in a blink of eye.
Are you wondering what will eventually happen to the JPG NFT Profiles that currently worth hundreds of ETH? There’s no new thing under the sun, go search for the CryptoKitties in 2017, a lesson learned from the past.
I’d like to Emphasize once more
Last year, I only predicted the crash of Defi’s liquidation mining, not the DeFi industry, and I never thought that Defi is worthless.
NFT is a part of ETH’s contract freedom, and we will see a great development of NFT in many collection areas in the future, such as player cards, artwork, celebrity souvenirs and songs, etc.
Vast, tremendous NFT transactions + ETP 1559 = Enormous ETH burning
You can continue speculating your NFT while I accumulate my ETH,
Exchanges take commissions and they are invincible.
ETH is no longer infinite fuel, but deflationary gold. ETH is a super asset with four features: stored value, deflationary, interest-bearing and means of production.
ETH will drive the second half of the bull run and its price will break the former ATH faster than BTC.
The total market capitalization of ETH will surpass BTC, which means, ETH will claim the throne of cryptocurrency.
I heavily invested in ETH, so the crash of NFT will slower the speed of ETH burning, which is detrimental to the ETH and will cause my losses. Therefore, I’m not a stakeholder.