Surely, you have heard of an NFT. But, are you really familiar with NFTs? Do you know the stats?
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The NFT market cap is currently over $6 billion.
Currently, there are more than 500,000 active NFT wallets, each conducting an average of 1 transaction per week.
The most expensive NFT ever sold was "The Merge" which went for $91.8 million.
Millennials are roughly 3x as likely to trade in NFTs as a member of Gen Z.
The average value of a single NFT is less than $200.
Art is the most popular type of NFT, accounting for roughly 85 percent of all NFTs.
Only about four percent of individuals in the U.S. own any NFTs.
More than 70% of U.S. residents don't know what an NFT is.
In order to run NFT transactions, a large number of devices consume more than 500 GWh of power each year. That’s enough to power a small city.
NFTs are so popular that there are more than 8 million YouTube videos and 14 million published articles on the topic.
What is an NFT?
The first NFT was produced in 2014, and it was sold as part of a demonstration for $4. Since then, NFTs have exploded in popularity, creating a multi-billion-dollar marketplace and creating endless discussions.
For the unfamiliar, NFT stands for “non-fungible token.” It’s a digital concept built on the premise of blockchain technology. Basically, for anything that can exist digitally — be it a picture, video, sentence, audio clip, or just about anything else — you can create a single token. That token uses complicated encryption to put it on a blockchain (most commonly Ethereum is used for this purpose). As a result, there is a public ledger that shows when the NFT was created and who it belongs to. As a result, the NFT itself cannot be duplicated.
That same token can then be traded or sold, and the blockchain ledger will track ownership.
In a way, you can think of the NFT as a digital certificate of authenticity. For any piece of digital media, there can only ever be one NFT, and each NFT can only have one owner. For anyone who enjoys collecting, NFTs have inherent value, and thus an entirely new market was born from this digital idea.
The concept can be a little weird, but when you see the sheer statistics behind the NFT market, you’ll see that it is a serious business worthy of some attention. So, let’s look at some of those statistics and see what we can learn from them.
General Usage Statistics
While NFTs have existed for nearly a decade, they have gained massive popularity increases since 2020. In 2020, there were an estimated 500,000 individuals trading across all NFT markets. By the end of 2021, that number grew to 28.6 million. It surged to roughly 50 million in 2022.
Overall, NFT usage grew 131-fold from the 1st quarter of 2020 to the last quarter of 2022, and in this period, more than $2 billion in NFT sales were conducted. This 2-year period represents more growth than the history of NFTs before 2020. In other words, the NFT market grew more from 2020 to 2022 than it did from 2014 to 2020.
Currently, there are more than 265,000 wallets active on the Ethereum blockchain (which is one of several major blockchains), and at the peak, there have been more than 20,000 NFT buyers in the market in a single week.
When it comes to who participates in NFT markets, millennials lead the charge. They are roughly three times as likely to trade NFTs when compared to Gen Z, which is the second-most engaged generation.
Internationally, Asian countries are the biggest participants in NFT trades. As of the end of 2021, more than 70 percent of U.S. residents still didn’t know what an NFT is. Among Asian countries, the NFT leaders are The Philippines and Thailand, in terms of per-capita ownership. In the Philippines, roughly 32 percent of the population owns at least one NFT. In Thailand, that number is down to 26.6 percent. Other areas of popularity include Malaysia (23.9 percent), Vietnam (17.4 percent), and Hong Kong (10.7 percent).
For comparison, U.S. ownership rates sit at around four percent, and the United States is not included in the 10 countries with the highest NFT ownership rates. This is consistent with findings that the vast majority of U.S. residents do not have a strong understanding of what NFTs are.
NFT Market Information
NFTs are sold in a number of different markets. Combined, they represent a total market cap of over $7 billion, which is less than the total trading volume. The total trading volume currently sits at just over $10 billion. This represents an assumption that NFT values are in consistent decline, and that has certainly proven true since the end of 2021.
Among the many NFT marketplaces, OpenSea is the largest and best known. It accounts for roughly $6.5 billion in trading volume, which is about 65 percent of all NFT trades worldwide. In fact, OpenSea handles more NFT transactions than all other marketplaces combined. OpenSea will come up in later sections, and it is a leading marketplace for the trade of digital art NFTs.
There are also complete NFT collections. The most valuable of them are as follows:
Bored Ape Yacht Club, valued at $1.16 billion
Mutant Ape Yacht Club, worth $443.8 million
Otherdeed for Otherside, estimated at $303.56 million
Asuki, priced at $216.56 million
Clone X - X Takashi Murakami, worth $153.26 million
Individual NFT Values
The value of a single NFT can range from a fraction of a dollar to tens of millions of dollars. On average, the value of a single NFT is less than $200. Considering that the average cost of minting and selling an NFT ranges from $70 to $120, profit margins are typically very thin.
The most expensive NFT ever sold is “The Merge.” It sold on December 2nd of 2021 for $91.8 million. While this is the single record, thousands of NFTs sell above the million-dollar price mark every year.
As an example, the Shiba Inu “Doge” meme sold for $4 million. The “Doge” meme is a specific image that has been used to create countless memes. The root image is what was used to create the token for this specific example, and it shows that memes themselves can be made into NFTs.
NFT Resource Consumption
NFT Power Consumption
The computational power behind any NFT transaction depends on the blockchain used to verify and how that blockchain functions. Ethereum is the leading blockchain for this, and it utilizes 48.14 kilowatt hours of power for each transaction. For context, this is about 1.5 days’-worth of energy for an average household.
Each NFT sale involves a single transaction on the blockchain. In 2022 there were more than 10.4 million NFT sales. That yields a total of about 500 GWh (Gigawatt hours) for all transactions in the year. That’s an energy consumption equivalent to all of the electricity produced by an average power plant for three weeks.
Put another way, the 500 GWh used for NFT transactions in 2022 drove a total of roughly $6 billion in sales. Purchasing 500 GWh for generic use would cost, on average, about $75 million USD. The profit margin (considering only energy costs) on NFT transactions sits at an average value of $80.
NFT Computational Power
Raw electricity is one way to measure power, but NFT transactions also require computational power in order to function. The computational power needed to run the entire Ethereum blockchain is roughly 58 exaFLOPs. That’s more than 50 times the computational power of the most powerful supercomputer in the world.
But, NFTs do not account for all of that computation. Instead, NFTs constitute about 17 percent of Ethereum holdings and transactions. As a result, we can estimate that about 10 exaFLOPs are required to handle all of the NFTs in the world.
For a bit more context, the iPhone 12 performs about 11 teraFLOPs at maximum capacity. An exaFLOP is 1 million teraFLOPs, suggesting that it would take about 900,000 iPhones to manage all NFT transactions in the world. As many Ethereum mining devices are considerably more powerful than an iPhone, the number of devices involved in the process is likely much lower.
Sports represent one of the major marketplaces for NFTs. It’s common to create NFTs of athlete pictures and portraits. It’s also common to clip extraordinary plays and create NFTs for the short videos.
As an example, LeBron James has sold an NFT of a play he made for more than $100,000. It’s a single video clip of one scoring play.
The example of LeBron James is not randomly selected, either. He represents the most expensive sports NFT ever created, which was a LeBron James Statue, and it sold for $21.6 million.
In fact, the NBA accounts for more NFTs than any other major sport, and NBA Top Shot is the leading provider of those NFTs. Top Shot is an addendum of Dapper Labs, which is the largest sports NFT marketplace.
Art is easily the largest marketplace for NFT trading. The aforementioned OpenSea is the leading exchange for art-based NFTs. If you want an NFT for a picture or video, OpenSea is the most likely place to find it.
Currently, OpenSea manages more than $6 billion in total trading volume. That accounts for more than 85 percent of all NFT exchanges in 2022.
On the high end, digital art NFTs can trade for more than a million dollars apiece, and this is where the average trade (as mentioned before) is a little under $200.
The concept caught fire among artists themselves. Roughly 3,500 artists have already created more than 500,000 new NFTs (just in 2021). This surge has been such that art NFTs now constitute 16 percent of all art value. That is, NFTs make up a sixth of all art value in the world.
Music is another place where NFTs are popular. Artists can create digital NFT tags for entire songs. As an example, Eminem sold an entire collection of his musical NFTs for $4.78 million.
NFTs are also becoming a popular option to monetize the release of postmortem content. The estate of XXXTentacion is selling unreleased songs as NFTs. Owners of unreleased Whitney Houston tracks are doing the same, and it’s likely that this trend will emerge for other deceased artists.
The music component of the NFT market capped at $1.35 billion in 2021, but like the rest of the NFT market, it shrank in 2022. The final numbers are still pending.
There are also cases where social media content is the source of tokens, and they can also trade at varying values. One of the most famous NFT sales in history involved Jack Dorsey (the creator of Twitter). He created an NFT of his very first tweet. He then sold that NFT for $2.9 million.
That is the most expensive social media NFT so far, but it started a trend. Tweets, Instagram posts, and other social media content are now regularly used to create and sell NFTs.
While the social media component of the NFT market is currently well below $1 billion, Forbes estimates suggest that social media NFTs could be worth more than $10 billion by 2030.
There are a few additional NFT markets that are worth mentioning but don’t quite match the above markets in total value and popularity. Video games are a source of many NFTs. Unique game visuals can be traded. Esports clips are also sometimes traded, similar to NBA NFTs.
Collectibles make up another market where digital art representing a collectible can be used to make a token. Memes form an entire additional marketplace. Beyond that, domain names and virtual fashion are other popular choices.
NFT Video Content
NFT popularity can be expressed in more than just financial and computational terms. NFTs are a frequent topic of conversation, and some statistics highlight just how many conversations revolve around them.
A Google search of NFT video content on YouTube provides more than 8 million hits. That constitutes roughly 90 million minutes of video content, and that’s just on YouTube. TikTok, Facebook shorts, and other resources likely add many more millions of minutes of content to the total.
Interestingly enough, YouTube has noticed the NFT trend, and it has even created a tool for making NFTs out of posted videos. Using this, you could trade an NFT for a video that is about NFTs.
NFT Blog and Article Content
What about other forms of content? How popular are NFTs for articles and blog posts? Using similar search methods, Google compiled more than 15 million news articles discussing NFTs. While the publications vary dramatically in outreach and aim, that’s more than 15 million published articles on the topic.
As for blog and forum conversations, that number tops 80 million.
Here’s a potentially interesting addition to these statistics. Many of the news articles and blog posts are monetized (as are many of the videos mentioned in the previous section). Using rough estimates, it’s possible that NFTs are generating significant revenue outside of NFT trading. An estimated $5 million in ad revenue has been generated just by YouTube videos discussing NFTs.
Article and blog revenues are much harder to estimate, but NFT content is likely responsible for generating somewhere between $800,000 and $8 million in total revenue. Keep in mind that these are lifetime statistics, not annual rates.
NFTs have seen a popularity crash since the end of 2021. Despite that, they still represent a multi-billion-dollar industry. There are millions of people involved in the trade, and they encompass art and content across a wide variety of interests.
NFTs are often seen as a way to empower artists and creatives, enabling them a direct means to monetize their work. If nothing else, they also represent a rapid change to culture and economics with a potential that is nowhere near capped.
All said, NFTs remain such a popular topic of conversation that simply talking about NFTs is a market worth more than $10 million.
Considering all of this, experts still expect long-term growth in the NFT markets, even if short-term growth remains negative. NFTs are a part of the world now, and it will be interesting to see how NFT trends change in the coming years.