Following the peak in May, the global Google searches for “NFT” have been gradually decreasing. With the numerous assumptions that the NFT market is in a bubble state and the comparisons with the ICOs from 2017/2018, the question arises if non-fungible tokens could be bursting soon.
NFT Searches Drop Sharply
What was 2020 for decentralized finance is 2021 so far for non-fungible tokens. Although NFTs were not invented this year, their popularity saw a massive boost in the past several months.
In this same timeframe, everything became an NFT. From digital artworks, albums, rare collectibles to even historic tweets and announcements. The industry saw the entrance of countless celebrities all talking about cryptocurrencies and this new hot topic non-fungible tokens.
Naturally, this craze expanded to retail investors who, in wondering how they can get on the NFT bandwagon, went to Google. CryptoPotato reported in early March that the worldwide “NFT” queries on the worlds largest search engine skyrocketed to new all-time high levels. They stood there for a few consecutive weeks.
However, more recent data shows a trend reversal. The number of searches has decreased almost by half since the peak in March.
Google Searches for NFT 12-m Back. Source: Google Trends
Separately, the average price of NFT sold declined by about 70% from February to early April, suggesting that the non-fungible token craze could be fading.
Is it the ICO Thing All Over Again？
Those who have been involved or interested in the cryptocurrency space since (at least) 2017 have undoubtedly heard about initial coin offerings (ICOs). Long before DeFi and NFT took the main stage, investors were standing in (virtual) lines to put their funds into ICOs.
As soon as a new project emerged and promised groundbreaking solutions to revolutionize every sphere of human existence, it raised dozens of millions of dollars in days.
Those who remained interested in the space in 2018 saw the massive burst of that bubble. A few years later, the similarities between the two are more than just the substantial funds put in unproven projects and primarily employing the Ethereum blockchain.
Both reached mainstream media; both received sometimes questionable backing by celebrities, and, last but not least, both were the hottest discussion topics for crypto insiders and outsiders for months.
The narrative that NFTs are in a bubble state now is frequently supported by reports claiming that NFTs are in a bubble state now. Even insiders, including Beeple – the artist who sold an NFT for a record-setting amount of $69 million – said the industry is “absolutely” in a bubble.
Consequently, given the aforementioned information with the declining interest, prices, and comparisons, NFTs could soon become the latest crypto aftermath.