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Non-fungible tokens (NFTs) were the hottest topic of 2021, and a new report by industry tracker, NonFungible.com, shows how NFT traders turned that hype into major gains, stoking the market into $17.6 billion of total sales—a more than 200-fold increase over 2020.
NFTs—unique digital assets such as audio clips, photos, GIFs, or other digital items, which are secured on the blockchain and can be bought and sold through online marketplaces like OpenSea—jumped into the mainstream in 2021.
The breakthrough moment for the nascent tech came after digital artist Beeple sold an NFT artwork at Christie’s last March for $69 million. Since then, tokens in top NFT collections, like CryptoPunks and Bored Ape Yacht Club, have sold for hundreds of thousands of dollars a pop.
According to Thursday’s NonFungible.com report, which was created with support from L’Atelier BNP Paribas, the total value of all NFT transactions worldwide jumped 21,350% to more than $17 billion in 2021, from $82.5 million in 2020. The 200-fold increase in the NFT market was 100 times as great as the percentage increase in the electric-vehicle market over the same period, the report says.
The broad boom in the NFT market brought millions in profits to individual sellers. NFT traders earned over $5.4 billion in total profit through buying and selling NFTs, NonFungible.com says. Of the roughly 2 million active wallets engaged in buying NFTs over last year, 473 of them generated at least $1 million in profits.
Collectibles and gaming were two categories leading the surge in NFT transactions last year. The collectibles category alone generated more than $8.4 billion in sales. Among the NFTs in the collectibles group are some of the most popular NFT projects, including Bored Ape Yacht Club, which counts among its owners celebrities such as pop star Justin Bieber and late night talk show host Jimmy Fallon.
Although last year’s increase in the NFT market was its biggest ever, the technology is still fairly new, and has benefited from publicity. Dan Kelly, CEO and cofounder of NonFungible.com, said in a statement that in 2022, the market is likely to decline overall as it matures.