Most of these projects come with a promise of experience beyond just buying a unique piece of art. For example, holders of Bored Apes are admitted to special clubs and communities, granted first access to other NFT projects, or are promised entry into ambitious metaverse projects.
On the one hand, these promises are admirable and understandable. If you bought shares in a company, wouldn’t you be worried if it never innovated or told investors about its performance?
However, on the other hand, the vast majority of NFT projects overpromise and underdeliver. For example, a project called Players Only founded last year by former NBA players raised $1.4 million ($2 million) by promising NFT owners autographed merchandise and player meetups. .
Six months later, the project was shut down, with users claiming they never received signed merchandise and players failed to show up for meetings.
These stories are scattered across the NFT space. Designers raise millions of dollars on the promise that their project will be the “next big thing”, buyers believe them and end up with the bag when designers don’t deliver on their promises. It’s easy to see why so many people rightly take a dim view of NFTs.
Proponents say the industry is in its infancy and finding its footing. They promise that the technology behind NFTs will be invaluable in our increasingly digital future, and that soon everyone will be linking their various online assets to the blockchain. Whether this is true remains to be seen and should be viewed with skepticism.
Meanwhile, NFT providers should take a cue from CryptoKitty’s book and stop pretending it’s anything more than a speculative asset that bettors can gamble on.