The NFTs market will crash overtime because it was never meant to be one in the first place, here's why

A couple of days ago, I came across a post or thread(can't exactly recall) that questioned the public on what they thought of NFTs role as digital assets, if they had a place in the future of digital assets.

Majority came up against NFTs, saying they would sooner die off, and While I accept, I also believe that this idea comes from the angle of market value and volumes, NFTs will not die off as a technology but as a market, that's just what will happen.

The mispricing of tech

There's a concept in finance that everything has a fair value. Typically, this refers to the value at which something is bought with outright agreement on price between the buyer and seller.

The problem with this finance concept is that the markets are never a determinant of "true value", the markets may call an asset overpriced but in reality, that asset is well below its true value.

A lot of technologies have been mispriced when it comes to blockchain-centric products and services. NFTs is simply one of those technologies where the markets are awfully wrong on the approach of pricing.

The first mistake the market makes is to treat NFTs as an asset on its own.

NFTs are not meant to be assets, they are meant to be "representatives" of an underlying asset, product, or service.

So when people view NFTs as assets on their own, it becomes highly difficult to assign its true value to it.

For example, let's say an NFT was minted that serves as a channel to tapping into the revenues generated from a bitcoin mining company.

The company in mention maybe makes maybe $2 million in Bitcoin mining revenue each month and is minting 10,000 revenue generating NFTs that taps from this value.

Now, blinding assigning a market value to these NFTs without looking at the underlying product it represents is what is happening with most NFTs out there.

An NFT of this nature, each could be sold for $200,000. Why? Considering that these NFTs will directly tap into the revenues of the Bitcoin mining company, each holding would be earning around 1.2% a year with this price.

Now if we consider overtime market swings, the investors may be in huge profit. What's to note here is that an NFT of this nature is highly valuable because it represents a highly valuable underlying product.

When you see monkeys and gorillas being sold for insane prices, you'd have to wonder if people are buying the arts or simply thinking there's light at the end.

Majority of the time, they'd lose money.

The NFT markets will crash and that's a good thing!

Yes, the NFTs market will crash, it simply is something that does need to have a "market", each NFT is unique to itself and shouldn't be placed up against another and grouped with another, it makes absolutely no sense.

NFT is a technology that will not fade if you ask me, I've always predicted that brands will have to adopt it at some point as a means of attaching verifiable labels to their products, these type of NFTs obviously need no market value but we can see how they are however very valuable by the services they render.

NFTs are not limited to digital assets or services, this is one other mistake many make when looking at the tech. It doesn't end with games and art, those are just a fraction of where NFTs will be leveraged.

You simply cannot overlook the potential that comes with non-fungibility in a business space where lots of brands are losing money and credibility to the increased infringements that sees fake products being sold to the general public under successful brand names.

Certificates can now have higher authenticity, same with arts and property rights. NFTs are meant to be tools, not products, this is what many do not get or simply want to ignore when it comes to non-fungible tokens.