On its decentralized storage network, Filecoin claims to be uploading one non-fungible token per second, or around 86,400 NFTs per day. However, even though many have applauded the growth of tokenized digital artwork, other detractors argue that the business is becoming cluttered.
“While NFTs are expanding – and maybe becoming saturated – large variety game and esports firms will not enter the market until the issue of fraud is resolved,” stated R.J Mark, founder and CEO of Verasity, an esports, and gaming company.
According to Protocol Labs’ head of product Pooja Shah, the Filecoin database now has over 7.75 million NFTs, representing over 55,000 terabytes of data. In addition, she noted that Filecoin is being used by platforms like Opensea, Makersplace, and Jigstack to store their non-fungible currencies.
Filecoin is an open-source protocol that uses blockchain technology to store data online. The decentralized storage network, created by Protocol Labs, allows users to rent hard drive space that they may maintain themselves or have Filecoin do it for them. On the network, anyone can add and retrieve their NFT data.
According to Shah, the number of people wishing to store non-fungible tokens on Filecoin is “increasing.” However, she didn’t say which types of NFTs had seen the most uploads. According to Dappradar, the most popular non-fungible tokens are collectibles, art, and utility.
‘Valuable NFT projects will grow’
Small transactions often dominate the market, with approximately 60% of NFTs traded in the three months leading up to September costing between $100 and $1,000. This indicates that authors may be seeking a quick buck by producing NFTs on whatever they deem valuable.
Now that there is no limit on who or what can issue an NFT or create markets for crypto artwork, critics question whether the amount of NFTs given will ever be capped.
However, not everyone agrees with this conclusion. Corite, a platform that allows fans to invest in musicians, co-founder, and chief operating officer Emil Angervall believes that initiatives with actual value will flourish.
However, not everyone agrees with this conclusion. Corite, a platform that allows fans to invest in musicians, co-founder, and chief operating officer Emil Angervall believes that initiatives with actual value will flourish.
“Looking at raw figures to judge the status of the market is less important.” One NFT is not the same as another. The number of web pages was an essential metric in the early days of the Internet, but it’s no longer relevant. The sites and services that deliver value are critical to us. “The same may be said about NFTs,” he added.
Angervall uses the example of Spotify, where more than 60,000 music is uploaded every day, to argue that as the cost of distribution – and storage – decreases, decentralized markets would unavoidably face similar issues.
“This means there will be an unlimited amount of stuff, the market’s total value will expand, but the great majority of it will be worthless,” he explained.
Filecoin capitalizes on Ethereum’s flaws
The premise is that Filecoin is gaining popularity because transacting and storing data on the Ethereum blockchain, where most NFTs have typically been developed, has grown prohibitively expensive.
Solana and Ronin, for example, are cheaper blockchains that have benefited from Ethereum’s gas fees nightmare. According to Dappradar, Ronin accounted for over 20% of the non-fungible tokens market share in the third quarter of 2021. In addition, the network can handle and store massive amounts of NFTs.
Furthermore, Filecoin has signed collaborations with big non-fungible token businesses like Opensea and Flow Blockchain, resulting in a significant increase in the volume of digital artwork submitted to the network.
“Both networks [Opensea and Flow Blockchain] are home to top NFT projects, meaning that Filecoin now has a large share of this multi-million-dollar market, as they have combined to create surging demand for Filecoin transactions,” said Zack Horn, chief knowledge officer of Adacash, a token with a reward system on the Binance Smart Chain.
According to data from Dappradar, the total quantity of NFTs sold in Q3 increased by more than eightfold over the previous quarter to $10.7 billion. According to the market tracker, the third-quarter total was up from $1.3 billion in Q2 and $1.2 billion in Q1.