Interesting parallels btw real life & metaverse:
IRL when a currency depreciates, it's good for the country's exports b/c products are now cheaper.
That's exactly what happened w/ NFT.
In past mo ETH depreciated 40% vs USD--> NFT sales volume ballooned...
IRL when a currency depreciates, it's good for the country's exports b/c products are now cheaper.
That's exactly what happened w/ NFT.
In past mo ETH depreciated 40% vs USD--> NFT sales volume ballooned...
It's interesting that sales vol increased almost 80% in same period. implying a price elasticity of 80% / 40% = 2, which puts NFTs square in the luxury goods category, i.e. if we assume eth prices of NFTs are sticky as eth depreciates.
In reality price elasticity is lower b/c prices denominated in eth did change at least for some bluechip projects.
e.g. while eth depreciated 40%, average eth price for Cool Cats increased 40%, making average price in USD roughly same as before eth depreciation.
e.g. while eth depreciated 40%, average eth price for Cool Cats increased 40%, making average price in USD roughly same as before eth depreciation.
The same cannot be said abt all projects though. Many didn't see sufficient price increase in eth to off set currency depreciation.
Imo whether a NFT can at least retain its $ value when underlining currency goes through major volatility is a litmus test of staying power.
Those whose prices go up when underlining L1 token goes down & at least stay same when L1 token price goes up are the real deal.
Those whose prices go up when underlining L1 token goes down & at least stay same when L1 token price goes up are the real deal.
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