It’s hard to fade the NFT craze these days. Coming from a technical background, I still focus largely on infrastructure and DeFi projects. My minimal experience with buying NFTs don’t qualify as an enthusiast or collector. I do think that quite a lot of them are well drawn and very collectible, for example these are my current favorites:

CREYZIES, an official airdrop to mfers holders. I like the bold style even better than the original mfers.

https://opensea.io/collection/creyzies

SongWaiMai (literally “Takeout delivery” in Chinese). A popular meme in the Chinese crypto space. Some bikes look really cool.

https://opensea.io/collection/waimaidao

Yet I still have a hard time justifying the insane valuation of some of the “bluechips”.

Nevertheless, just recently I came to terms with the fact that NFTs might be the consumption part of the equation in the burgeoning new economy being shaped by blockchains. I’m by no means an expert in economics, but I know that in classical economic terms one often talk about the three prongs (or the “troika”) of an economy being investment, consumption and exports. There’s also the expenditure approach of calculating the GDP using the formula:

GDP = Consumption + Investment + Government Spending + Net Exports

In either case, consumption seems to be a crucial part of the equation when measuring economic activities. If one were to make a crude yet reasonable comparison between blockchains and countries, then DeFis are more about investment while NFTs are more about consumption. A healthy economy needs both to flourish.

Thinking further in this mindset, the vast majority of consumer products will lose market value over the course of time. As soon as they are sold from the shops, their resale price could very well fall off a cliff then slowly decay as time goes on. Only few collectibles withstand the test of time and you will be lucky to own one. With NFTs being able to exist “in perpetuity” as opposed to traditional luxury items, I also find it questionable how much rarity means when the potential supply is infinite. Maybe I still need to be educated on that part.

So next time, don’t feel bad if the floor price your shiny new NFT drops to lower than the gas fee you spent just a few days after you bought it. At least you can still show it off in your web3 profile, and the pixels will be with you for as long as Vitalik the CEO keeps Ethereum up and running.