Alright y’all, real talk on this so-called NFT comeback. A 10% increase in sales volume to $127 million last week. Headlines are blaring “rebound,” “bull market,” and perhaps a dash of “I told you so!” But hold on a second before you start remortgaging the homestead to purchase imaginary felines. Hard.

I’ve been through enough market cycles to tell the difference between a true trend and a dead cat bounce. Quite honestly, this is a lot closer to the latter. We’re speaking about a 10% increase following a huge, long-term drop. Think of it like this: if your stock portfolio lost 80% of its value, would a 10% gain make you break out the champagne? I doubt it.

This isn’t a doomer approach, this is realism. Speculative trading and hype around a handful of projects don’t seem to be responsible for this small uptick. That doesn’t mean it’s a sign of an overall market sea change. It’s the crypto version of whack a mole shiny object syndrome.

Immutable down only 21% Ethereum up over 33% Polygon down over 28% So, what does it mean? It means the market isn't recovering uniformly. The headline glosses over the nuances. This isn’t a rising tide lifting all boats. Rather, it’s an unexpected localized squall hitting some boats harder than others.

Gaming and Ethereum Lead, Polygon Lags?

What’s most curious about Immutable’s gaming NFTs is the attention. Gaming might actually be a true use case for NFTs, giving players ownership of assets across games and platforms. Let’s not kid ourselves into thinking that every NFT game is just a brilliant new game design about to hit the blockchain. Truth be told, most are just badly designed cash grabs that will eventually flop, leaving players with a bunch of useless digital trinkets.

Ethereum’s recovery is dependent on the overall crypto market sentiment. What’s good or bad for Bitcoin is often just as good or bad for Ethereum, and by extension, NFTs. But remember correlation isn't causation. A high tide floats all ships, but when the tide recedes…

Polygon's decline is concerning. As one of the most popular Layer-2 solutions, it was meant to be the cheaper, faster alternative to Ethereum. If it's struggling now, it raises questions about its long-term viability and whether it can truly compete in the evolving landscape.

The buzzword is now "utility." But wait, it’s not just digital art anymore. NFTs have pioneered a new paradigm across industries—from gaming to real estate and everything, apparently. The hope is that by giving tangible, real-world value to NFTs, we’re building a long-term, viable marketplace.

Utility and Real-World Applications?

If we’re being real, how many of these “utility” NFTs are truly useful? Of the remaining, how many are simply complicated forms of creating artificial scarcity and finding new ways to milk users for cash? You know that episode of South Park where they go through all the reasons why airlines are a monopoly scam. The entire “utility” story usually ends up being just as one-sided.

Consider the real estate example. Tokenizing real estate seems like a real game changer, but that adds additional complexity and regulatory challenges by its own right. Is this truly going to simplify and improve the property market, or is it going to open up new lanes for fraud and exploitation? I am skeptical.

Furthering the hype, the article predicts the NFT market will balloon to hundreds of billions of dollars by 2030. Let's just unpack that for a second. That’s a pretty ambitious assertion, particularly given how the market is at the moment. It operates on the assumption that NFTs will make a flawless landing into gaming, real estate, and a million other sectors.

Hundreds of Billions by 2030? Really?

It's like saying, "By 2010, everyone will be flying personal jetpacks!" And yes, maybe it won’t. In reality, it’s far more likely that we will just sit in congestion hoping for a better day.

Remember Beanie Babies? They were the hottest new collectibles of the late 90s. The lengths people were willing to go to in order to purchase these plush toys was unreal. The idea was that these collectibles were going to be worth a mint one day! Sound familiar?

As you’re no doubt aware, the Beanie Baby boom eventually burst, leaving a generation of investors staring at bags full of inflated fluff balls. The lesson? Hype might be one helluva drug, but it can never replace good old fashioned essential value.

I'm not saying NFTs are dead. What I’m arguing against in this post is the idea that this current surge is anything more than a false dawn. But it’s a temporary bubble driven by speculation and hype, not a long-lasting rebound.

The lesson here is to do your due diligence. Understand the risks. Don't believe the hype. Oh, and for the love of all that is holy, don’t mortgage your house.

Approach NFTs with the same level of caution you would apply to any other speculative investment. Because, as we all know, those are just plain lies. And remember the golden rule: if it sounds too good to be true, it probably is. Don't let FOMO cloud your judgment. A healthy dose of skepticism is your best friend in this volatile market.

I'm not saying NFTs are dead. I'm saying that the current surge is likely a false dawn. It's a temporary blip fueled by speculation and hype, not a sustainable recovery.

If you're going to invest in NFTs, do your research. Understand the risks. Don't believe the hype. And for goodness' sake, don't mortgage your house.

Treat NFTs like you would treat any other risky investment. Because, let's face it, that's exactly what they are. And remember the golden rule: if it sounds too good to be true, it probably is. Don't let FOMO cloud your judgment. A healthy dose of skepticism is your best friend in this volatile market.