Okay, so NFTs are "back," huh? That’s a pretty $530 million in trading volume all the way back in July. But you’d never know it from the headlines, which are screaming about a DeFi resurgence, even reversing DeFi in daily users. But before you dive in with both feet, let’s hit the pause button and examine what’s actually happening. Having lived through enough market cycles, I know a dead cat bounce when I see one. Today, however, I’m seeing big red flags flying.

Fewer Transactions, Higher Prices?

That $530 million figure sounds impressive, right? Look beyond the headlines, and you’ll see the dollar amount of real transactions dropped by 4%. Five million NFTs bought and sold, sure, but that’s five million people who are passing their NFT through fewer hands than ever. The average sale price more than doubled, leaping up to $105. Think about what that means. This isn’t some grassroots movement. This isn’t just a flood of new consumers jumping into NFTs. This latest “resurgence” appears to be driven by fewer people buying higher priced NFTs. Is this sustainable? I think not. It's like saying the housing market is booming because a handful of mansions sold for exorbitant prices, while the average family can't afford a starter home.

This takes me back to my baba days in the stock market. Everyone was trying to get in front of the next big story, chasing the next hot tip, the can’t miss opportunity. The wise capital? They were focused on the fundamentals, the real value underneath. Are these NFTs truly more valuable, or is this simply a byproduct of demand being artificially inflated?

Blur's Grip: Organic or Artificial?

Then there’s Blur, which as of this writing accounts for an eye-popping 80% of Ethereum-based NFT trading volume. Eighty percent! That's not market dominance; that's a near-monopoly. And while they may be serving professional traders well with their Blend lending feature, you have to ask: how did they get there? We’re left to wonder—is this organic growth, powered by better technology and more real users? Or is something else at play?

The skeptic in me suspects wash trading. Blur provides a number of incentives, which could all be gamed to pump trading volume nonetheless. Individuals trading their own NFTs back and forth to artificially inflate the perceived market demand. It’s the digital equivalent of a used car salesman lowering the price by rolling back the odometer. It’s something that regulators will start to notice sooner rather than later. Remember the ICO boom? How did that end?

"Utility" – Real or Just Buzz?

The narrative is shifting. NFTs aren’t just about digital art and collectibles anymore. They’re maturing into “killer applications” such as digital identity, event ticketing, and real-world asset tokenization. Alright, you have my attention… I’m snatching up a bushels worth of salt.

I've heard this song and dance before. You know, back when blockchain was all the rage and poised to solve the world’s woes. Supply chain management, voting systems, healthcare records... Where are all those revolutionary applications now?

Are these NFT “utilities” really solving real-world issues? Or just marketing speak to help raise premiums. Tokenized real world assets may have a nice ring to them, but what are the legal and regulatory considerations? Do they have the infrastructure to support this type of demand? And honestly, are NFTs the best answer to these issues? Or simply the shiniest new hammer that’s out there looking for a nail!

Consider event ticketing. Sure, an NFT ticket could prevent scalping. Does the average concert-goer want to deal with a digital wallet and gas fees just to see their favorite band? Or do they prefer simply purchasing a Ticketmaster ticket?

DeFi vs. NFTs: Infrastructure Matters

NFTs are seemingly taking center stage with “flipping” DeFi in users, make sure we don’t miss the real fundamentals. DeFi still managed to fill up that wall, brick by brick, in just a few years. Despite this bleak landscape, the innovation continues. Total value locked (TVL) is still skyrocketing and is building infrastructure that’s never been more robust and secure.

Can we say the same for NFTs? Are the smart contracts as thoroughly audited? Are the regulatory frameworks as clear? Are the custody solutions as secure? I have my doubts.

Far from it—I’m a huge proponent of due diligence and responsible investment. And honestly, the NFT space is sometimes like the Wild West. High potential, sure, but high risk.

Greed and Complacency

Here's a connection you weren't expecting: Nordic hiking and NFTs. And I personally enjoy an incredible hike in the Rocky Mountains. And you know what the most dangerous thing is? Complacency. Assuming you know the trail, ignoring the weather, not reading or planning for changes in route.

The same is true in investing. The $530 million NFT resurgence could be interpreted as the beginning of the end for the bear market. Do not allow the mania to distract you from thinking it all through. Don't be complacent. Take your time, know what you’re getting into, and be ready to turn back if the situation isn’t right.

And don't forget the environmental impact. All those Ethereum transactions have a serious carbon footprint. As a lover of the environment, I believe we need to be more ethical with our investments.

The NFT space could have a future. It needs to mature. It must do so in a way that prioritizes true utility over shiny new hype. It needs to address the environmental concerns. It has to be a hell of a lot more transparent and less prone to manipulation. Until then, count me among the spectators, cautiously optimistic for sure, but skeptical. Probably planning my next hike.