NFT Trends and difficulties for the year 2024

As 2023 ends, nonfungible tokens (NFTs) will still play a significant role in the Web3 ecosystem. Members of the community are optimistic about 2024 and think the asset class will see significant growth in the years to come. 

Cointelegraph spoke with a variety of Web3 professionals, who provided their thoughts and forecasts on what trends would persist into 2024, as well as what obstacles NFTs might see in the upcoming year, ranging from the growth of NFT games to ongoing regulatory uncertainties.

NFT predictions for 2024

Connections between digital and physical

 In 2024, Web3 experts anticipate that the relationship between digital and physical assets will continue to grow. John Crain, the CEO and co-founder of SuperRare Labs, the company that created the NFT marketplace SuperRare, believes that the intersection will involve the NFT space.

According to Crain, the two worlds’ connection will “significantly rise,” and NFTs will function as “digital twins and certificates of authenticity.” Additionally, Crain informed Cointelegraph that collectors highly prize physical versions of NFT paintings, which could be another growth catalyst in the upcoming year.

 Real-world asset (RWA) tokenization has been a hot topic in the cryptocurrency community since 2023. According to Oh Thongsrinoon, chief marketing officer of Altava Group, which links Web3 with premium fashion businesses, this tendency will persist in 2024, as reported by Cointelegraph.

NFTs are more than profile pictures (PFPs), as Thongsrinoon explained, saying, “We’ve always been a big believer in NFT having utilities and value beyond just a PFP.” The executive also said that Altava has implemented RWA tokenization for its customers’ NFT collections, providing services including exclusive access, branded goods, ownership and management of intellectual property, and product advice.

The CEO went on to say that NFTs would be able to “transcend speculation” and have actual value supporting the assets thanks to RWA tokenization. Thongsrinoon further mentioned that he can envision NFTs invading industries like precious metals and real estate around 2024. Similar predictions took place by Vineet Budki, CEO of Web3 venture firm Cypher Capital. “After the initial hype, NFTs will mature into valuable tools with real-world applications by 2024.” “Expect asset fractionation, dynamic digital experiences, and hybrid physical-digital blends,” Budki told Contelegraph.

NFT gaming will take off around 2024.

 Gaming is another sector where NFTs are predicted to have a role in 2024. According to Jason Lau, chief innovation officer of crypto exchange OKX, while some gamers are skeptical of Web3 games and NFTs, video game firms have been investing in the field. Square Enix’s Symbiogenesis and Mythical Games’ NFL Rivals, both of which feature NFTs, were mentioned by the CEO. Lau elaborated: 

“In 2024, I expect a new wave of Web3-enabled games will expose NFTs and new ways to use them to a wider range of gamers as user ownership of digital in-game items, characters and assets bring greater engagement and open up new business models and gameplay.”

 Lau’s opinions also reflected by Crain. The executive claimed that rather than creating engaging games for participants, the original generation of NFT games depended on nonfungible tokens as the unique component of the games. Since certain games have already begun to take a different turn, Crain anticipates 2024 to be different: “We’re finally seeing Web3 game studios building awesome games that leverage NFTs and tokens as well.”

In a prior announcement, Henry Chang, the CEO of Wemade, a South Korean game creation business, forecasted a rise in blockchain-based games by 2024. Chang clarified that the gaming community may anticipate more advanced use of blockchain in-game mechanics and gameplay as developers get more comfortable and experienced with integrating Web3 features into games. 

Bitcoin NFTs are becoming more popular in 2024

Web3 experts expect the niche to expand much more in 2023 when Bitcoin-based NFTs take the market by storm. In 2024, Lau thinks that the trend of NFT placement on the Bitcoin network will persist because educators are growing more “discerning and educated.” According to the CEO, many people have become tired of NFT initiatives that were a “quick cash grab.” 

 Lau stated that the “surprising staying power” of Bitcoin Ordinals demonstrated. The CEO stated that one benefit of Ordinals is the direct on-chain storage of the NFTs’ data and artwork. Lau continued by saying that this enables users to profit from the Bitcoin blockchain’s inherent scarcity, security, and immutability. 

Thongsrinoon is also confident that in 2024, Bitcoin NFTs will continue to grow. According to the CEO, NFTs suffered in 2023, but NFTs based on Bitcoin gained traction. He thinks this is fantastic for cryptocurrencies and has the potential to spark interest in the metaverse once again. 

Challenges for NFTs in 2024

Overcoming stigma and exhaustion

According to the experts Cointelegraph spoke with, one of the main issues the industry will deal with in 2024 is changing how people think of NFTs. NFT projects need to put in a lot of effort, according to Crain, to counter the public’s misconception that the technology is exclusively utilized for fraud. “Building engaging products and providing real value will see how consumers view them start to shift, but there’s still a lot of work to be done,” Crain said. 

At the same time, Lau pointed out that the cyclical nature of cryptocurrency applies to NFTs as well. According to the CEO, many people who heard about and dabbled with NFTs during the previous cycle are still “highly skeptical” that NFTs have evolved beyond the prior false promises. However, Lau feels that hopeful signals of recovery have emerged by the end of 2023. 

Thongsrinoon feels that projects that have made it through the crypto winter must be innovative. The executive stated that the development of Bitcoin NFTs may assist facilitate and accelerate the recovery of the NFT industry by promoting healthy competition and renewing overall interest in the NFT space. 

Regulatory concerns surrounding NFTs continue to exist

 The United States Securities and Exchange Commission along with the nation’s securities regulator, plans to target the NFT space in 2023. It filed its first unregistered securities claim against an NFT collection sold by Impact Theory, an entertainment company. Many others criticized the SEC’s stance, with some saying it’s troublesome for the regulator to imply that all NFTs are securities. 

 NFTs continue to be a “gray area,” according to Lau, even though certain governments are starting to establish regulations regarding digital assets. The executive cited the Markets in Crypto-Assets (MiCA) regulation as the EU’s all-encompassing crypto law, emphasizing that NFTs and unique assets are not covered by it. 

Similar thoughts were expressed by Budki, who claimed that investors and companies are left feeling uneasy by the state of affairs. The leadership emphasized that a clear legal framework is necessary for NFTs to thrive in 2024. 

The Future of NFTs

When asked about their views on the future of NFTs, the executives were upbeat about the technology. Crain believes that NFTs will become conventional internet infrastructure. According to the executive, NFTs give a simple and effective “mechanism for provenance” of digital assets. He elaborated: 

“This will have profound implications, especially in a world with AI capabilities increasing at an exponential rate. Being able to discern what is real and what is not will be an incredibly important feature in the next phase of the internet.”

 Meanwhile, Lau emphasized the importance of RWA tokenization and NFTs in expressing what humans value in the digital and physical worlds. Furthermore, the CEO referred to NFTs as a “blank canvas” that may mold and change to capture an “endless range of possibilities.”