NFT is a token issued through ICO to sell intelligent contracts on a blockchain platform. For example, suppose you want to buy a house, but you don’t have enough money to purchase a home. In this case, you will approach the bank for a mortgage if you’re wondering if bitcoin has an economic value.
Similarly, smart contracts on blockchain platforms help people achieve transparency in business transactions. Nowadays, new startup companies come with the idea of selling digital assets to investors (tokenized business model).
They distribute their tokens through ICOs (initial coin offering) based on Ethereum or EOS blockchain platform. Startup companies use ICOs for raising funds. On the other hand, investors purchase these digital assets to get higher profits in the future.
9 major impacts of bitcoin on the NFT market
- The NFT market directly surged due to the increasing demand for cryptocurrency and blockchain technology. According to estimates, more than 20 thousand new cryptocurrencies that emerged until 2018 kept their market cap under $100 million.
- NFT Tokens can also be used as a security token for representing shares of company stock on a blockchain platform.
- On Ether Delta, anyone can trade their NFT tokens against another ERC20 coin, for example, bitcoin or Ethereum. It is one of the easiest ways to exchange your NFT tokens into BTC or ETH without paying transaction fees on exchanges.
- Bitcoin’s blockchain is one of the most popular and well-established blockchain platforms in the world. NFT also uses bitcoin’s blockchain network, which creates an impression among investors that it is safe and secure.
- Bitcoin can be used by gamers to buy in-game items and exchange them with other participants. In addition, the bitcoin blockchain has a faster settlement rate than any other cryptocurrency, which makes NFT more valuable.
- Bitcoin’s price is the highest among all cryptocurrencies in the market right now. This encourages new investors to invest in cryptocurrency even more. Bitcoin is one such cryptocurrency that brings higher returns than any other coin in the market.
- Bitcoin’s blockchain technology is also used to transfer digital assets and items between different participants on a single platform. This tokenization of digital assets improves the overall value and liquidity of NFT tokens.
- Bitcoin’s blockchain is a short and accurate record of transactions. In addition, these records are visible to all bitcoin users in the network, which makes counterfeit/fraudster NFTs useless for trading purposes.
- The multi-million dollar market cap of NFT is also linked with the overall market cap of bitcoin. This helps NFT tokens attract potential investors looking for high returns in the bitcoin market.
4 ways NFT market will grow with the help of bitcoin
- NFT tokens are used for purchasing unique in-game items. According to statistics, total revenue generated from games was more than $108 billion in 2019, while, according to Forbes, the Metaverse market for gaming hardware producers and online game makers could reach $400 billion by 2024.
- More than 3 million gamers are estimated to be using cryptocurrency worldwide, making it a popular payment method for the mobile gaming market. As a result, NFT market growth is expected to reach $ 5 trillion in three years with a CAGR of 30%.
- Most cryptocurrencies have been introduced to create a new ecosystem and change the existing one. For example, Bitcoin, the pioneer cryptocurrency in the market, was introduced to facilitate Peer-to-Peer transactions without any intermediaries.
- NFTs represent digital assets that are unique from each other, which helps transfer ownership from one person to another or from one game to another. Thus, the NFT market will be one of the largest asset classes in the coming future with bitcoin.
Bitcoin will play an essential role in the growth of the NFT market as it is the most popular cryptocurrency with a good market cap. Most people have heard about bitcoins already, but they are still unaware of blockchain technology responsible for its development.
Even though people can exchange their NFT tokens on Ether Delta, there are not many websites on which you can exchange NFT tokens, and the only reason is security. Currently, bitcoin is one of the safest and most secure currencies in the NFT market, contributing to its growth.