Hey, Whatever Happened to NFTs?

TL;DR

NFTs collapsed 93% from their 2021 peak because speculative frenzy, wash trading, and celebrity hype inflated worthless digital certificates beyond any real utility.

Key Points

• 1.NFTs started as a legitimate tool for artist ownership. In 2014, Kevin McCoy and Anil Dash created the concept at a NYC hackathon to help digital artists monetize and control their work — a genuine problem since digital files can be freely copied.
• 2.The market exploded 21,000% in a single year. NFT trading volume grew from $82 million in 2020 to $17.6 billion in 2021, fueled by celebrity endorsements from Paris Hilton, Eminem, Justin Bieber, and Snoop Dogg, and a Beeple JPEG selling for $69.3 million at Christie's.
• 3.Wash trading made the market size largely fictional. On one marketplace, Looks Rare, wash trading — selling NFTs to yourself using two wallets — accounted for $18 billion, roughly 95% of reported volume, artificially inflating perceived market legitimacy.
• 4.The collapse was catastrophic and nearly total. By May 2022, daily NFT sales dropped 92% from peak; a 2024 report found 96% of NFT projects effectively dead; Justin Bieber's $1.3M Bored Ape fell to ~$12,000, and the Beeple JPEG dropped from $69M to ~$2,300.
• 5.Institutions and celebrities fled, leaving buyers with lawsuits. Christie's closed its digital art department in 2025, Nike shut RTFKT and faced a $5M lawsuit, and Shaquille O'Neal paid $11M+ in settlements — a consistent pattern of hype, exit, and abandonment.
• 6.Blockchain technology survived but shifted toward real-world asset tokenization. Tokenizing property, private credit, and commodities reached $30 billion by Q3 2025 with BlackRock and Franklin Templeton involved, while the host draws a parallel between NFT mania and current LLM valuation hype.