The past two decades have seen multiple new tech trends emerging. There’s the late 1990 dot-com boom, which welcomed the 2000 dot-com bubble. Some of the investing trends in the timeframe include artificial intelligence (AI), blockchain tech, and cryptos. Meanwhile, the most recent one is on the non-fungible tokens (NFTs).
Non-Fungible Tokens Explained
Non-fungible tokens are one-of-a-kind virtual asses that are unique and not interchangeable (non-fungible). Having an NFT related to a specific virtual asset means the holder has all ownership rights, and that info stays on the blockchain network.
Some of the notable NFT sales within the previous year include the first Jack Dorsey’s tweet (sold at $2.9 million); Mike Winklemann’s digital print, also Beeple (sold for $69 million at Christie’s auction house); and the Doge meme (sild at $4 million).
Joining the NFTs Bandwagon
While NFTs enjoyed booming popularity, they attracted multiple household brands, targeting to benefit from the growing market and advertise their products. Digital collectibles and various brands have joined the NFT bandwagon to attract more clients while attempting to launch unique NFTs for their goods.
Among the companies include food brands such as Taco Bell & Campbell Soup (NYSE: CPB), Yum! Brands (NYSE: YUM), McDonald’s (NYSE: MCD), plus fashion brands such as Nike (NYSE: NKE), Dolce & Gabbana, Louis Vuitton, and Gucci.
McDonald’s introduced its first-ever non-fungible token (in October) by launching limited NFTs known as MCNFT as it cheered the McRib return to its menu. The 28 October announcement saw McDonald’s stock gaining around 1%.
Taco Bell joined the craze before McDonald’s, auctioning 25 NFT GIFs on Rarible in March 2021. Rarible is an NFT marketplace. Yum! Brands’ share barely reacted after joining the NFT collectibles space.
Meanwhile, Nike used another route to join the NFT market. The brand jumped into the bandwagon by acquiring RTFKT (pronounced artifact), a non-fungible token collectibles studio. Nike announced the deal in December and didn’t improve the firm’s share price, declining marginally a day after Nike disclosed the action.
Muted Response from Stock Market
The muted reactions by stocks after companies joined the NFT space showed traditional investors are yet to delve into the NFT hype. They might perceive these virtual assets as a short-term marketing strategy.
Though the connection between stocks and NFTs remains complicated, the New York Stock Exchange surprisingly showed interest in the new investing way. NYSE filed a proposal to register the “NYSE” term for the NFTs market (in February), suggesting that NFTs investments are at an infancy stage.
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