The Final Chapter and Rebirth of NFT: From Ruin to New Life

1. The End of NFTs

The last call of the NFT market seems to have come to an end. Recent token issuance activities have only stirred up a few ripples in the market. The once highly sought-after narrative has now become quiet, with almost no one paying attention.

10,000 PFP projects once had a beautiful vision: a moderately sized community could help a grassroots IP project reach the world. This is completely different from the way traditional IP projects operate. Traditional IPs typically require years of accumulation and significant financial investment to make these images resonate deeply and ultimately become a profitable gold mine.

NFT is completely different; its entry barrier is very low, and the speed of IP creation and assetization is quite fast. Creators only need to pay a small amount of Gas fees to sell their works on the platform, without the support of galleries, toy companies, or film companies, and without the need for a professional team. A new IP and artist are thus born.

However, with the "crazy nesting dolls" of certain projects and disastrous sub-series releases, the positioning of NFTs has gradually become clearer. It is not a form of equity or investment, but rather more like an expensive luxury item with accompanying membership benefits. Project teams hope that users will continuously purchase sub-series to support their subsequent IP development. This contradiction has sown hidden dangers: project teams understand that content development costs are high, but without developing content IP, they cannot survive. The frequent issuance of sub-series continuously drains the enthusiasm of OG series holders, tormenting every member of the community. Waiting for returns from content may take years, or it may never materialize. The rift begins to widen, and beautiful fantasies shatter with the decline in floor prices, leaving only various controversies.

2. The Ace MCN in the Trendy Toy Industry

If NFTs are viewed as luxury trendy toys for Generation Z, the reasons for their rise and fall become clearer. In an era dominated by fast food culture, a lack of content support is not necessarily a bad thing, as appearances alone can quickly attract buyers. Some NFT series feature artistic styles that resonate with specific groups, and driven by consensus, these grassroots-produced NFT series can also become market favorites. Some well-known trendy toys in the real world also lack content support but have become wildly popular due to their unique appearances.

However, trends are always fleeting. Without content as a value support, these IPs can become outdated at any time. Limited by the culture of the cryptocurrency sphere and the low success rate of NFT projects, project parties often continuously create derivatives around a single IP. But the reality is that before the core has taken shape, this trend has already passed.

Of course, there are some PFP projects that have sufficient content support, such as some Japanese NFTs. However, these projects seem to overlook the fact that the IP fan base is almost completely incompatible with the cryptocurrency circle. In addition, there are already too many traditional anime peripherals to choose from, so why would fans spend hundreds of times the price to buy a small image? More importantly, the future empowerment space for these NFTs is almost zero. Even if you buy an NFT of a well-known IP, you can only gain access to its metaverse project, which has nothing to do with the commercial benefits of the IP itself, and may even be seen as an outsider among the entire fan base.

In this case, PFP projects seem to have become a false proposition. So, do small images have any other way out? Some trendy toy companies may provide a different answer.

These companies often originate from small physical stores and achieve rapid growth by代理知名IP. When the copyright holders reclaim the exclusive agency rights, it instead encourages them to start building their own IP empire.

The idea of these companies is simple: create their own IP and build a brand that no one else can take away. By cooperating with designers to launch an independent trendy toy series, combined with the excitement of blind box gameplay, explosive growth has been achieved. This model of combining Japanese gacha with high-end trendy toys was also common in the later NFT boom.

However, why have many NFT projects failed while these trendy toy companies have welcomed a second spring? The answer may lie in the differences in their models. Successful trendy toy companies do not rely on a single IP, but instead create a whole wall of IPs. They have multiple proprietary IPs, exclusive IPs, and non-exclusive collaborative IPs with well-known brands.

Human preferences are always changing, and the lifespan of a single IP is limited. But what if you have hundreds of choices? Some trendy toy IPs have become popular worldwide, and the value retention of their associated dolls is akin to "plastic Maotai." The ideals of certain Web3 projects are ultimately realized in Web2, and this is not a coincidence.

We need to rethink what an IP business is, what the development path of NFTs is, and why some trendy toy companies can achieve such high success in the absence of content support?

Three, the Pragmatic Penguin

The success of certain NFT projects lies in pragmatism. NFTs themselves find it hard to create a technological gap; no matter how cleverly the minting process is designed, what ultimately presents itself is still an image. The real challenge for NFTs lies in the implementation of IP, which is hundreds of times more difficult than creating PFPs. Some projects aim to build a metaverse or anime, and while these ideas are cool, the initial costs require hundreds of millions in funding, so they can only seek support from the community.

In this highly compressed world, everyone wants to achieve results quickly. Holders want to profit rapidly, and project teams want to reach the top in one leap. Very few projects are willing to be grounded; ultimately, the more impatient they are, the harder they fall. Some projects, after going through turmoil, sell their projects at low prices.

After some new operators took over, they brought the project back on track with years of experience in physical marketing. They are truly building a brand and operating a company for NFT holders. Every step, from marketing to peripheral products to future game development, is solid and steady. The company can be profitable, and the holders can benefit. There is nothing particularly special about this; they are just doing what should be done. It has been proven that bottom-up IP can exist in Web3; however, there are too few project parties willing to lower their stance.

Four, Future Path

The path to success seems simple, but in reality, it is difficult. The next stage of development for PFP must break through the inherent logical framework of the cryptocurrency circle. To become the "Disney" of the Web3 era requires substantial accumulation. We need to rethink whether the scarcity of NFTs is counterproductive in the process of going mainstream. If NFTs are defined as trendy consumer goods, then a scale of 10,000 may be too limited; if they are defined as assets and fundraising methods unique to Web3, then IP still ultimately needs to be converted into physical consumer goods to fulfill its commitments to the community, rather than a bunch of strange sub-series.

Based on the unique culture of the cryptocurrency space and the attributes of NFTs themselves, it is also difficult to avoid a long-term focus on a single IP. How can we innovate based on existing PFPs? How can we expand a single project into an IP factory? This may require us to embrace some new concepts and introduce more technologies and gameplay.

The Significance of Issuing Tokens

The significance of issuing tokens for NFTs remains unclear to this day. This practice resembles the exploitation of lower-tier participants by those in higher positions, as well as the dilution of the original NFT's value. We can only understand it as a project seeking a convenient way to exit liquidity.

From the tokens of some well-known projects, they all seem like variants of air coins without exception. Their empowerment is often limited to staking for on-chain trading dividends, purchasing rights for items in virtual worlds, governance rights, and so on. Ideally, it should be a perfect cycle among holders, stakers, and developers. But in reality, it resembles a kind of air, trapped in a vicious cycle of falling NFT prices, declining mining revenues, and decreasing token prices.

For original NFT holders, although the tokens have taken away some dividends and rights, most of them received a large airdrop at the time of token issuance, so no one is complaining. However, in the long run, this is indeed a form of dilution, and the token distribution methods of certain projects are even more evident in terms of encroachment on interests.

Short-term popularity is certainly important, but the long-term sustainability of a project is even more critical. Don't let the issuance of tokens be the endpoint of the project.

Conclusion

In this fast-paced era of instant gratification, we have witnessed the rise of many emerging Web2 IPs. NFTs were supposed to thrive in this age, as they possess many irreplaceable characteristics. Four years ago, I viewed it as the "Moutai" of the digital age, but reality has proven it to be more like a "tulip." There are few willing to cultivate the ruins, but I believe that beneath the ruins lies the seed of the next blockbuster IP.