At Gary Vaynerchuk’s multi-day non-fungible token (NFT) conference “VeeCon” in Minneapolis, there was no visible sign of the market collapse that preceded the crypto-palooza.
‘Happy’ singer Pharrell Williams had just left the main stage after bestowing the virtues of Web 3.0 and telling the enthusiastic NFT collector crowd “you are changing the paradigm right now.” Nearby, a line of mostly men in their late 20s and early 30s waited patiently to buy whatever merch they could afford.
And yet, in the prior six weeks, more than $1 trillion in crypto assets had been wiped away while the value of NFTs fell more than 80% from their market peak.
For the serial entrepreneur and host of the festivities, the steep losses in the cryptocurrency industry merely vindicated his view: Vaynerchuk, or Gary Vee, as he’s known, had predicted this crash or “NFT Winter” on multiple occasions.
“I said it in August, I said it in July, and I said it in May,” Vaynerchuk told Yahoo Finance, “I saw this coming — that [a crash driven by short-term greed] is absolutely potentially what we’re in. It’s just starting, there’s a correction.”
Vaynerchuk, who founded VaynerMedia, VaynerSports, and a signature NFT collection called VeeFriends, claimed to be ahead of the curve on crypto as one of the original NFT evangelists. In his view, the recent correction is a healthy check to the excess speculation.
Crypto speculation “was as crazy as internet stocks in the late ’90s being worth $400 billion for Pets.com,” Vaynerchuk said, comparing the NFT boom to the dot-com bubble. “The internet was coming, it was gonna change the world. The valuations on Wall Street were overblown. The valuations on NFTs in this first year are overblown…but the fundamentals are real.”
“The macro is super right — NFTs are here forever,” he added, “the micro is wrong, that’s why we’re correcting.”
Crypto speculation “was as crazy as internet stocks in the late ’90s being worth $400 billion for Pets.com,” Vaynerchuk said, comparing the NFT boom to the dot-com bubble. “The internet was coming, it was gonna change the world. The valuations on Wall Street were overblown. The valuations on NFTs in this first year are overblown… but the fundamentals are real.”
“Why should a ticket be a QR Code? A ticket being an NFT that’s worth something after the game is much more realistic,” Vaynerchuk said.
Following the aforementioned crash, the shine began to wear off of celebrity endorsements that put crypto, NFTs, and Web 3 in the global spotlight, particularly those that aired during the most recent Super Bowl in Los Angeles, which was referred to as the “Crypto Bowl” due to the slate of crypto ad campaigns.
One New York Times article questioned the silence of celebrities who starred in crypto commercials, including Matt Damon, Gwyneth Paltrow, Reese Witherspoon, and Lebron James, during the market meltdown.
Vaynerchuk stated that the reporting was mostly lazy and pointed to his many warnings on the asset class.
“I think for celebrities, they have to be careful to who and what they endorse, what they support,” Vaynerchuk said. “But I think it’s ludicrous for people to blame them on the price. … Celebrities did not invade Ukraine, inflation was not celebrities and so the correction of the global economy has also had a direct impact on the crypto economy. And so we have to be thoughtful when we point fingers.”
While geopolitical events, rising inflation, and a plummeting stock market have driven down the value of crypto and NFTs, that hasn’t been the case for other collectibles.
A 1955 Mercedes recently smashed the world record auction price selling for $143 million, Andy Warhol’s ‘Marilyn’ sold for $195 million, the Macklowe Art Collection netted $922 million, and New York’s biggest art houses Christie’s, Sotheby’s, and Phillips earned more than $2.5 billion in sales so far this year.
In light of the disconnect, Vaynerchuk said that NFT prices are relative.
“They’re down from completely unsustainable gold rush numbers of January. They’re also so up from a year ago, and it’s not even close,” he stated. “And so this is what always happens. I was there when everybody wrote articles and said the internet was a fad.”
The enthusiasm hasn’t diminished for the group of several thousand passionate Vee friends, hundreds of whom stood in line for several hours for the chance to take a selfie and share a few words with Vaynerchuk.
The Web 3 disciples are here for the long haul. They, like Vaynerchuk, believe that although most projects will disappear, when the greed is removed, “the good stuff starts.”
Dave is an anchor for Yahoo Finance Live.
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