After recently stating that 90% of NFTs (non-fungible tokens) will be worthless in the next three to five years, Fred Ehrsam, Co-Founder of cryptocurrency trading platform Coinbase, shook off the crypto audience. Ehrsam’s critique of NFTs comes amid when the electronic investment vehicle is generating a lot of buzz and its acceptance is spreading throughout the globe. “I go so far as to say that 90% of NFTs produced, they probably will have little to no value in three to five years.” the former Goldman Sachs foreign currency trader said, drawing a link between early online businesses from the late 1990s and NFTs.
NFT as seen through the eyes of Fred Ehrsam :
During a discussion with Bloomberg TV, Ehrsam stated that there was no difference between NFTs and other crypto ventures that sprang from overnight excitement. “People are going to try all sorts of things. There’ll be millions and millions of cryptocurrencies and crypto assets, just like there were millions and millions of websites. Most of them won’t work,” Ehrsam remarked. When it comes to digital money, Ehrsam points out “If crypto has taught us anything, it’s never to dismiss a good meme that couldn’t later manifest into more concrete progress,” by which he meant that the Shiba Inu dog-faced cryptocurrency Dogecoin — the digital currency that has propelled the cryptocurrency industry to unprecedented heights — should not be overlooked.
Given Ehrsam’s worries, the NFT craze has swept the world by storm, especially in the last year or two. The first non-fungible token (NFT) ever produced, a pixelated digital figure known as a CryptoPunk just sold for $1.47 million at a Sotheby’s auction (roughly Rs. 10 crores). The SketchAR app revealed last week that artists would be able to submit, mint, and sell their creations as NFTs. While the app has been supporting artists for four years, it lacked the ability to display artwork and monetize it as NFTs in the global digital arena. SketchAR is working on a solution right now.
In 2017, Ehrsam departed Coinbase, the crypto exchange that went public this spring with a value of $100 billion. He also co-founded Paradigm, a blockchain investment business. “Crypto is a nuanced issue, and that it’s possible the US gets crypto wrong. Today you have a lot of regulators whose job it is to mitigate risk and keep us all safe, and that’s very appropriate. At the same time, I think crypto is the next internet-sized opportunity for the United States.”
In response to concerns of cryptocurrencies’ environmental effect, he remarked that Elon Musk and Bill Gates will have to look into the matter more, and added his own opinion that using these digital coins and transfers in the future will be far more energy-efficient. He went on to say that it’s reasonable that there would be a lot of uncertainty at first. “I think they should examine the issue more closely … My personal view is it’s actually going to be a lot more energy-efficient to use these digital systems of value transfer over time. But it’s understandable that there’s a lot of confusion early [on].”
He went on to say that while the world does not change overnight, we will be able to witness the beginnings of exponential development that are now present. He added that in the future, we won’t need central currency or a centralized method to communicate with one another. “The world doesn’t change overnight, but you can see the seeds of exponential growth occurring already. So, I do think we will live in a future where for us to coordinate, we won’t need these centralized platforms today. That’s already true of financial services, in that you can be your own bank. You don’t need a central institution to hold your money anymore.”
Fred Ehrsam’s final verdict “History is yet to be written. My view is that it’s a very strong place to be, to have the largest mainstream brand trust not only with users but also with regulators, and that being that bridge into the crypto world is a great place to start.”