NFTs are digital files that contain paintings, pictures, songs, movies or video games which use Blockchain technology to keep track of the ownership of the original file.
Some of these files such as, “Everydays: The First 5000 Days”, Nyan Cat, “Deal With It” sunglasses, and the first tweet of Jack Dorsey, the co-founder and CEO of Twitter "Just setting up my twttr", 3:50 PM, Mar 21, 2006 were put up for auction and sold for millions of dollars!
While there is an exponential growth in the NFT market, which is calculated to be $44 billion for 2022, its technology is environmentally unfriendly due its massive use of electricity. For example, it is estimated that the blockchain (Ethereum) network which supports the NFT market uses the same amount of electricity as the country of Denmark in one year.
There are also great concerns for the uncontrolled and unpredictable NFT pricing that could have a bubble burst. Central Bank of India defines NFTs as yet another Ponzi Scheme, which is "an investment fraud that pays existing investors with funds collected from the new investors."
Together with "Metaverse", "Augmented Reality- AR" and "Virtual Reality-VR" we must cautiously approach the NFT market. It is possible that some people who are well informed of the pros-and-cons of the NFT market will make a lot of money at these early stages, while others may lose a lot. Thus, a very conservative approach is strongly recommended in this area.