Non-Fungible Token (NFT) Market Outlook (2024 to 2034)
The uniqueness of non-fungible tokens is one of the key factors contributing to their increased demand. They are built on blockchain, which ensures their connection to unique data and thus demonstrates the ability to add value. The global non-fungible token (NFT) market is poised to reach US$ 51.4 billion in 2024 and climb at a noteworthy CAGR of 23% to end up at US$ 407.7 billion by 2034.
DLTs (distributed ledger technologies), such as blockchain, etc., are some of the newly developed technologies, which are expected to pose threats to conventional business practices. Earlier business models depend on sluggish and expensive intermediaries for building confidence between two parties. Constant advancements in DLTs are projected to result in the creation of concepts, which are anticipated to reduce and simplify the price of exchanging value. Furthermore, a distributed ledger is generally used for representing values by tokenization of almost everything, such as digital as well as physical assets.
Non-fungible tokens are becoming popular as cryptographic tokens, which represent a one-of-kind technology. Art, in-game items for online games, commercial real estate, sneakers, plane tickets, or university degrees are some of the popular examples of NFTs, which are generally available in digital or physical form. Owners of NFTs let respective owners confirm their ownership and authenticity. The number of unique IDs of non-fungible tokens matches either the original issuer of a respective item or the service with authenticity checks, therefore resulting in businesses or individuals purchasing and selling products significantly.
- Worldwide demand for non-fungible tokens for commercial use is projected to accelerate at a CAGR of 22.3% and reach a market valuation of US$ 277.2 billion by the end of 2034.
- East Asia is forecasted to account for 23.1% of the global non-fungible token market share by 2034-end.
- Demand for non-fungible tokens in Japan is expected to increase rapidly at 23.6% CAGR from 2024 to 2034.
| Report Attribute | Detail |
|---|---|
| Non-Fungible Token (NFT) Market Size (2024E) | US$ 51.4 Billion |
| Forecasted Market Value (2034F) | US$ 407.7 Billion |
| Global Market Growth Rate (2024 to 2034) | 23% CAGR |
| Market Share of Physical Assets (2034F) | 67% |
| North America Market Share (2034F) | 24.3% |
| South Korea Market Growth Rate (2024 to 2034) | 23.9% CAGR |
| Key Companies Profiled |
|
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What is Responsible for Rapidly Expanding Non-Fungible Token Market Size?
“Surging Penetration of Internet and Smart Devices Stimulating NFT Demand”
With the development of high-speed network connections, an increased demand for smart devices is encountered. In the past few years, a soaring demand for smartphones, tablets, laptops, and bring-your-own devices across commercial workplaces and institutions has been experienced. Therefore, growing developments in blockchain technologies are leading to increasing requirements for non-fungible tokens. After the creation of NFT in 2014, there has been a noteworthy increase in the NFT trade, which is estimated to have a significant impact on market growth.
“Easy Access to Digital and Physical NFTs”
NFTs are being used prominently for creating a completely new class of collectibles as noticed in CryptoKitties. It is possible to purchase a tokenized version of an individual’s beloved sports celebrity or star. Further, it is assisting conventional collectors, who are planning to tokenize their coins, baseball cards, or stamps. Numerous platforms provide the facility to tokenize digital or physical accessories. Various advanced services are utilized by the platforms for creating non-fungible tokens. They translate a digital identity into some tangible tags, which a product owner transfers or keeps.
Which Challenges are Projected to Limit Demand Growth for Non-Fungible Tokens?
“Lack of Technology Infrastructure and Lack of Uniformity in Government Regulations”
NFTs have multiple legal frameworks based on the jurisdiction. The separation of non-fungible tokens and cryptocurrency legislation is one of the points of commonality. A lack of clear legislation related to assets underpinning an NFT is adversely impacting market growth. In addition, there are some countries, which equate Blockchain games with certain change games that link NFTs with strategy games. These legislative disparities are expected to create the implementation of different projects. Thus, an absence of uniformity in regulations is set to create challenges against market growth.
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How are Startups Contributing to Non-Fungible Token Market Growth?
“Efforts by New Market Players to Making Metaverse a Reality”
Metaverse is considered a vision of the internet-enabled virtual world, where individuals interact with digital assets through AR (augmented reality), XR (extended reality), and virtual reality (VR). Constant efforts are put into the evolution of blockchain technology. A newly updated report by Fact.MR, a market research and competitive intelligence provider, asserts that NFT is estimated to serve as a revenue model for Metaverse in the coming decade.
Metaverse contains digital avatars, which are expected to enable NFT to have direct access to digital avatars and real-time identities. NFTs find application in multiple metaverse use cases, including socialization, transactions, and interactions.
Country-wise Insights
North America is forecast to hold 24.3% share of the global market by 2034, as mentioned in the recently updated report by Fact.MR. The presence of some of the prominent market vendors including Larva Labs, Dapper Labs, OpenSea, Cloudflare, etc., is projected to generate lucrative opportunities in the region.
Will the United States Retain its Dominance in the Global Market?
“Rising Demand for Non-fungible Tokens with Presence of Advance Digital Infrastructure”
| Attribute | United States |
|---|---|
| Market Value (2024E) | US$ 5.5 Billion |
| Growth Rate (2024 to 2034) | 23.5% CAGR |
| Projected Value (2034F) | US$ 45.2 Billion |
The United States is evaluated to account for a45.6% share of the North American market by the end of 2034. The country is one of the homes of well-established digital infrastructure systems around the world. A significant number of NFT companies are operating in the United States. Some regulations are implemented by the new SEC (Securities and Exchange Commission) in the country for NFT trade, which is anticipated to have a position impact on market growth.
Why are Providers of Non-Fungible Tokens Thriving in China?
“High Penetration of Electronic Devices and Digital Technology”
| Attribute | China |
|---|---|
| Market Value (2024E) | US$ 5.6 Billion |
| Growth Rate (2024 to 2034) | 23% CAGR |
| Projected Value (2034F) | US$ 44.7 Billion |
China is approximated to hold 47.5% share of the market in East Asia by 2034-end. Penetration of electronic devices and digital technology is positively influencing non-fungible token market trends in the county. In addition, an increasing number of large internet companies along with the proliferation of NFT startups trying to enter the market are having a positive impact on market growth. These new market players are focusing on offering advanced services for NFT end users.
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Category-wise Insights
An increased requirement for the artwork category is witnessed in the global market offering personal non-fungible token rights. A part of the work in the NFTs artwork is recorded on the blockchain as crypto art. It secures ownership and identity rights.
Which Non-Fungible Token Asset Type is Gaining Widespread Prominence?
“Increasing Popularity of Physical NFTs with Ability to Prove Authencity”
| Attribute | Physical Assets |
|---|---|
| Segment Value (2024E) | US$ 37.04 Billion |
| Growth Rate (2024 to 2034) | 22.1% CAGR |
| Projected Value (2034F) | US$ 273.16 Billion |
Non-fungible physical tokens are projected to capture 67% share of the global market by 2034. The ability of these tokens in proving provenance and authenticity is projected to be their key benefit. Moreover, physical NFTs eliminate their requirements for middlemen from transactions, thus giving sellers and buyers monetary rewards and freedom. A link to recurring royalties of physical NFTs ensures a cut to sellers every time an asset changes its hands.
What Makes Non-Fungible Tokens More Popular in the Commercial Sector?
“Increasing Utilization of NFTs across Various Sectors”
| Attribute | Commercial |
|---|---|
| Segment Value (2024E) | US$ 37.04 Billion |
| Growth Rate (2024 to 2034) | 22.3% CAGR |
| Projected Value (2034F) | US$ 277.2 Billion |
The commercial sector is calculated to hold 68% of global market revenue share by the end of 2034. The growing use of NFTs in multiple sectors, including healthcare & medicine, real estate, etc., is estimated to widen opportunities for market players. In the healthcare sector, they are used for information storage, such as imaging and lab results, patient history, etc. Patients are estimated to have easy access to their health records and data transparency in clinical care, which further helps in the improvement of medical research.
Competitive Landscape
Leading NFT providers are focusing on new product launches to enhance their business scope and improve their potential for revenue generation.
For instance :
- Cloudflare, in April 2021, introduced a novel API, which takes an ERC-721 contact address and token ID and then sets it on a video. This is estimated to help in the streaming of every video, which is represented with a non-fungible token.
- Dolphin Entertainment announced Creature Chronicles: Exiled Aliens launch in November 2021. This is the first generative NFT collection of the content studio.
Key players in the non-fungible token industry are Ozone Networks, Inc., Art Blocks, YellowHeart, LLC., Cloudflare, Inc., The Sandbox, CryptoKitties, Takung Art Co., Ltd., Dapper Labs, Inc., Semidot Infotech, Dolphin Entertainment, Inc., Rarible, Foundation, PLBY Group, Inc., Gemini Trust Company, LLC., and Onchain Labs, Inc.
Segmentation of NFT Market Research
By Asset Type :
- Physical Assets
- Digital Assets
- Metadata
By Category :
- Artwork
- Collectibles
- Domain Names
- Gaming
- Identity
- Memes
- Metaverse
- Music & Media
- Real-world Assets
- Sport Items
- Tickets
- Virtual Items
By End Use :
- Personal
- Commercial
By Region :
- North America
- Europe
- East Asia
- Latin America
- Middle East & Africa
- South Asia & Oceania
