In 2021 former Twitter CEO Jack Dorsey’s first-ever tweet was auctioned as an NFT – The First-Tweet NFT. The NFT sold for a whopping $2.9 million and was bought by a Malaysian-based Iranian entrepreneur Sina Estavi.
Jack Dorsey’s First-Tweet NFT loses 99% value
However in April this year, Estavi put up his priced possession for sale at a bidding price of 14,696 Eth (approximately $50 million). This was after the embattled CEO claims he was arrested when he visited his native Iran and detained for nine months. A situation that ran his blockchain firm aground. Moreover, the auction of Jack Dorsey’s first-tweet NFT turned out to be an embarrassing outing for the high-priced string of digitized words. The famous NFT did not get any bids above $280. And this represents a drastic 99% drop in the value of the high-priced NFT.
Other Notable Celebrity collections affected
The iconic NFT is not alone in this embarrassing turn of events. The price drop also affected Doggy, an NFT collection minted by popular American rapper Snoop Dogg. The once high-priced NFT got the highest bid of 0.0743Eth (approximately $210) when it was auctioned last month. And this also represented a major shortfall from its previous high valuation.
Bids for Jack Dorsey’s First-Tweet NFTs still for thousands of dollars
So far, the Iranian crypto entrepreneur has not received any bid beyond $14,000 for the NFT. A major shortfall from its previous valuation of $2.9 million. This drastic drop in value could be attributed to the slowdown of the NFT market. Which is part of an industry-wide drop in performance.
The reason for the drop in value
What could be the reason for the crash in major NFTs and NFT collections? According to Gaurav Somwanshi, CEO of EmerTech Innovations. NFTs derive their valuation either from their utility or by mere sentimentality where people invest with the hope that the prices will rise in the future. Furthermore, Somwanshi believes that the market is currently filtering NFTs. Meaning that those collections that derive their value from sentimentality will be hard hit because they lack artistic value or utility.
Furthermore, Zach Friedman, Co-Founder of blockchain firm Secure Digital Markets also added that only NFTs with utility will stand out in the coming days. He said in an interview with Wall Street Journal that “The ones that continue will be utility focused for sure”.
So in the coming days, NFTs that will survive the brutal market onslaught will be those with real-life utility.