NFT space shows confidence amid collapse of FTX

Key points: 

• Even before the FTX crash, NFT collectibles were already feeling trading volumes down 98%. 
• Oscar Franklin Tan, an executive at NFT platform Enjin, is optimistic about the survival of the NFT space despite the FTX effect and a bear market.
• Tan emphasized that the field should refocus on how NFTs demonstrate acceptance of digital ownership, new models for content creators, and funding for content creation.
• Jamie Thomson, CEO of NFT game studio Vulcan Forged, commented that NFTs will survive with utility in mature markets.
• NFT artist Johnathan Schultz believes that the NFT needs to move beyond what he calls the “memeification” of things. That means building important projects and helping the space as a whole.

Even before the FTX crash, non-fungible token (NFT) collectibles were already feeling the effects of the crypto winter, with trading volumes down 98%. With the debacle of FTX, it seems that the final nail in the coffin has been hit in this once-thriving space. Still, industry executives are optimistic about the industry's recovery.

Due to the tight liquidity of the FTX exchange, a large number of user funds are stranded, and users take a roundabout way to withdraw funds. One of the methods of allegedly withdrawing funds is to purchase NFTs located in the Bahamas. Many community members criticized this method of circumventing bankruptcy laws, and even ridiculed the utility of NFT, painting a negative image of NFT.

However, Oscar Franklin Tan, an executive at NFT platform Enjin, doesn’t think that’s a fair summary. In an interview, Tan stated that while NFTs are used, other items can also be used. “This has less to do with NFT technology and more to do with this disparity among users in the Bahamas,” he noted.

The executive is also optimistic about the survival of the NFT space despite the FTX effect and a bear market. Tan emphasized that the field should refocus on how NFTs demonstrate acceptance of digital ownership, new models for content creators, and funding for content creation. He explained:

“Admittedly, there was a lot of hype and excessive exuberance for some models, but this is true with all new technology. The NFT space is sure to stabilize and consolidate around the strongest communities, then we will see a second generation of smarter, more sustainable NFT models.”

Tan emphasized that NFT recycling projects should focus more on benefiting and building their communities. Short-term speculation and unrealistic roadmaps must be avoided at all costs. Instead, they should have long-term sustainable value.

Many players in the NFT field also have this view. Jamie Thomson, CEO of NFT game studio Vulcan Forged, commented that NFTs will survive with utility in mature markets. The same cannot be said for NFTs based on speculation and whistleblower rights, Thomson told. But these types of NFTs “will suffer more in the hands of more frugal people” as users wait for a better market, the executive said. Thomson further stated:

“Less speculation, more mandatory utility. As with tokens, if the NFT is essential for a project’s functionality or user’s presence, then there is less concern for price furcations. In essence, a gaming item, access to certain features, access to added value.”

Meanwhile, NFT artist Johnathan Schultz believes that the NFT era is ending unprofitably. "So we're seeing more projects with more use cases and benefits," he said. Schultz also told that for space to survive, it needs to move beyond what he calls the “memeification” of things. That means building important projects and helping the space as a whole.

With FTX's NFT marketplace amid the company's implosion, NFT platform Ethernity founder Nick Rose Ntertsas offers advice on how to do better. In an interview with, Ntertsas said that FTX’s centralized exchange-based model has been shut down for its NFT platform. He explained:

“That model should have been democratized and transparent. NFTs should eventually go cross-chain and be interoperable, not siloed by one gatekeeper, something we’re working on and passionate about.”

Contrary to other opinions, Ntertsas believes that there is nothing that NFT projects should be concerned about because different projects have different goals. But the executive wants to see more projects challenging the space to “rethink what’s possible with NFTs.”