NFT Breaks Through the Winter: Technological Innovation and Regulatory Relief Foster New Opportunities for Digital Ownership

How Can NFTs Seek Breakthroughs in the Winter? Technology, Artificial Intelligence, and Regulations Open New Paths

At 3 PM, when most of the colleagues had finished their day's work, a 23-year-old young man was just starting his day. In his apartment in Asia, he rubbed his sleepy eyes, brewed a cup of coffee, and logged into Discord.

For the next 14 hours, until around 5 a.m., he will manage the NFT project with the co-founders, coordinating with artists in different time zones and interacting with a community of thousands.

In 2025, when most mainstream observers had regarded NFTs as a fleeting trend, the dedication of this young man seemed out of place. While his university classmates were seeking career development in AI startups or short video agencies, he and his team remained passionate about digital art ownership.

He is not fighting alone; some NFT communities are still making progress, seemingly indifferent to the winter of NFTs. The goals and communities of these projects are vastly different: some are dedicated to anime cultural heritage, some launch cute plush toys, and others promote a political cultural movement known as "web spirituality," but they all have one thing in common, which is NFT.

"People always say that NFTs are dead, but our community is still full of enthusiasm." The young man stated that their recent art competition attracted hundreds of entries from around the world, "Technology is advancing, and we are progressing as well."

This persistence is not an isolated case; despite the significant decline in NFT trading volume compared to the peak in 2021, the creator and collector community continues to thrive. The CEO of a trading platform stated that this evolution is exactly what we expected.

"If you look around, with the rise of artificial intelligence, there are many exciting things happening in the tech field, making it easier to create content and build software applications." He explained in a recent interview: "Our main argument is that cryptocurrency and blockchain are the key infrastructure for all current technological developments."

How can NFT find vitality in the winter? OpenSea CEO reveals three paths: technology, AI, and regulations

NFT Data

The raw data reveals a dramatic story: NFT trading volume has plummeted from a peak of over $3.2 billion per week in August 2021 to currently less than $100 million, a drop of 97% which may indicate that the NFT market has entered the final stages of a recession, but some see a more nuanced reality.

"At the beginning of 2021, some alternatives had already emerged for what NFTs represent." Someone explained that he was referring to the explosive growth of meme coins, which attracted billions of dollars in trading volume, "some of which have been absorbed by the meme coin craze because meme coins have stronger liquidity, are interchangeable, and allow for easier trading and deposits and withdrawals."

Many successful NFT projects continue to evolve by embracing their own ecosystem tokens, creating a hybrid model that combines the community characteristics of NFTs with the liquidity of fungible tokens. "A good example is that many NFT projects now include both tokens and NFTs simultaneously."

This market shift has occurred alongside fierce competition for dominance in the NFT market. The trajectory of a certain platform reflects this volatility, with its market share plummeting from over 70% in 2021 to 15% in 2022, and recently rebounding to 58% following the upgrade of its platform and the release of its ecosystem token.

Another significant change is that NFTs have become cheaper, not only due to the price collapse but also because the transaction costs of buying and selling NFTs have drastically decreased. "We now have faster, cheaper, and higher throughput blockchains. You can have a complete economy where an NFT costs only 50 cents, and even the rarest NFTs are priced at 50 dollars. Compared to 2021, the current ecosystem is much healthier, as the cheapest NFTs back then were at least 1,000 dollars, and even 5,000 dollars."

At the same time, related digital ownership models are flourishing, with "Counter-Strike" skins recently hitting an all-time high, with a market value close to $5 billion. Some attribute this success partly to its convenience: "If you purchase in-game skins for 'Counter-Strike', you don't have to worry about storage issues or wallet concerns."

How can NFTs find opportunities in the winter? OpenSea CEO reveals three approaches: technology, AI, and regulations

NFT in a Positive Regulatory Environment

Recent rulings, especially a landmark court decision between a certain company and a certain gaming company, will fundamentally change the accessibility of NFTs on mobile platforms. This ruling effectively ends the monopoly in the in-app payment sector and brings significant opportunities to the NFT market.

When asked about the impact of this ruling, someone enthusiastically responded: "We just released a new version of the public beta, which allows you to discover and trade any on-chain asset."

He explained that the court ruling directly addressed a major obstacle: "Our next plan is to introduce this service to mobile in the most pleasant way possible, allowing people to easily get started." He emphasized: "This ruling will greatly benefit this, as in-app purchase issues have been troubling us for a long time."

This change means that users will soon be able to purchase NFTs directly through the iOS app without having to pay high fees. Previously, some mobile applications did not support purchases because a 30% commission made their peer-to-peer market model "too costly." Some believe that the removal of these restrictions will lower the entry barrier, which is "greatly beneficial" for consumers, as they will be able to more easily experience NFTs on their mobile devices.

Some have stated that the regulatory environment for NFTs and cryptocurrencies has significantly improved. With the recent changes in the political landscape in the United States, many investigations into cryptocurrency companies have concluded. He pointed out that during the previous period of regulatory uncertainty, many smaller creators were hesitant to participate in the ecosystem.

How can NFTs find vitality in the cold winter? OpenSea CEO reveals three paths: technology, AI, and regulations

The Cultural Significance of NFTs and Digital Identity

The most striking point about NFTs is that they remain resilient amidst market fluctuations, reflected in their role in establishing digital identities and community memberships. Earlier this year, Ethereum co-founder Vitalik Buterin changed his profile picture to an NFT from a certain company, which sparked a strong reaction in the market, fully demonstrating this.

Someone observed: "Owning a digital asset, purchasing it, and then setting it as your social media avatar inherently indicates that you are part of this community, reflecting a shift in mindset."

He compared the CryptoPunks community to this phenomenon: "When you buy a CryptoPunk, you are immediately welcomed by this truly vibrant community... It really makes you instantly aware of what that person represents."

We have also witnessed the evolution of community members in projects like Pudgy Penguins. Pudgy Penguins was originally launched in 2021 as a chubby, mischievous little bird that couldn't fly, and has now developed into a mature consumer brand.

Today, the presence of Pudgy Penguins is seen on toy store shelves and in popular videos on short video platforms, and there are even ecosystem tokens based on a certain blockchain, with this year's trading volume soaring into the top ten. As the founder said: "Intellectual property is the 'Trojan horse' for the popularization of cryptocurrency." The journey of Pudgy from niche collectibles to mainstream peripheral products also confirms this argument.

At the same time, Azuki, which focuses on anime, also leans towards storytelling and fan collaboration. The founder describes Azuki's mission as "respecting the cultural heritage of anime while exploring new creator funding models." Like many other projects, it now has its own ecosystem token, with more than half of the token allocation given to its NFT holders, which "highlights how digital communities can collectively own IP development, from storylines to funding anime production."

How can NFTs find opportunities in the winter? OpenSea CEO unveils three paths: technology, AI, and regulation

NFT Technology Cycle

Some believe that the current state of NFT is part of the natural cycle that new technologies typically go through, "Any new technology goes through a very exciting period where people are interested in its use cases, and then there comes a period of frenzy, which is exactly what we saw in 2021," he said.

But usually afterwards, people will spend more time building infrastructure, use cases, and innovations, and I think that is what we have seen in the past few years.

This perspective is consistent with what we have seen in other technological revolutions, from the internet itself to mobile applications, where the initial hype is gradually replaced by a more sustained period of development, and true value begins to emerge.

Although early attention was primarily focused on digital art and collectibles, some believe that NFTs are part of a broader aspect of digital ownership, which will become crucial as our lives become more online. "We have evolved from a purely NFT market into a platform where you can discover, own, and trade any on-chain asset." He pointed out, emphasizing that the platform has already surpassed its initially narrow focus.

In fact, NFTs have been proving to us that they are more than just "NFTs": from Azuki's community-driven entry into the anime industry to Pudgy Penguins' collaboration with a toy series, new projects are strongly leaning towards the aspect of "online identity", such as a project shifting from PFP to banners and high fashion entities, which demonstrates the powerful potential of NFTs as online programmable IPs, rather than just digital JPEGs.

One particularly interesting emerging trend that some have discovered is the connection between physical goods and NFTs. "Many companies are now creating physical products presented in the form of NFTs," he explained.

He emphasized Courtyard, which "has generated substantial income and immense trading volume" by allowing people to trade rare Pokemon cards presented in NFT form and obtain actual physical items on demand.

"They are not very eye-catching, as they are not necessarily typical NFT projects, but they are a great example of the flexibility and practicality of NFTs." He said: "They are not necessarily pure digital collectibles or artworks; they can represent a wide variety of things."

How can NFTs find opportunities in the winter? OpenSea CEO reveals three paths: technology, AI, and regulations

NFT, Artificial Intelligence and Games

Some have said that the rise of generative artificial intelligence has created new opportunities for NFTs, "this makes content creation incredibly easy," he explained: "If you are a developer wanting to create a game, or if you are an artist wanting to create artwork, it has now become extremely easy."

With the development of these artificial intelligence applications, he believes that many developers will want to "have unique digital ownership in some way", and this is where NFTs can play a key role.

Interestingly, he does not believe that artificial intelligence poses a threat to the value of NFTs; rather, he thinks it enhances the importance of provable digital ownership. "For digital art, because it contains elements of human culture, I believe there needs to be a layer of provable digital ownership," he said.

He also pointed out that many exciting Web3 games are under development, including the blockchain-based trading card game Parallel. Many of these projects are integrating artificial intelligence, and despite market fluctuations, they continue to be developed and launched.

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DegenMcsleeplessvip
· 10h ago
I really envy this guy for still daring to go all in on NFTs.
View OriginalReply0
DuskSurfervip
· 07-25 19:55
Once again, the bull and bear cycle.
View OriginalReply0
RektRecordervip
· 07-25 19:52
It's so intense that even drinking coffee can't save it.
View OriginalReply0
GasFeePhobiavip
· 07-25 19:50
Staying up late to work, right? Those who understand, understand.
View OriginalReply0
GateUser-9ad11037vip
· 07-25 19:42
NFT never compromises, sticking to it to the end.
View OriginalReply0
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