Like crypto-currencies, non-fungible stocks and tokens are highly speculative investments whose value is frequently arbitrary. As many people have learned the hard way over the past year, it is difficult to pick and choose which ones will increase in value. However, the world of finance will be revolutionized by NFTs and the blockchain technology they rely on.
Everyone was shocked in 2021 when collections of these images occasionally sold for millions. However, even ardent NFT advocates would concede that the NFT market needed a correction. However, only a tiny minority of investors saw a return on their investment. Many have suffered millions in losses on their NFT investments. The famous people who lost money in NFTs will be discussed in this article.
Top 5 celebrities who lost millions in NFTs
At the height of NFT’s multi-million euro sales last year, the famous YouTuber jumped on the bandwagon. Now it seems that this rush has cost him a small fortune.
An NFT that Paul bought for $623,000 is now worth only $10. But this NFT represents only a small part of the vast collection he assembled over the previous year, during which he spent more than $2.5 million. The decline in this NFT over time has been 60% from its peak.
Steve Aoki is an electronic music producer and DJ known for his EDM bangers. In addition, he has established himself in the crypto-currency community as a renowned creator and collector of non-fungible tokens.
However, these investments have not yielded the same level of success as his music. Aoki saw a sharp decline in the value of the assets he owned, including eight NFTs of Bored Ape and over a hundred NFTs in total. While diversification has helped him limit his losses, one of the NFTs “Doodles” which he bought in January for about $346,000 is now worth only $42,000, according to DappRadar estimates.
The American rapper, who spent $7.09 million on an NFT called Right-click and Save as Guy, holds the record for the most expensive celebrity NFT purchase.
But according to Open sea, the rapper also owns another non-fungible Crypto Punk token, which was purchased for US$1.1 million and is currently valued at $688,251.
The Brazilian soccer star, like many other sports figures, reportedly spent more than $1 million on two Bored Apes Yacht Club NFTs, which is considered one of the most coveted non-fungible chip collections, earlier this year.
Unfortunately, Neymar paid a high price to belong to this exclusive club. According to DappRadar, a website that tracks the value of NFTs, his two monkeys, which he bought in January for about $480,000 and $570,000, are now worth $153,000 and $171,000 respectively. The soccer player now stands to lose more than $700,000 on paper.
In October 2021, DJ Marshmellow, a world famous DJ, joined the NFT trend. For an estimated A$1.4 million, he bought KajuKing #1680. His non-fungible token is listed on OpenSea for $2137 a little over a year later. Between the two, there is an astonishing difference of $1.4 million
Almost 60% of NFT trading volume in 2022 was wash trading
According to a recent report, wash trades accounted for nearly 60% of non-fungible token trading volume this year. Wash trading is a type of market manipulation in which a trader buys and sells a security to simulate an increase in trading volume and activity in the market.
Wash trades, according to Dune, have gained traction in the crypto industry in 2019. However, it became relevant to the NFT space in 2022. Dune revealed that wash trades account for about 45% of all non-fungible token exchange volume on Ethereum. Although it accounts for $30 billion of that volume. OpenSea only accounts for 2.4% of wash trading volume and less than 1% of all transactions.