The adoption of NFTs has surged in recent years, with both crypto enthusiasts and traditional industries embracing this innovative digital asset class.
Although certain NFTs have previously sold for millions, the market has faced a significant decline alongside the wider crypto market.
Nevertheless, the NFT market is projected to reach a value of $230 billion by 2030.
A new study by CoinGecko and Blockchain Research Lab reveals the top reasons why people are buying NFTs, with utility and profit being the most significant factors.
The survey, which gathered data from 343 NFT and crypto users, ranked 11 reasons for buying NFTs based on their importance.
Utility emerged as the most crucial factor, with 77.6% of respondents considering an NFT’s intended function before making a purchase. The potential for long-term profit came in second at 76.1%, followed by gaining a stake in a venture or decentralized autonomous organization (DAO) at 72.9%.
Other high-ranking factors included enthusiasm for the technology (71.1%), community involvement (68.8%), and appreciation for the business model or artwork of the NFT collection (67.9%).
Disrupting established structures or industries ranked as the least important factor, with 59.5% of respondents listing it as a top reason for buying NFTs.
1. Utility and functionality
The study highlights a growing demand for NFTs with practical applications, moving beyond their initial appeal as digital collectibles.
With more diverse use cases emerging, such as digital art, virtual real estate, and in-game items, buyers are increasingly seeking NFTs that offer tangible benefits and integration with digital ecosystems.
2. Long-term investment potential
Long-term profit potential was another key motivator for NFT buyers. As some NFT collections experience exponential growth in value, investors are drawn to this alternative asset class.
Despite market volatility, a significant number of NFT buyers remain optimistic about their long-term prospects and the possibility of future appreciation.
3. Participation in Decentralized Autonomous Organizations (DAOs)
Many NFT buyers are motivated by the opportunity to participate in DAOs.
By purchasing NFTs associated with a particular DAO, individuals can gain a stake in the organization and influence its direction. This allows them to play an active role in the project’s development.
4. Enthusiasm for technology and art
Buyers who are passionate about the underlying technology behind NFTs or the creative expression in digital art are often more inclined to invest in these tokens.
Innovative business models and technological advancements within the NFT space can also attract potential buyers.
5. Community involvement
The sense of community that comes with owning a particular NFT is another significant factor driving purchases.
NFT collections often have dedicated online communities where token holders can discuss the project, share ideas, and connect with like-minded individuals. This aspect of community involvement can be a major selling point for buyers, providing a platform for social interaction and collaboration around shared interests.
