The digital asset market will always be first and foremost, one thing. A market. Behind all the fluff and hype and fud and nonsense, we have something that at its core we are still very familiar with. Exchange markets have existed for thousands of years. As long as we have ascribed value to things, an exchange market has existed in tandem with that value. Certain things lose value, and certain things gain value, but the one thing that is absolutely certain is that every asset, regardless of what it is, has at some point experienced both movements.
It wasn’t until the Dutch tulip mania of 1636 that mankind really began to experience what’s known as a speculative bubble. All of a sudden, imported Persian tulips had become the talk of the town, people would spend what they would otherwise spend on a house just to get the rarest one. It sounds completely ridiculous now, but it is more than arguable to say that our current market is far more ludicrous than some imported flowers could ever be. It seems now like everything is in a bubble, cars, Pokemon cards, art, jewelry, and of course, digital assets.
It is not a stretch to presume that a bulk of those Hollanders who had traded fortunes for flowers were likely not rabid botanical enthusiasts interested in creating the best garden in town. No, especially in the context of the (relatively, for the time) safe, invasion free 17th century Calvinist Netherlands, it is a rather safe bet that those tulips were purchased with the intent of reselling for a radical markup. Sure, you had noblemen and women who just wanted something fancy for their lapel, but at that point in history there was nowhere on earth friendlier to short term investors and profiteers than the Low Countries.
What does all this have to do with NFT’s one may ask? It is in the title of this piece, and I’ve failed to touch upon them up until just now. Well, perhaps compare the Netherlands at the tail end of their golden age to the modern day Internet at the tail end of its “free” age. Shortly after the collapse of the tulip bulb bubble in the Netherlands, that country would face a multi pronged invasion from all the great powers of Europe, making the concept of any sort of prosperity a distant memory. Now, back to today, where we appear to be on the precipice of massive regulations in the digital asset space. Between the rampant dollar dominance primogeniture bias of the US federal reserve, the whispers of widespread cryptocurrency regulation in India, the world's largest free country, and a rising 10 year treasury yield curve, why is it now amidst all this that we see an out of nowhere craze around little digital blockchain artpieces? Surely the business savvy Dutch understood the jealous French would maybe like a piece of their prosperity as they bought and sold depreciating and very mortal temperate zone plants amongst each other. The answer to me, it seems, is obvious. It’s a last hurrah mindset. People are not stupid and very rarely in history do things happen without the savvy of society having an ominous sense in their gut for what is come. Ironically, it is exactly this sense of impending doom that seems to drive people, myself included, to want to trade as many little pixelated pikachus as possible. If I can make quick money easily now, I surely won’t be able to do so in 2 or 3 years, right? Well, you never know. The Dutch Bulb bubble popped years before their golden age ended, perhaps as a result of those trading out of disaster-impatience being lured into a false sense of security by time?
Perhaps, in 6 or so months when our ATMs still have cash in them, our bellies are still full of food and our children aren’t making tiktoks in Chinese world war 3 trenches, our nerves will be eased enough to look ahead a bit more long term. Perhaps people will start to believe traditional markets are the real way forward after all, and people begin talking real estate or precious metals again. Or perhaps, this anxiety never dies down, people remain desperate to “make it” and we see even more frivolous pumps and dumps, right before a meteor strikes. No one can truly know, but in the context of understanding the present, one must be conscious of history.