The NFT industry in the UAE is projected to grow rapidly, with a 45.5% annual increase and reaching a value of $982.1 million in 2022, according to a recent report.
The market is expected to continue expanding at a CAGR of 32.1% during the period of 2022-2028, with the NFT spend value in the country rising to $4.75 billion by 2028.
This growth is driven by the increasing adoption of new technology and the entry of more entrepreneurs, businesses and celebrities into the industry.
The UAE is also becoming a global hub for NFTs as it is known as a desirable destination for doing business.
“Consumers are interested in buying into stories, in buying into experiences. When you’re buying a product you’re just buying the physical product. But when you are buying an NFT you’re buying a whole lot of things that are linked with it,” Arshad Zaheer, Senior Partner at YAAP, told Khaleej Times in an interview.
One of the key benefits of NFTs is that they are built on blockchain technology, which allows for tracking of ownership. This means that content creators can rest assured that their work cannot be copied or stolen.
Despite efforts by some countries to impose regulations on NFTs, the buying, selling, and creation of NFTs in the UAE has seen a significant increase. As a matter of fact, the Middle East and Africa region, and particularly the UAE, has seen a rise in NFT-related activities.
For example, in 2022, the Art Dubai fair, the largest contemporary art fair in the region, featured nearly 100 international and local art dealers and a digital collection from 17 platforms and galleries focused on displaying and selling NFTs.
The NFT market in the UAE has experienced significant growth in recent times, due in part to the emergence of new marketplaces that have made it easier for the public to buy, sell, and trade NFTs. Many players have entered the market, including NFT-based start-ups and cryptocurrency exchanges, and the presence of these marketplaces has contributed to the rise in NFT trading volumes and values, which is expected to continue in the coming years.
NFTs also have the potential for a positive social impact, as demonstrated by TOMS, an apparel company, which recently released an NFT of one of its iconic shoes, with proceeds from sales going towards the International Medical Corps. With smart contract technology, the benefits from the sale will continue with each re-sale of the NFT, unlike traditional sales.
According to Zaheer, the value of NFTs increases through scarcity, design, and social media buzz. He stated that since the advent of social media, brands have been able to build communities and this trend will continue to grow with the use of NFTs, as they amplify social causes on blockchain.
He also believes that the potential for NFTs is vast, as brands continue to explore ways to build communities and create value for their customers.
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