NFTs are not extinct: they are maturing — from a speculative frenzy to a pragmatic structural shift

“NFT is dead” — This recurring argument over the past two years has recently been reignited by the cancellation of NFT Paris events. However, when we shift our focus from media headlines to GitHub commit records, from secondary market trading volumes to actual on-chain protocol calls, a completely different picture emerges: monthly sales still stabilize at $300 million, developer activity hits new highs, and Web3 giants like Animoca Brands are channeling resources into real asset tokenization. This reveals an counterintuitive truth: the NFT market has not vanished; it is undergoing a silent transition from adolescence to adulthood — shifting from speculative games chasing quick profits to pragmatic projects building lasting value. Beneath the market’s surface calm, there is a deep expansion in infrastructure development and use case exploration.\n\nSource: Coindesk\n\nData doesn’t lie: the silent revolution in trading structures\n\nOn the surface, the decline of NFT total market cap from hundreds of billions of dollars at its peak to current levels is indeed disheartening. But behind macro data lies the code of structural change. During the 2021-2022 bull market, trading was mainly concentrated on profile picture (PFP) projects, whose value was almost entirely dependent on community narratives and speculative sentiment. Today, on-chain data reveals a more diversified landscape: in-game assets, digital identity credentials, membership passes, and tokenized real-world assets (RWA) are accounting for an increasing share of transactions. This shift is especially evident in trading patterns — holding periods are significantly longer, trading frequency decreases, but assets are more tightly bound to specific use cases.\n\nTaking Dune Analytics data as an example, although trading volume of blue-chip projects has sharply declined, activity in game-specific NFT markets has steadily increased. More importantly, the holding time for these trades has extended markedly — from days or even hours to weeks or months. This transition from “trade-oriented” to “use-oriented” is a core sign of market maturity. As Siu, co-founder of Animoca Brands, said, “Collectors are still driving the market,” which actually points to a healthier pyramid structure: at the top are high-value digital art and collectibles, while at the bottom are vast quantities of utility assets, together forming a complete economic ecosystem. This layered structure gives the market resilience against speculative bubbles.\n\nTechnological evolution: from static images to programmable assets\n\nBehind the structural change in the market is a profound evolution of the NFT tech stack. CryptoKitties in 2017 and BAYC in 2021 were mainly based on the ERC-721 standard, essentially pointers storing image metadata on the blockchain. Today’s NFT technology has far surpassed this static model, moving toward more dynamic and programmable forms. This technological evolution is not a gradual improvement but a fundamental paradigm shift, redefining the boundaries of digital asset possibilities.\n\nThe emergence of the ERC-6551 standard marks a watershed. Known as the “NFT wallet standard,” this innovation allows each NFT to have its own smart contract wallet. This means NFTs are no longer passive collectibles but can actively hold other assets — including tokens, other NFTs, and even execute complex on-chain operations. Game developers can now design role NFTs that hold weapons and armor NFTs, automatically earn token rewards after completing tasks, and use these rewards to trade equipment on decentralized markets. This composability and interactivity transform NFTs from “butterfly specimens” in display cases into “living organisms” within active ecosystems, creating unprecedented user experiences and economic models.\n\nMeanwhile, dynamic NFT technology is maturing. Based on on-chain or oracle data, NFTs’ appearance, attributes, or rights can change in real time. Imagine an NFT representing carbon credits that visually varies according to actual emission reductions; or a membership NFT whose privileges automatically adjust based on participation levels. These breakthroughs are turning NFTs from simple proof of ownership into complex, programmable rights carriers. This shift not only expands NFT functionality but also builds a dynamic bridge between digital assets and real-world value.\n\nUse case diversification: four emerging pragmatic tracks\n\nAs technological capabilities expand, NFT use cases are rapidly diversifying into several clear tracks. This diversification is not market fragmentation but an inevitable trend of ecosystem maturation, with each track corresponding to specific user needs and technical solutions.\n\nGaming and virtual economy assets are currently the most active areas. Large multiplayer online games are issuing key assets — land, characters, equipment, resources — as NFTs. Unlike traditional game items, these assets are truly owned by players, tradable in secondary markets, and even usable across different games. The decline of Axie Infinity is not a failure of the game NFT model but a paving of the way for more sustainable economic designs. Next-generation game projects are building more complex and balanced economic systems, where NFTs are not just collectibles but essential tools for participating in the game ecosystem. These systems, through carefully designed incentives and scarcity management, foster more durable and engaging user participation.\n\nDigital identity and reputation systems are finding unique value in a crypto world dominated by anonymity. Verifiable, persistent identity credentials are becoming highly valuable, with NFTs serving as the perfect carriers for such digital identities. Educational institutions can issue verifiable degree NFTs; employers can distribute skills certification NFTs; DAO organizations can issue contribution proof NFTs. These credentials are tamper-proof, verifiable, and fully controllable by users, forming the foundation of Web3 social graphs and reputation systems. This decentralized identity layer not only solves trust issues of traditional networks but also creates possibilities for new social and economic interactions.\n\nTokenization of real-world assets (RWA) shows the most promising development prospects. Partial ownership of real estate, shares of artworks, authenticity proofs for luxury goods — assets traditionally with low liquidity or high verification costs — are now being expressed digitally through NFTs. This tokenization not only enhances liquidity but also enables automated revenue sharing and governance via smart contracts, blurring the lines between physical and digital worlds. Although this field faces complex challenges like legal compliance, asset custody, and on-chain real-world data integration, breakthroughs here could unlock a trillion-dollar market.\n\nMembership and access control are redefining permission management. From private clubs to software subscription services, NFTs are changing how access rights are issued and managed. Holding specific NFTs can unlock exclusive content, event tickets, product discounts, or community voting rights. This model creates a more direct and programmable creator-fan economy, offering holders potential value appreciation. An ownership-based access model is fostering new community forms and business paradigms.\n\nInsights for builders: choosing the right tech stack in this new era\n\nFor developers building or planning NFT projects, this transitional period is both a challenge and an opportunity. The choice of tech stack will directly impact the project’s long-term viability, and today’s ecosystem offers more diverse and mature options than ever before. Developers need to make prudent, forward-looking technical decisions based on their project’s specific needs and long-term vision.\n\nStandards selection becomes a core consideration in architecture design. While ERC-721 remains foundational, ERC-1155 is suitable for batch minting game assets, and ERC-6551 for complex, composable assets — these emerging standards should be incorporated early in the design process. Correct standard choices can greatly influence future functionality and user experience, determining the project’s technical ceiling. Developers should deeply understand each standard’s design philosophy and applicable scenarios rather than simply follow trends.\n\nChain and layer choices directly affect user experience and operational costs. While Ethereum mainnet’s security and network effects remain unmatched, Layer 2 solutions offer better user experience and cost efficiency for high-frequency, low-value assets like game items. Cross-chain interoperability should also be part of the long-term roadmap, considering the future multi-chain ecosystem. Developers need to balance security, cost, and ecosystem richness to find the best fit for their project.\n\nStorage strategies determine asset permanence and accessibility. Fully on-chain NFT metadata and media, though costly, provide true permanence and censorship resistance. For high-value art or critical identity credentials, this may be worthwhile. For most use cases, decentralized storage solutions offer a good balance. Storage decisions should consider cost, performance, and long-term reliability, especially as data volume grows.\n\nEconomic model design is key to distinguishing sustainable projects from short-term hype. The most important shift may be from “how to create scarcity to drive prices” to “how to design utility to generate lasting demand.” Sustainable NFT projects should think like designing a micro-economy: how are assets created? How do they circulate among users? How to prevent over-inflation or deflation? How does practical value accumulate over time? Answers to these questions will determine whether a project can survive market cycles.\n\nThe vast world after coming of age\n\nThe cancellation of NFT Paris may mark the end of an era — an era where NFTs were mainly social media identity symbols and speculative tools. But this does not mean the end of NFTs themselves; rather, it may be the beginning of a necessary coming-of-age. As market noise subsides, true value creators gain a larger stage and clearer vision.\n\nWhen the market phases out projects that rely solely on FOMO and hollow promises, space is left for genuine builders. From Animoca Brands’ shift toward RWA tokenization, to developers exploring ERC-6551, and collectors viewing NFTs as long-term digital art holdings, these seemingly disparate phenomena point in the same direction: NFTs are moving from the fringes of culture to the center of mainstream applications. This transition is not a sudden revolution but an incremental evolution, requiring coordinated development of technology, market, and society.\n\nFuture NFTs will appear less frequently in panic headlines of financial news and more in players’ game inventories, creators’ membership programs, and enterprise supply chain systems. Their value will no longer solely depend on how much the next buyer is willing to pay but on what functions they can perform, what rights they represent, and what communities they connect. This shift in value foundation will fundamentally change the dynamics of the NFT market and the behavior patterns of participants.\n\nThis silent transformation may not generate headlines like those of 2021, but it is laying the groundwork for a more solid, diverse, and useful digital asset economy. For true builders, when the noise subsides, it’s time to start building seriously. Those who can grasp technological trends, understand user needs, and design sustainable economic models during this transition will lead the next cycle and drive the industry toward a more mature and valuable future.