Bleeding Edge Newsletter: The non-fungible token (NFT) market is one of the hottest spaces in the blockchain industry right now. It is a new asset class that I’m monitoring closely. These are digital assets that are cryptographically secured and authenticated on a blockchain.
But with NFTs selling for millions of dollars, there’s no doubt this market is highly speculative. That’s led a lot of people to question it. Is this just a fad and a bubble? Or is this a legitimate asset class?
I’m on record saying that NFTs represent a digital leap in the collectibles industry. This is a market that may be running hot, but it’s only going to grow. And an early stage venture capital (VC) round that just happened suggests that some savvy investors agree with me.
Andreessen Horowitz – one of the most successful VC firms in history – just backed a $23 million Series A funding round for a company called OpenSea.
OpenSea is the world’s largest marketplace for NFTs. We can think of it as the Amazon of the space. Consumers can find virtually any NFT they could possibly want. Digital art, trading cards, comic books, real estate in virtual worlds, Pokémon, and more items are posted for sale on OpenSea’s platform.
The fact that Andreessen Horowitz was willing to back this upstart marketplace speaks volumes about how the firm views the NFT space.
And if we look at the list of other investors in OpenSea’s Series A round, we will see some other big names: billionaire entrepreneur Mark Cuban; Naval Ravikant, the founder of venture investing site AngelList; Coinbase’s former chief technology officer (CTO), Balaji Srinivasan; and even Tim Ferriss, author of the popular book The 4-Hour Workweek. Each invested alongside Andreessen Horowitz in OpenSea.
These are some of the savviest investors in the blockchain space. And they are betting big money that NFTs are here to stay. It’s important to note that these guys are usually early on a trend, but they are typically right.
I’ll be the first to say that there will be a lot of hiccups and some bad actors in the NFT space in these early days. But that’s normal for new industries during their earliest stages of development.
The big picture – the leap to digitization – makes me very confident that the NFT market is already experiencing exponential growth. And that makes OpenSea a company that we need to follow going forward. Let’s add it to our early stage watchlist.