Japanese NFT market projects 53% growth despite crypto winter of DailyCoin

A recent study has revealed that despite the chaos, fear and uncertainty that has characterized the cryptocurrency market since May, the Japanese NFT market has maintained its growth, and is estimated to be worth $1.36 billion by the end of the year.

NFTs are notorious for rampant speculation and profiteering. However, the asset class has seen an improvement in terms of stability in the last quarter of the year due to civic engagement, healthy trading behavior and more.

Blockchain games and metaverse projects raised $534 million in October and November, with total in-game NFT trading volumes reaching $55 million, according to DappRadar. Reflecting these positive trends, the Japanese markets have also swelled.

Despite bearish sentiments and existing contagion such as FTX, the Japanese NFT market continues to show steady growth, projecting an annual growth rate of 38.7% until 2028.

Stay warm in the cold winter

In a Q3 report from Non-Fungible, NFT trading has struggled to be a profitable activity for most of the industry’s players, estimating a weekly loss volume of $50 million. However, current numbers are significantly better than the estimated weekly loss volume of $250 million in May.

Globally, in Q3 the NFT market has struggled to deliver positive results, with losses ranging from $1 million to $5 million per week, depending on the segment. The global NFT gaming sector projected $5 million to $8 million weekly losses in Q3.

But at the same time, DappRadar’s report has indicated a GameFi growth of over $320 million despite market conditions and events. Over 800,000 daily Unique Active Wallets (UAW) interacted with smart contracts in November.

The Japanese NFT industry has undoubtedly prevailed, growing by 53% in the current chaos. The industry projects an increase in NFT use value from $1.36 billion to $8.8 billion by 2028, according to the study.

The growing role of NFTs in Japan’s art and culture

Interestingly, while much of the Japanese population has typically been wary of cryptocurrencies and NFTs in general, an equal proportion have shown interest and actively contributed to the industry’s growth.

Although the NFT industry is still in its infancy, the market continues to attract interest from major global players to invest and establish the infrastructure.

NFTs help Japanese artists and creators connect and use technology to their advantage. Japan has a vibrant art culture, and NFTs take the initiative to reward artists who contribute to this culture by stimulating creativity.

Consequently, the study has shown that the Web3 game industry has a major role in the growth of the industry. Big Japanese game companies like Sony (NYSE: ), Square Enix and more have shared their interest in using NFT technology to create more products, games and fan experiences.

Government interest in the industry also serves a significant role in the success of the NFT economy. Prime Minister Fumio Kishida recently shared that his government is working to promote Web3 services, including NFTs and metaverse. The Japanese government’s digital transformation plan uses NFTs to solve various problems facing the country.

On the other side

• A global leader in entertainment and gaming, Sony recently filed a patent to use NFTs to track ownership of in-game assets.
• Japanese gaming powerhouse Square Enix released an NFT collection to celebrate the 25th anniversary of the iconic RPG, Final Fantasy VII.
• Crypto assets in Japan are subject to “Miscellaneous Income Tax”, which ranges from 5% to 45% on profits. A council tax of 10% is also added to this for all rates, ultimately leading to a maximum potential tax rate of 55%. Such hefty tax policies can often slow down a country’s crypto adoption rate. However, the NFT industry has continued to show impressive growth.

Why you should care

Japan’s economy is among the world’s top five in terms of purchasing power parity and nominal gross domestic product. The crypto industry has been influential in the country, showing impressive growth despite global market conditions. It is no surprise that the NFT sector in the country has outperformed the global market, especially with factors such as its rich art culture, gaming sphere and crypto-friendly government.

You might also like:

The city of Fukuoka is becoming the blockchain hub of Japan

See the original on DailyCoin