Big Investment Coming In For NFTs: Enter Amundi And Jefferies

Europe’s largest asset management firm with over two trillion euros of assets under management, Amundi, are setting their sights on offering NFTs under their asset portfolio.  

Speaking on the topic of NFTs, Amundi’s asset manager had this to say on the digital assets:  

“Ultimately, we cannot rule out that NFTs will also become investable assets […] and end up being ranked in the real assets category […]  In which case investors should gradually become interested in them as a diversifying asset and value creator (beyond the purely speculative).”

Amundi and Digital Artwork NFTs

The NFT market has been soaring since 2021 generating more than $23 billion in trading volume as reported by Forbes.  It is for this reason that Amundi’s chief investment officer Vincent Mortier sees digital art and collectibles as the most promising area within the space:

“Storage is much easier; you can track it, you can show it. There are some merits,” he said. “Some artists are doing artwork only for the NFT market. This section of the market has some legs and is investible.”

Testament to this is the fact that in March 2021 the artist ‘Beeple’ aka Mike Winkelmann sold a digital image for $69.3 million which made it the most expensive digital asset ever.  How did it fetch such a price?  As we develop into an ever changing digital art space there are significant opportunities to take advantage of which could make traditional art a thing of the past and here’s one reason why:

This art piece is actually 5,000 pieces of digital art that are created and posted every single day over a 13 and a half year period.  So it’s like having a new art piece every day for over 13 years.  It’s features like this that paints, or pixelates, a world away from traditional still artwork.

And just a month after this sale, the fine art broker Sotherby announced a collaboration with Pak, a digital artist, to sell his NFT digital art collection for $16.8 million.

It is this sort of significant evidence that supports digital art as a lucrative market that has sparked Arumundi to become so bullish on NFTs in this form and this can be testified through the following from Amundi:

“Some artists solely create work for the NFT market.  This market segment has some legs and is worth investing in.” 

Jefferies and Virtual Real Estate NFTs

But, it’s not only Europe’s largest asset management company that is bullish on NFTs.  American investment bank, Jefferies, are also just as bullish on NFTs and for good reason. 

Despite the bloodbath in the cryptocurrency market since the new year, the market for NFTs is thriving.  According to The Block Research, trading volume in NFTs has x3 just in January to $6.86 billion from its December volume of $2.67 billion.  

American investment bank Jefferies has forecasted an NFT market cap of more than $35 billion for the year 2022 and over $80 billion come 2025.  This came from a report published by Stephanie Wissink, a Managing Director at Jefferies.  

The bank puts this increased adoption largely down to virtual land plots in metaverse projects like The Sandbox and Decentraland.  Companies and celebrities are digitally marketing, raising awareness, and extending brands virtually through these metaverses.  In November 2021 there was a huge rush into digital real estate for which NFTs are the building blocks.  This was only the start of the digital real estate era too and a trend that is set to continue into 2022 and beyond.

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