In a "base case" scenario, Galaxy Digital's research arm predicts that the nascent Bitcoin non-fungible token (NFT) market will reach a market capitalization of $4.5 billion by March 2025.
Bitcoin NFTs, or Ordinals, have garnered a lot of attention since the launch of the Ordinals protocol in late January, enabling users to write data such as images, PDFs, videos and audio into a single satoshis — each representing 0.00000001 bitcoin . NFT giants like Yuga Labs are even getting in on the hype. On Feb. 28, the company behind the $4 billion Bored Ape Yacht Club announced a Bitcoin-based NFT project called “TwelveFold” in recognition of the Ordinals movement.
In a new report published March 3, Galaxy researchers analyzed the potential growth of Bitcoin NFTs, making estimates “conservatively based on the current size of the Ethereum NFT market” and its growth rate over the past few years. The report offers three market capitalization forecasts covering bearish, fundamental and bullish scenarios based on the firm's analysis.
Check out Galaxy’s baseline analysis, which outlines that if Bitcoin NFTs can “scale to mainstream NFT culture like PFP [profile pictures], memes, and utility projects,” the market cap should increase to $4.5 billion.
The researchers also note that the $4.5 billion forecast is also based on "the rapid development of inscription awareness and the marketplace/wallet infrastructure that is already present today." In a bear market scenario where Bitcoin NFTs do not enter the mainstream NFT market and take market share away from Ethereum, Galaxy estimates that Bitcoin NFTs could still be worth $1.5 billion based on current interest levels and supporting infrastructure.
On the bright side, Galaxy researchers estimate that the Bitcoin NFT market could be around $10 billion if it offers a unique use case while providing strong competition to Ethereum NFTs. At the time of publication of the report, more than 250,000 Ordinals had hit the market. The researchers emphasized the importance and utility of Bitcoin NFTs, stating: "Adding massive data storage with strong availability guarantees opens up a variety of use cases, many of which are only just beginning to be explored, including new types of decentralized software or Bitcoin scaling technologies. Even NFT use cases alone, however, have the potential to greatly expand Bitcoin's sphere of cultural influence."
