Is NFT Dead? A Guide to NFT Use Cases

What Is an NFT? An Overview of Its Features

NFTs (Non-Fungible Tokens) are a technology that issues a unique certificate for digital assets. Unlike conventional digital data—which can be easily copied or altered—NFTs allow for clear and verifiable ownership.

Based on blockchain technology, NFTs have enabled digital content to possess genuine, inherent value. For example, issuing an NFT for a digital artwork certifies its authenticity. Likewise, NFTs can be created for game items or tickets, enhancing their rarity and value.

NFTs are poised for use well beyond investment, with broad potential across industries. Here are some key NFT use cases:

• NFT Certificates of Issuance: Traditional certificates were vulnerable to forgery and alteration, but NFTs offer a much safer, more reliable alternative. Blockchain-based records ensure transparency and traceability.
• NFT-Based Hometown Tax Programs: NFTs allow for unique digital artwork or virtual experiences as rewards, providing new ways to showcase regional attractions and foster interactive exchanges with supporters.
• NFT-Based Crowdfunding: Creators issue NFTs representing their work to raise funds from fans in a new crowdfunding format. Participants back the project by purchasing NFTs and receive exclusive perks in return.
• NFT-Powered Gaming: NFT-enabled games let players own, trade, and sell in-game items or characters as NFTs. This gives in-game assets real-world value and enables players to earn as they play.

While NFT technology is still evolving, it is expected to play a major role in areas like real estate transactions and economic activity in the metaverse (virtual worlds). As the digital economy grows, so too will NFT applications.

Are NFTs Really “Dead”?

NFTs have become prominent as a technology for verifying ownership of digital assets such as art and in-game items. However, criticism remains, with some claiming “NFTs are pointless or over.” Understanding this debate requires an accurate read on how the NFT market has changed and where it stands today.

Fact: Many Low-Value NFTs Were Issued and the Hype Has Faded

Historically, vast numbers of low-value NFTs were created, and many suffered from poor liquidity, making them difficult to sell. This was largely due to confusion in the technology’s early days and bad actors taking advantage. As the market rapidly expanded, speculators jumped in, and many projects ultimately failed.

Recently, however, the initial NFT boom has ended, and conditions have shifted dramatically. As the market matures, only genuinely valuable projects remain, and development of a healthy ecosystem is underway.

Industry Perspective

Past research shows that most NFT projects have already failed, with many holders experiencing losses. On average, NFT holders face steep losses, and the average NFT lifespan is short. Notably, around one-third of NFT projects disappeared during peak periods—an all-time high failure rate.

A major NFT marketplace co-founder and CEO stressed the potential of NFTs in an interview, highlighting particular interest in gaming and physically-backed NFTs. The platform is prioritizing new use case expansion and emphasized the need to become a hub for all NFT types to capture the next wave of collectors.

New use cases are always emerging. Becoming the hub for all types of NFTs is critical to attracting the next wave of collectors.

— Co-founder and CEO, leading NFT marketplace

The platform supports NFTs tied to games and physical goods, and offers customizable collection pages. Industry insiders predict that the gaming sector will drive NFT adoption, making frictionless onboarding for gamers a top priority.

Despite the challenges, some companies do not view NFTs as obsolete. A leading US venture capital firm's crypto asset market report predicts that NFTs will become established digital brand assets, widely adopted by companies and communities alike.

Why NFTs Still Have Value

NFTs continue to hold value because of their core features:

• Scarcity: NFTs are recorded on the blockchain and can prove unique ownership. This technology gives digital assets scarcity on par with physical assets.
• Utility: NFTs serve practical purposes—such as in-game items or tickets—and function as more than collectibles.
• Community: NFT projects foster passionate communities and vibrant economies. Members with shared values support ongoing project growth through active engagement.

Many Japanese companies are now adopting NFTs. Beyond PFP (profile picture) projects, NFTs are used in hometown tax initiatives and crowdfunding. In the future, major corporations, government agencies, and public institutions are expected to follow suit.

Rather than fading away, NFT demand is expected to continue rising. NFTs are not merely a bubble—they offer technological potential to deliver societal value and will find use across many sectors.

NFTs Are Not Dead: Practical NFT Use Cases

Below are effective NFT use cases and real-world examples. As technology advances, NFT applications have broadened considerably, evolving from speculative assets into practical tools.

NFT Use Case #1: Community

NFTs act as membership passes to communities of like-minded individuals. In Japan, many NFT projects are built with community formation at their core.

For example, PFP projects such as CryptoNinja and LLAC have cultivated enthusiastic communities and host frequent activities. NFT holders gather on Discord or at offline events, and many projects allow holders to help manage the project itself.

Holding an NFT can bring the following advantages:

• Networking: Connect with others who hold the same NFT, meet people with shared interests and values, and build deep relationships.
• Information Sharing: Access the latest project news and exclusive content not available to the public—a major benefit.
• Idea Implementation: Leverage NFT IP to launch new projects or events, and collaborate with fellow community members on creative initiatives.
• Exclusive Perks: Enjoy special benefits and services for NFT holders, such as invites to exclusive events or early access to limited products.

Community features like these are essential to sustaining NFTs’ long-term value.

NFT Use Case #2: Hometown Tax Programs

Recently, hometown tax programs using NFTs have emerged as an innovative approach. NFTs offer a novel way to showcase local attractions and foster two-way exchanges with supporters.

An NFT hometown tax program gives donors NFTs as rewards, ranging from digital artwork to region-specific items. Unlike traditional physical gifts, digital content enables new value only NFTs can provide.

Municipalities across Japan are now offering NFT-based hometown tax programs. Notable examples include:

• Imabari City, Ehime: Offers NFT art inspired by Imabari towels, merging traditional local industry with digital technology for fresh regional PR.
• Izumisano City, Osaka: Provides NFT art based on the local mascot "Izumisano Daruma," successfully appealing to younger generations by digitizing local culture.
• Koka City, Shiga: Issues NFT art themed on ninjas, presenting local history in a new digital medium that attracts attention from Japan and abroad.

These initiatives hold significant promise as a new means of regional revitalization.

NFT Use Case #3: Crowdfunding

NFT-based crowdfunding lets creators issue NFTs for their works and raise funds from fans—a new twist on traditional crowdfunding. Fans support projects by buying NFTs and receive unique digital content or perks in return.

Compared to conventional crowdfunding, NFT-based models offer key advantages. Supporters become “co-owners” rather than mere donors, and since NFTs can be traded on secondary markets, they may also gain asset value.

NFT crowdfunding is gaining traction in a range of projects worldwide. Prime examples include:

• CNP: Japan’s largest NFT collection, CNP, used NFT-based crowdfunding to fund anime production, leveraging community backing for a large-scale project’s success.
• LLAC: The LLAC House building campaign raised over ¥10 million through NFT crowdfunding, far surpassing its target thanks to broad supporter participation.

Though still new, NFT crowdfunding is poised to further transform how creators and fans interact.

NFT Use Case #4: NFT Gaming

NFT games leverage blockchain to issue in-game items and characters as NFTs, which players can use, buy, or sell. Major gaming companies are releasing NFT and blockchain games (BCG) on blockchain platforms, driving heightened interest.

The key feature of NFT games is “Play to Earn.” In conventional games, in-game assets had no value outside the game. NFT games record assets on the blockchain, granting them real-world value.

Clear in-game uses drive natural demand, helping to secure liquidity as recognition grows. The entertainment factor of gaming is also expected to further NFT adoption.

Looking ahead, more game companies are likely to adopt NFT technology, accelerating transformation across the gaming industry.

What to Consider Before Buying NFTs

There are several critical points to consider before purchasing NFTs. Investing without proper knowledge or preparation can lead to significant losses.

Consideration #1: Define Your Purpose

Clarifying your purpose is key when buying NFTs. You may want to collect, invest with hopes for appreciation, or use them in games or art. The intended use will shape your approach.

If you purchase NFTs without a clear goal, you risk suffering losses from market swings. Investing without a clear purpose is essentially gambling.

NFTs also tend to have lower liquidity than other financial assets, so buyers may be hard to find when you want to sell. Always research the NFT’s use case and market value trends, and make informed, rational choices.

Recommended research points include:

• Reliability of the project team
• Size and activity of the community
• NFT utility and development roadmap
• Transaction history and price movement

Careful consideration of these factors will help you make better investment decisions.

Consideration #2: Invest Only Surplus Funds

NFTs are highly volatile assets. Many worthless NFTs have been issued, and some have suffered from poor liquidity and resale challenges.

While the situation has improved, NFTs remain riskier than stocks or Bitcoin, so caution is warranted.

Only invest money that you can afford to lose—never use living expenses or emergency funds for NFT investing. Even if your NFTs become worthless, ensure it will not disrupt your life.

Diversification is also essential. Spreading investments across multiple NFT projects helps reduce risk.

Always assess your risk tolerance before investing and keep within safe limits.

Summary: NFTs Aren’t Dead—Their Utility Is Expanding

This article explored whether NFTs are “dead.” NFTs are a technology for proving digital asset ownership, uniquely authenticating assets in ways not possible with traditional digital data.

Although many NFTs lacked substance or liquidity in the past, the environment has changed dramatically. Only valuable NFTs remain and core communities are forming around them.

As the market matures, NFT use cases continue to grow, from communities and hometown tax programs to crowdfunding and gaming—each generating unique value.

However, NFTs remain highly volatile compared to other investment assets, so it’s best to clarify your purpose and only invest surplus funds. Sound risk management is crucial.

NFTs are still developing, but their potential use cases will only increase as technology advances. New applications will emerge and NFT value will continue to rise.

We encourage you to explore effective NFT uses based on this article. With the right knowledge and understanding, the world of NFTs can offer new opportunities for value creation.

FAQ

What Is an NFT? How Does It Differ from Cryptocurrency?

An NFT, or Non-Fungible Token, is a digital asset with unique, individual value. While cryptocurrencies are interchangeable and can be swapped one-for-one, each NFT is distinct and cannot be exchanged for another. NFTs represent ownership of digital art or content.

Are NFTs Really Dead? What’s the Current Market Situation?

NFTs are not entirely obsolete. The speculative bubble has passed, but high-quality, community-driven projects continue to thrive. The market is in a consolidation and maturation phase, and NFTs with utility and genuine value are expected to gain further attention.

What Practical Uses Do NFTs Have? Can You Give Examples?

NFTs are used in digital art, in-game items, sports cards, music, and more. Features such as automatic royalty payments to creators on resales, access to exclusive content, and asset ownership in blockchain games are rapidly expanding practical use cases.

Do NFT Artworks Have Value? Are They Worth Investing In?

NFT art derives value from its scarcity and proof of ownership. Investment potential is high, and as creators gain recognition, the market is expected to grow through and beyond 2026.

How Are NFTs Used in Games and the Metaverse?

In games and the metaverse, NFTs serve as unique digital assets for players, verifying ownership of in-game items and characters, and supporting trading and sales. In virtual spaces, NFTs form the basis for asset management and ownership protection.

What Risks and Considerations Should I Know Before Buying NFTs?

When buying NFTs, confirm the project’s reliability, assess the risk of value loss, and verify platform security. Also, pay close attention to data permanence and wallet management.

What’s the Outlook for NFTs? What Does the Future Hold?

NFTs are set to grow rapidly, thanks to transparent ownership and efficient digital asset trading. As regulation and technology advance, adoption in the metaverse, gaming, and art markets will expand, with market size projected to multiply from 2026 to 2030.

How Are NFTs Different from Traditional Digital Rights Management?

NFTs use blockchain technology to guarantee digital asset uniqueness and authenticity. Traditional digital rights management focuses on copyright protection. NFTs offer ownership and scarcity, with smart contracts enabling automatic royalty distribution on secondary sales.