Charlie Lee, inventor of the major cryptocurrency Litecoin (LTC), believes the continued surge in popularity of the non-fungible token (NFT) industry has a lot to do with the first coin offering (ICO) of 2017.
Lee provided at least five similarities between the 2021 NFT popularity and the 2017 ICO mania, comparing both to the 2013 altcoin craze in a tweet on Tuesday.
According to the Litecoin creator, all three cryptocurrency phenomena look very similar in that they are easy to create “without barriers” and simple to understand and explain. Lee noted that NFTs, ICOs, and the 2013 altcoins also bear a great deal of similarity in terms of adoption – as they all “brought tons of new people into crypto” or earlier.
Much like the high prices and pumps of altcoins in 2013, ICOs and NFTs are associated with massive hype and the fear of missing out. “Few will hold and have value,” and most people did not own or will not own them, concluded Lee.
Lee previously voiced some bold criticism of the NFT industry, claiming in February that NFTs have “no cost to manufacture.” “Because of the near-zero cost of creating another NFT, the market will eventually be flooded with NFTs from artists trying to capitalize on that craze. The supply will overwhelm the demand and prices will eventually crash, ”predicted the Litecoin developer.
Lee isn’t the only one who thinks NFTs are the new ICOs as many crypto enthusiasts have recently drawn parallels between the two main concepts in the crypto industry. Michael Goldstein, President of the Satoshi Nakamoto Institute, also tweeted on Monday: “NFTs are the ICOs of 2021.”
Andrew Kang, a crypto investor and co-founder of Mechanism Capital, also took to Twitter Tuesday to discover that NFTs are becoming increasingly popular with celebrities who may be “kidding all their fans,” meaning they are just looking for profits .
NFTs represent a new way of buying and selling art and other media digitally, and have indeed recently caught the attention of well-known celebrities, including Canadian musician Grimes and Linkin Park rapper Mike Shinoda. Celebrity endorsements appear to make another solid parallel between NFTs and ICOs, as a number of ICOs in 2017 were largely celebrity sponsored, including American record producer DJ Khaled and American actor Steven Seagal.