One of those investors is Tyler, 35, a property manager from Florida whose family runs a small trucking company. He put together about $12,000 with the help of his family to buy NFTs after Floyd Mayweather touted an obscure NFT project on Twitter earlier this year.
"What I need everybody to do right now: Go get a Bored Bunny NFT," said Mayweather in a video posted on his account. "You're hearing it from the one and only Floyd 'Make That Money' Mayweather."
The NFT project Mayweather was promoting was a series of images of rabbits in a style similar in nature to other more popular NFT lines, such as the Bored Ape Yacht Club, that helped fuel a boom in NFT projects last year.
Unfortunately, both the Bored Bunny and the Bored Ape Yacht Club NFTs are now worth significantly less. For his part, Tyler said the investment has left him financially crippled. (Related: The biggest economic crash America will ever experience is coming, warn multiple financial experts.)
Thanks to the ongoing inflation crisis and the general collapse of the American economy, Tyler is now struggling to afford groceries and gas for his car. He blames Mayweather and other celebrity promoters of NFTs for receiving payouts from NFT makers and then moving on "while everybody who scraped by to invest in their futures got robbed."
The team behind Bored Bunny promised in marketing materials that investors could make twice, five times or even 10 times the value of their initial investment. Its mint price, or the price of the NFT upon initial release, was 0.4 ethereum (about $1,504 at the time). Its current floor price now sits at 0.05 ethereum ($99 as of press time).
The massive drop in the price of Bored Bunny NFTs is emblematic of the general collapse of the NFT market.
According to the NFT data resource website NonFungible, the sale of NFTs fell to a daily average of about 19,000 in the first week of May. This represents a 92 percent decline from a peak daily average of about 225,000 in September 2021.
The number of active NFT wallets has also dropped by 88 percent to about 14,000 in the first week of May from a high of around 119,000 in November last year.
The Bored Bunny and Bored Ape Yacht Club NFTs are not the only NFT lines that have fallen significantly in value.
An NFT of Twitter co-founder Jack Dorsey's first tweet sold for $2.9 million in March 2021. Earlier this year, the buyer, Sina Estavi, CEO of a Malaysia-based blockchain company, put the NFT up for auction. It did not receive bids above $14,000.
Another buyer who purchased an NFT curated by rapper Snoop Dogg, titled "Doggy #4292" paid about $32,000 in ethereum for it. The buyer recently put the NFT up for auction with an asking price of about $25.5 million worth of ethereum. The highest current bid for the NFT is 0.0743 ethereum ($147) as of press time.
Many celebrities like Mayweather and Snoop Dogg who leaped at the chance to promote NFTs to their fans did not disclose that they were paid to do so and also refused to inform their fans of the serious financial risks involved with NFT purchases.
"The messaging from these celebrities is like the 21st century equivalent of 'let them eat cake,'" explained Bonnie Patten, the executive director of consumer advocacy group Truth in Advertising.
According to Patten, these celebrities and the NFT teams that pay them are mixing the "incredibly volatile" NFT market with the lack of regulations surrounding influencer marketing, which can only lead to disaster for many people. "It has the potential to financially wreck vulnerable people who look up to them."
Learn more about the state of the American market at Bubble.news.
Watch this explainer video going into detail about what NFTs are and how they are just scams to part people from their money while providing them with essentially nothing.