Ark Invest CEO Cathie Wood said Tuesday that digital property rights related to non-fungible tokens (NFTs) and decentralized finance (DeFi) that have underpinned the emergence of Web3 “are going to become incredibly important.”
“DeFi has taken off and we’re impressed at how robust the ecosystem has been,” Wood said on CNBC’s “Squawk Box,” adding that the “token revolution” surrounding NFTs is “most in its infancy.”
NFTs — unique digital assets, like artwork and sports trading cards, that are verified and stored using blockchain technology — exploded in popularity in 2021. People create, collect and trade NFTs for millions of dollars, some with the hopes to profit in the future. But experts are still skeptical that NFTs are a good investment.
Speaking at a TechCrunch talk on climate change last week, Bill Gates described the crypto and NFT phenomenon as something that’s “100% based on greater fool theory,” referring to the idea that overvalued assets will go up in price when there are enough investors willing to pay more for them.
The billionaire Microsoft co-founder joked that “expensive digital images of monkeys” would “improve the world immensely,” referring to the much-hyped Bored Apes.
The surge in NFTs is still fairly new, but massive amounts of money have already exchanged hands among collectors. Since 2017, for example, NFT collectibles have generated over $6.2 billion in sales while digital art has generated over $1.9 billion, according to NonFungible, which tracks historical sales data of NFTs.
“We do believe that digital property rights, which is what NFTs represent, are going to become incredibly important,” Wood said, adding that her economic background has taught her the value of property rights when it comes to lifting people out of poverty.