Jack Dorsey’s NFT Tweet: One Year Later

In March 2021 ( a year ago already! ), the entrepreneur Sina Estavi added his part to building the citadel of buzz around NFTs by buying the first Tweet in history, written by Jack Dorsey, founder of Twitter, under the form of an NFT.

At the time, this sale made a lot of noise and raised many questions: How can you buy a Tweet? Who is willing to spend $2.9 million on a digital asset, which is only the vehicle for another digital asset? What does it mean to “own a Tweet’s NFT?” »

Why is Jack Dorsey’s Tweet not reselling at the expected price?

In short, the NFT sphere was on fire for a few weeks, then this sale fell into oblivion… until its owner decided to put it back on sale a year later, and the auction did not take off.

• What lessons can be learned from this phenomenon?
• What does the “Jack Dorsey Tweet” NFT say about what the NFT industry has been through over the past 12 months?
• How does this sale reflect a profound change at the heart of the markets and in the perception that the general public has of NFTs?

The context, during the initial sale

Let’s put ourselves in the context of the time. The world was emerging from a more than gloomy 2020 and was just beginning to see the end of the Covid tunnel. NFT technology was starting to get talked about alot and not a week went by without another sensational new announcement bringing the subject of NFTs back to the fore.

We are in early March 2021, the World has already heard of “Punks in JPGs” which sell for several hundred thousand dollars. Even more recently, the art industry experienced an unprecedented earthquake with a digital artwork that sold as an NFT for $69 million by the American artist Beeple.

We are then in total euphoria around NFTs. We don’t really know what they are yet, but one thing is certain: there is a lot of money in circulation and these digital assets open up perspectives never seen before. This industry phase is an explosive mix of experimentation and gold rush. You must give it a try! After all, who knows what will become a high-value NFT?

The “NFT” then appears as the digital magic wand that transforms any digital object into an object of great value.

It was in this context of boiling markets that the first Tweet in history, published by Jack Dorsey, found itself on sale. Note in passing that the Tweet was put up for sale by a third party and not by Jack Dorsey himself.

Jack announced that he will accept the highest bid on March 21, 2021. Sina Estiva won the auction, and the NFT was sold for $2.9 million.

Where is the NFT Market today?

The least we can say is that the landscape has changed quite a bit since March 2021 and March 2022. Let’s just look at some of the elements that have profoundly changed the face of the industry in one year:

• Excessive speculation has led to a slowdown in trading and an increase in reselling at a loss (see Yearly NFT Market Report 2021 – Pro version)
• Public opinion is losing interest in this ultra-speculative digital asset class whose value proposition of 80% of NFTs in circulation leaves something to be desired.
• We observed an obvious saturation of the NFTs markets: the volume of NFTs in circulation increased from 14.2 million in February 2021 to 32.1 million a year later, an increase of 126%. (Source: NonFungible.com exclusive data)
• The war in Ukraine has brought a complex geo-political context which naturally takes center stage, and leaves less room for the coverage of NFTs sales.
• Last but not least.. “Cent” The marketplace on which the Tweet was initially sold finally had to close its doors in February 2022 due to “Rampant, fakes & plagiarism”. Thus, the NFT of Jack Dorsey’s first Tweet is put back on sale on OpenSea , in the midst of millions of other NFTs. Without any particular setting, lost in the mass, but despite everything tainted by the aura of a marketplace that has failed to limit suspicious activities.

In other words, we are now in a situation where the NFTs markets have suffered enormously from excessive speculation, where the markets have been saturated with low-value assets, where the general public is beginning to doubt the real value that NFTs can bring and have more eyes on the Russian-Ukrainian conflict than on trading NFTs.

No more Beeple sales at $69 million in the landscape to make buyers believe that any NFT can resell for tens of millions of dollars.

A final element contributes to this phenomenon: the current owner of the NFT considers that it cannot be sold for less than $50 million…or x17 the price paid one year ago. This very approach to selling contributes to this feeling of over speculation around NFTs.

The asset has not yet had time to convince of the inner value it conveys, in 12 months, and its owner is already trying to resell it 17x a price which already seemed high at the time, in full age of mad sums invested in NFTs.

Would the sale have gone differently if its owner had not announced from the outset that his NFT could only be sold for at least $50 million?

Less fantasy, more concrete evidence.

“The sky is the limit” was the philosophy of the NFT industry a year ago. Nobody had any notion of what could be a legitimate price for an NFT, the benchmarks were all under construction.

“Stay safe” seems to be the new philosophy in 2022, vis-à-vis the trading of digital assets.

Well, everyone is asking the question, so it is necessary to provide some answers:

Was or was not Jack Dorsey’s tweet worth and still worth $2.9 million?

All we can say at this point is that this unique and highly experimental digital asset is not finding a new buyer as easily as expected. The fact that it offers very low liquidity, and that 99.9% of the population cannot or does not want to buy this Tweet at this price does not necessarily mean that it is not worth the price paid initially. We are not talking here about a simple collectible card, but about a particularly rare asset.

The context of the sale (closure of the previous marketplace, conflict in Ukraine, slowdown in the NFT markets, etc.) are obviously factors that are the complete opposite to the context one year ago and do not help to sell the asset.

Is this tweet currently worth $2.9 million? Obviously not.

Could it one day be resold at this price or even more expensive? Time will tell, but let’s remember that the NFT markets have surprised us on many occasions and no doubt will continue to do so in future..!