How can NFT find vitality in the cold winter? OpenSea CEO reveals three ways: technology, AI and regulations

At 3 p.m., as most of his colleagues slowly finished their workday, a 23-year-old man who calls himself “0xExceed” was just beginning his day in his apartment in Asia. He rubbed his sleepy eyes, made a cup of coffee, and logged into Discord.

For the next 14 hours, until around 5 a.m., he will work with his co-founders to manage their NFT project while coordinating with artists in different time zones and interacting with a community of thousands of people.

In 2021, such an arrangement might not raise eyebrows, but in 2025, when most mainstream observers have dismissed NFTs as a passing fad, 0xExceed’s dedication will seem out of place, and while his college classmates are pursuing careers at artificial intelligence startups or TikTok agencies, he and his team remain passionate about digital art ownership.

He is not fighting alone. NFT communities like Pudgy Penguins, Remilia, Azuki and Claynosaurz are still working hard, seemingly unconcerned by the NFT winter. The goals and communities of these projects are very different: Azuki’s mission is to "pay tribute to the cultural heritage of anime", while Pudgy Penguins has launched a large number of cute plush penguins in Walmart, and Remilia is promoting a political and cultural movement broadly defined as "cyber spirituality", but they all have one thing in common, that is NFT.

"People always say NFT is dead, but our community is still passionate." 0xExceed said that the company's recent "Pixel vs Pixel" art competition attracted hundreds of entries from all over the world. "Technology is developing, and we are also progressing."

This persistence is not an isolated case. Although NFT trading volume has dropped significantly from its 2021 peak, the community of creators and collectors is still thriving. Devin Finzer, CEO and co-founder of OpenSea, the world's largest NFT trading platform, said this evolution is exactly what we expect.

“If you look at the big picture, there’s a ton of exciting things happening in tech with the rise of artificial intelligence, and it’s becoming easier and easier to create content and build software applications,” Finzer explained in a recent interview. “Our main thesis is that cryptocurrency and blockchain are critical infrastructure for all of the tech that’s going on right now.”

NFT Data

The raw data reveals a dramatic story: NFT trading volume has plummeted from a peak of more than $3.2 billion per week in August 2021 to less than $100 million today. The 97% drop may indicate that the NFT market has entered the late stages of a recession, but Finzer sees a more subtle reality.

 NFT transaction volume of each chain

“There have been some alternatives to what NFTs represent in early 2021,” Finzer explained, referring to the explosion of meme coins that have attracted billions of dollars in trading volume. “Some of that has been absorbed by the meme coin craze because meme coins are more liquid, fungible, and you can trade and deposit and withdraw more easily.”

Many successful NFT projects have also evolved by embracing their own ecosystem tokens, creating hybrid models that combine the community characteristics of NFTs with the liquidity of homogeneous tokens. "A good example is that many NFT projects now contain both tokens and NFTs," Finzer explained.

This market shift comes amid intense competition for NFT market dominance, a volatility exemplified by OpenSea’s journey, which saw its market share plummet from over 70% in 2021 to 15% in 2022, before recently recovering to 58% following its platform upgrade and ecosystem token launch.

Another major change is that NFTs have become cheaper, not only because of the plummeting prices, but also because the cost of buying and selling NFTs has dropped significantly. "We now have faster, cheaper, and higher throughput blockchains. You can have a whole economy where an NFT costs only 50 cents, and even the rarest NFTs cost $50. The ecosystem is much healthier now than in 2021, when the cheapest NFT was at least $1,000 or even $5,000."

 Average selling price of top NFT collectibles

Meanwhile, related digital ownership models are thriving, with Counter-Strike skins recently hitting an all-time high, with a market value of nearly $5 billion. Finzer attributes this success in part to its convenience: “If you buy a skin in Counter-Strike, you don’t have to worry about custody, and you don’t have to worry about your wallet.”

NFTs in a positive regulatory environment

Fortunately for OpenSea, recent rulings will revolutionize the accessibility of NFTs on mobile platforms, particularly the landmark court ruling between Apple and Epic Games, which effectively ended Apple’s monopoly on in-app payments and created huge opportunities for NFT marketplaces like OpenSea.

When asked about the impact of the ruling, Finzer responded enthusiastically: “We just released the public beta of OS2, which is a brand new version of OpenSea that allows you to discover and trade any on-chain asset.”

Finzer explained that the court ruling directly addresses a major obstacle: "Our next step is to bring this service to mobile in the most enjoyable way possible so that people can easily get started." He emphasized: "Apple's ruling will be very helpful in this regard, because the in-app purchase issue has been bothering us for a long time."

 Legal staff pushes a cart with boxes of court documents in front of the U.S. District Court

The change means that users will soon be able to purchase NFTs directly through the iOS app without paying high fees. Previously, OpenSea’s mobile app did not support purchases because Apple’s 30% commission made its peer-to-peer market model "cost-prohibitive." Finzer believes that the removal of these restrictions will lower the barrier to entry and will be "hugely beneficial" for consumers, who will be able to experience NFTs more easily on mobile devices.

Finzer said the regulatory environment for NFTs and the broader cryptocurrency sector has improved significantly, with many investigations into cryptocurrency companies having ended following recent political changes in the United States, noting that many smaller creators were hesitant to participate in the ecosystem during previous periods of regulatory uncertainty.

The Cultural Significance of NFTs and Digital Identity

 Remilia Collective’s controversial Milady NFT was adopted by Vitalik Buterin this year

What’s most striking about NFTs is their ability to remain resilient amid market volatility, exemplified by their role in building digital identity and community membership, as evidenced earlier this year when Ethereum co-founder Vitalik Buterin replaced his avatar with Remilia Corporation’s Milady NFT, which caused a strong market response.

“The idea of owning a digital asset, buying it, and then setting it as your social media profile is a way of saying you’re part of a community, and that’s a paradigm shift,” Finzer observed.

He compared the CryptoPunks community to this phenomenon: “When you buy a CryptoPunk, you’re immediately welcomed into this really vibrant community… It really gives you an immediate sense of what this person stands for.”

We’ve also seen the evolution of community members in projects like Pudgy Penguins, which originally launched in 2021 as a chubby, playful flightless bird and has now grown into a full-fledged consumer brand.

Today, Pudgy Penguins can be found on toy store shelves and in popular videos on TikTok. There is even a Solana-based PENGU ecosystem token, which has jumped into the top ten in terms of trading volume this year. As founder Luca Netz said: "Intellectual property is the 'Trojan Horse' for the popularization of cryptocurrency." And Pudgy's journey from niche collectibles to mainstream peripheral products also confirms this argument.

Meanwhile, Azuki, which focuses on anime, also leans into storytelling and fan collaboration. Founder Alex 'Zagabond' Xu describes Azuki's mission as "respecting the cultural heritage of anime while pioneering new creator funding models." Like many other projects, it now has its own ecosystem token, with more than half of ANIME tokens allocated to its NFT holders, which "highlights how digital communities can co-own IP development, from storylines to funding anime production."

NFT Technology Cycle

Finzer believes that the current state of NFTs is part of the natural cycle that new technologies typically go through. "Any new technology goes through a very exciting period where people are interested in its use cases, and then there's a period of frenzy, and that's what we're seeing in 2021," he said.

But typically after that, it takes people longer to build out the infrastructure, the use cases, and the innovation, and I think that's what we've seen over the last few years.

This view is consistent with what we’ve seen in other technology revolutions, from the internet itself to mobile apps, where initial hype gradually gives way to a more sustained period of development during which real value emerges.

While the early focus has been on digital art and collectibles, Finzer sees NFTs as part of a broader layer of digital ownership that will become critical as our lives move increasingly online. “OpenSea has evolved from being just a marketplace for NFTs to truly being a platform for discovering, owning, and trading any on-chain asset,” Finzer noted, emphasizing that the platform has expanded beyond its initial narrow focus.

In fact, NFTs have been proving to us that they are more than just “NFTs”: from Azuki’s community-driven foray into anime, to Pudgy Penguins’ collaboration with a toy line, new projects are leaning strongly towards the “online identity” aspect, such as 0xExceed’s KazeCreations moving from PFP to banners and high-fashion entities, proving the power of NFTs as online programmable IP, not just digital JPEGs.

One emerging trend Finzer has found particularly interesting is the connection between physical objects and NFTs. “There are a lot of companies now creating physical products presented as NFTs,” he explains.

He highlighted Courtyard, which has “generated significant revenue and huge volume” by allowing people to trade rare Pokemon cards presented as NFTs and receive the actual physical item on demand.

“They’re less visible because they’re not necessarily your typical NFT project, but they’re a great example of the flexibility and utility of NFTs,” Finzer said. “They don’t have to be purely digital collectibles or artworks, they can represent a wide variety of things.”

NFTs, AI, and Gaming

Finzer said the rise of generative AI has created new opportunities for NFTs, “which makes content creation incredibly easy,” he explained: “If you’re a developer and want to develop a game, or you’re an artist and want to create a work of art, it’s now easy.”

As these AI applications develop, Finzer believes many developers will want to “somehow have unique digital ownership,” and this is where NFTs can play a key role.

Interestingly, Finzer does not believe that artificial intelligence will pose a threat to the value of NFTs. Instead, he believes that it enhances the importance of provable digital ownership. "For digital art, because it contains elements of human culture, I think a provable digital ownership layer is even more necessary," he said.

Finzer also noted that many exciting Web3 games are in development, including the blockchain-based collectible card game Parallel, and that many of these projects are integrating artificial intelligence and are continuing to be developed and released despite market volatility.

Another notable example of NFTs powering a gaming experience is Claynosaurz, whose gaming experience was launched in partnership with Gameloft, a major game publishing studio known for hit titles such as the Modern Warfare series, The Amazing Spider-Man, Gods of Rome, and Despicable Me: Minion Rush.

Additionally, the project has been recognized by the 2025 Collision Awards, a prestigious event that honors excellence in animation across all fields including film, television and games. Established in 2024 by industry leaders and organizers of the long-running Telly Awards, the Collision Awards brings together judges from major studios such as Disney, Pixar and Nickelodeon to evaluate submissions from around the world.

Claynosaurz’s 3D dinosaur characters won awards in multiple categories, demonstrating how NFT projects can produce animations of a quality comparable to traditional entertainment giants, rather than the pixelated images that NFTs are typically associated with.

NFT: The Future of Digital Ownership

Despite the ups and downs of the NFT market, Finzer remains convinced that digital ownership will become a fundamental part of our increasingly online lives.

“NFTs are going to play a key role in the future of society,” Finzer insisted. “I think as more and more people move to the digital world, there’s going to be a need for a digital ownership layer.”

As artificial intelligence continues to advance, gaming ecosystems grow more complex, and more of our identities become tied to digital assets, NFTs may be able to truly realize the vision promoted by Finzer and other early advocates, not as speculative assets but as essential infrastructure for a digital future.

By Boaz Sobrado (Forbes)

Translation: Jonathan