PARIS: A slew of celebrity endorsements helped inflate a multi-billion dollar bubble around digital tokens over the past year, but cryptocurrencies are crashing and some fear NFTs could be next.
NFTs are tokens linked to digital images, “collectable” items, avatars in games or property and objects in the burgeoning virtual world of the metaverse.
The likes of Paris Hilton, Gwyneth Paltrow and Serena Williams have boasted about owning NFTs and many under-30s have been enticed to gamble for the chance of making a quick profit.
But the whole sector is suffering a rout at the moment with all the major cryptocurrencies slumping in value, and the signs for NFTs are mixed at best.
The number of NFTs traded in the first quarter of this year slumped by almost 50 percent compared to the previous quarter, according to analysis firm Non-Fungible.
They reckoned the market was digesting the vast amount of NFTs created last year, with the resale market just getting off the ground.
Monitoring firm CryptoSlam reported a dramatic tail-off in May, with just $31 million spent on art and collectibles in the week to May 15, the lowest figure all year.
A symbol of the struggle is the forlorn attempt to re-sell an NFT of Twitter founder Jack Dorsey’s first tweet.
Dorsey managed to sell the NFT for almost $3 million last year but the new owner cannot find anyone willing to pay more than $20,000.
Molly White, a prominent critic of the crypto sphere, told AFP there were many possible reasons for the downturn.
“It could be a general decrease in hype, it could be fear of scams after so many high-profile ones, or it could be people tightening their belts,” she said.
The reputation of the industry has been hammered for much of the year.
The main exchange, OpenSea, admitted in January that more than 80 percent of the NFTs created with its free tool were fraudulent — many of them copies of other NFTs or famous artworks reproduced without permission.
“There’s a bit of everything on OpenSea,” said Olivier Lerner, co-author of the book “NFT Mine d’Or” (NFT Gold Mine).
“It’s a huge site and it’s not curated, so you really have no idea what you’re buying.”
LooksRare, an NFT exchange that overtook OpenSea for volume of sales this year, got into similar problems as its rival.
As many as 95 percent of the transactions on its platform were found to be fake, according to CryptoSlam.
Users were selling NFTs to themselves because LooksRare was offering tokens with every transaction — no matter what you were buying.
And the amounts lost to scams this year have been eye-watering.
The owners of Axie Infinity, a game played by millions in the Philippines and elsewhere and a key driver of the NFT market, managed to lose more than $500 million in a single swindle.
“As soon as you have a new technology, you immediately have fraudsters circling,” lawyer Eric Barbry told AFP.
He pointed out that the NFT market had no dedicated regulation so law enforcement agencies are left to cobble together a response using existing frameworks.
Molly White said strong regulation could help eliminate the extreme speculation but that could, in turn, rob NFTs of their major appeal — that they can bring quick profits.
“I think less hype would be a good thing — in its current form, NFT trading is enormously risky and probably unwise for the average person,” she said.
NFTs are often likened to the traditional art market because they have no inherent utility and their prices fluctuated wildly depending on trends and hype.
But Olivier Lerner suggested a different comparison.
“It’s like the lottery,” he said of those seeking big profits from NFTs. “You play, but you never win.”
DUBAI: Bahrain’s sovereign wealth fund, Mumtalakat, which has a 60 percent stake in Mclaren, expects the British racing team and supercar maker to go public in two to three years, its chief executive told Reuters on Tuesday.
“The racing team has benefited from the growth and viewership so that side of the business has been doing fantastically well,” Mumtalakat’s chief executive Khalid Al Rumaihi said in an interview.
“The automotive side clearly has challenges, but we believe in the company and we think this will be a prime candidate, obviously not at the moment, but in 2 to 3 years for an IPO (initial public offering),” he said.
Mclaren did not immediately respond to a request for comment when contacted by Reuters on Tuesday.
Mumtalakat, which has just north of $18 billion in assets under management, released its standalone annual results on Tuesday, which showed it swung to profit in 2021 from a loss in 2020.
The fund reported a profit of 45.6 million dinars ($120.96 million) for 2021, compared with a loss of 550.7 million dinars for the year 2020. It said the results were the fund’s highest earnings on an annual basis since it was established in 2006.
The fund paid dividends to the government, it said, of 20 million dinars as a contribution to the national budget.
Mumtalakat’s strong results were a result of the fund’s new investment strategy, which focuses on an active ownership model.
Results were boosted by its shareholding in Aluminium Bahrain (Alba) which recorded strong earnings last year on higher LME prices and higher production and sales from its line 6 expansion.
Mumtalakat owns about 69 percent of Alba, the world’s largest aluminum smelter outside of China, according to information on the company’s website.
Rumaihi said a second listing for Alba on Saudi Arabia’s bourse, the region’s largest stock exchange, was being considered by the company among several other options. “It is one of the initiatives they are looking at,” he said.
Mumtalakat said the lifting of travel restrictions resulted in higher ticket sales for its national carrier, Gulf Air, and that its principle associates National Bank of Bahrain and Bahrain Telecommunications Company continued to report strong results.
RIYADH: Saudi Arabia’s Energy Minister Prince Salman bin Abdulaziz on Monday held a meeting with his Egyptian counterpart Mohamed Shaker in Cairo to follow up on the progress on the electrical interconnection project between the two countries.
Last October, Saudi Arabia and Egypt signed contracts for a $1.8 billion electricity interconnection project that ensures an exchange of 3,000 MW of electricity.
The meeting was part of the official visit of Crown Prince Mohammed bin Salman to Egypt, the Saudi Press Agency reported.
During the meeting, the parties also discussed aspects of cooperation in the fields of renewable energy and hydrogen.
On Tuesday, Saudi Arabia’s ACWA Power announced an investment worth $1.5 billion in a wind power plant in Egypt as the company expands its horizons in renewable energy.
The deal will see ACWA Power develop, build, and operate the 1,100 MW wind farm located in the Gulf of Suez in Egypt.
RIYADH: Nayifat Finance Co. has named Chan Kok Veng as its acting CEO following a formal approval by its board.
The decision was taken after Abdulmohsen Abdulrahman Musaed Al-Sowailem stepped down as CEO, according to a bourse filing.
The appointment will take effect on June 23.
RIYADH: Saudi Arabia’s Cabinet has deactivated the decision to privatize Saline Water Conversion Corp. and transfer its direct and indirect assets to Water Solutions Co., which is fully owned by the Public Investment Fund.
Based in Riyadh, the SWCC is responsible for desalination of seawater and supplying various regions in the Kingdom with desalinated water.
In a tweet following the announcement, Saudi Minister of Environment, Water and Agriculture Abdulrahman Al-Fadhli said that the decision will enhance the level of services, and add to sustainability as well as enable investments in the water sector.
He also described the decision as a turning point for the sector.
أرفع الشكر لمقام خادم الحرمين الشريفين وسمو ولي العهد – حفظهما الله – على صدور قرار مجلس الوزراء بنقل أصول مؤسسة التحلية إلى “حلول المياه” وسيحقق القرار نقطة تحوّل وانطلاقة لعصرٍ جديد؛ أهم سماته الارتقاء بالخدمة و الاستدامة، وتعظيم فرص الاستثمار لتحقيق الريادة عالمياً.
In an earlier interview with Arab News, SWCC governor revealed that the firm will open six desalination plants by 2024 in a phased manner, beginning with the launch of two plants by late 2022.
Abdullah Al Abdulkarim added that these plants would be established across various cities of the Kingdom, including Al-Shuqaiq, Al-Shoaiba, Jubail, and Alkhobar.
Responding to the latest decision, the SWCC governor told Arab News that it will help SWCC enhance its services within the Kingdom, thus gradually allowing it to become a global champion.
Talking about the progress of SWCC in the last four years, he said: “SWCC in the last four years has made very good progress in terms of enhancing the technology, adapting new technologies, and building new plants which will increase the production capacity.”
He added: “Today we are producing 5.9 million cubic meter a day. And there, there are six plants under construction where it’s at the capacity of 3 million cubic meter.”
He also added that SWCC aims to decommission more thermal plants to embrace RO technology, which is more environmentally friendly and cost-efficient.
About a possible IPO in the future, he said: “SWCC will not tend to IPO. We will move the assets to Water Solutions Co., and it will turn into IPO. SWCC will remain a government agency. We should revisit the bylaw first like and find the right mandate for the circuit in the future.”
The official also added that he is currently the deputy chairman and managing director of Water Solutions Co., and made it clear that the company is looking for a suitable candidate for the post of CEO.
Earlier this year, Al Abdulkarim revealed the firm is close to reducing its carbon emissions by 60 percent.
Saline Water Conversion Corp is the largest desalination company in the world.
RIYADH: Saudi Arabia’s Cabinet has given a green light to the Bank of Jordan to open branches in the Kingdom to practice banking activities, Saudi Press Agency reported.
Listed on the Amman Stock Exchange, the Bank of Jordan was founded in 1960 and it operates over 100 branches in the country.