Twitter CEO Jack Dorsey addresses students during a town hall at the Indian Institute of Technology (IIT) in New Delhi

KEY POINTS

  • Crypto entrepreneur Sina Estavi purchased Dorsey's first tweet NFT at $2.9 million in 2021
  • Two years later, its value on OpenSea is below $4
  • A former SEC official called Dorsey's NFT "worthless"

The first-ever tweet of Twitter co-founder Jack Dorsey was sold as a non-fungible token for a whopping $2.9 million in 2021, but as the hype surrounding NFT fizzled down, the digital collectible's value also dropped. It is now only worth less than $4.

Crypto entrepreneur and Iranian investor Sina Estavi purchased Dorsey's first tweet as an NFT for $2.9 million, associating the collectible's value with its uniqueness and its link to the major social media platform.

A couple of years later and with the hype surrounding the once-booming industry winding down, the NFT's value plummeted to only $3.77, according to data from OpenSea, an NFt marketplace.

Estavi's efforts to sell the NFT for $48 million in 2022 proved futile despite the fact that he promised to give half of the proceeds to charity.

Former Securities and Exchange Commission (SEC) official John Reed Stark had some harsh criticism for Dorsey's tokenized tweet.

"The NFT Emperor Has No Clothes. Hence, it is not at all surprising that an NFT of Jack Dorsey's first tweet is now essentially worthless," Stark tweeted Thursday. "While NFTs are supposed to be completely decentralized, in most cases there's no cryptographic relationship between the image that an NFT points to and its token. The image could be easily altered or replaced if people with access to servers changed the file names."

Stark is a known critic of the cryptocurrency industry, centralized exchanges and NFTs.

"Whether the NFT bubble has burst is a rhetorical question. The crash comes despite the countless celebrities who blatantly exploited their own fans, shamelessly shilling these nonsensical fractionalized JPEG links as a prudent pathway to financial success," he added.

Stark also labeled NFTs as "glorified computer code and not some sort of futuristic solution for ownership disputes" and claimed it creates "an eternal and infinite vortex of conflict, instability, criminality, chaos and destitution."

The former SEC official said the industry is not just "the Wild West" but a "global financial post-apocalyptic Walking Dead-like anarchy."

"Like the rest of crypto world, in the NFT marketplace, there exists no regulatory oversight, no consumer protections, no net capital requirements, no licensure, no US audit, examination or inspection. It's not just the Wild West, it's global financial post-apocalyptic Walking Dead-like anarchy," his tweet read.

The crypto industry has seen a prolonged bear market. It is currently experiencing a market downturn following the collapse of major crypto empires and the closure of several crypto businesses.

But the NFT industry suffered far more decline in valuation and activities since its boom in 2021, with bids for digital collectibles dramatically dropping as a result. Even the premium NFT collectibles, which were previously purchased by celebrities for millions of dollars, have nosedived in value.

The Bored Ape Yacht Club (BYC) NFT that Canadian singer Justin Bieber purchased in January last year saw a substantial drop in value and is now worth around $59,000, giving him a paper loss of around $1.24 million.

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