NFT markets are almost entirely new phenomena, having only gained significant popularity in December 2017 with the launch of CryptoKitties. This, paired with the fact that NFTs are mostly in highly subjective categories, like art and collectibles, means that NFT markets and projects rely heavily on community approval for their assets to accrue value. This means that NFT markets tend to be highly cyclical, and trade volumes tend to flow to “hot” projects.
I couldn't agree more. Just seeing the success of Hashmasks, a lot it IMO had to do with providing a heuristic for discounted value, as buyers didn't even know what art they were buying, but knew the price of future batches. That psychological short cut gave buyers shelling points, or reference prices.
Eventually, once buyers received the art and many entered the secondary market, reality re-entered and the generic nature of the art brought down the price expectation somewhat. But I think the use of such heuristics will become widely adopted for NFT projects, until we have better price discovery mechanism than purchases or collateral-backed bids.