Digital assets are going through a difficult period: falling sales, falling amounts collected, falling prices, falling in the number of sellers and buyers… Could this finally be the end of NFTs?
The fall is spectacular. NFTs, these digital certificates of authenticity that fetched record prices just a few months ago, are nowhere near as popular as they once were. Data collected from Media Block and published on July 30, 2022 show the extent of the phenomenon: sales of NFTs, all platforms together, have fallen critically.
While a few months ago, the sale of a new collection of NFTs by the Bored Ape Yacht Club had literally blocked the Ethereum blockchain, tokens are now suffering from “crypto winter”. And the trend looks set to last.
A market in crisis
“ Crypto winter it is the nickname of the very difficult period that the market is currently going through. More prices have been dropping for monthsThe cryptocurrency sector has also had to deal with some impressive crashes: that of the Terra ecosystemWHO took with it 50 billion dollarsAND Celsius bankruptcies AND of 3 Capital Arrows.
However, by June, the NFT sector was spared the phenomenon, as data from The Block shows: sales were still high. The sales decline really happened in June. While sales were $3.9 billion in May, they fell to just $884 million a month later. OpenSea, the leading NFT trading platform, is the only one that manages to come out on top, while the others have almost disappeared from the data. It’s simple: it’s been a year since sales numbers have been this low for NFTs.
These are not the only data that show that the market is going through a difficult period. The NonFungible site, which collects data from several platforms, published its analysis for the second quarter of 2022 on July 26 and his conclusions are also negative. He estimates that the market saw a 25% drop in sales value – a trend that could last for a while.
” It’s not just the total value of sales that has fallen notes Non Fungible in his report. ” This is also the case for the number of buyers and sellers and the number of sales. All indicators are red: number of active portfolios, profits and average selling price. The only data in green isn’t really good news: the number of contracts has increased simply because there are more NFTs than a year ago, and the average length of ownership of an NFT has increased because they are harder to was resold.
As for the declines in sales, they can be mainly explained by the fact that many NFT collections have lost their appeal since the beginning of the year in favor of the more popular ones. ” CryptoPunksMeebits and Bored Ape Yacht Club now account for 30% of all sales volume ,” according to NonFungible. Since these three collections belong to a single entity, Yuga Labs, we are indeed witnessing market concentration.
So, would this be the end of NFTs? After it was incorrectly predicted for the first time in 2021then another time in May 2022, the end of NFTs has never seemed so close. However, you should not bury it immediately non-exchangeable tokens : while the speculative market may be nearing its end, there are still uses for the technology, especially through Ethereum Name ServiceAND through several metaverse projects.