According to a report by Olga Kharif and James Tarmey for Bloomberg, the non-fungible token (NFT) market is going through a severe downturn, with declining trading volumes and waning investor enthusiasm. Daniel Megard, a prominent NFT collector who goes by the pseudonym Seedphrase, is apparently downsizing his collection because the market has “completely collapsed.”
Data from Dapradar, cited by Bloomberg, indicates that monthly trading volume for NFTs is set to decline by 81% between January 2022 and July 2023. Also, there has been a decline of 61% in the monthly sales figures. Popular NFTs such as Bored App Yacht Club and Cryptopunks also saw minimum prices for two-year lows.
Lorenzo Melendez, president of NFT project Pudi Penguins, told Bloomberg that the market charts are uniformly negative. Both investors and sellers are grappling with the challenge of finding long-term value in these digital assets.
While the broader crypto market has shown signs of stabilization this year, NFTs have struggled. Bloomberg reports that NFT marketplace Recur is shutting down due to “unforeseen challenges” and another platform, Nifty, is also shutting shop. Blur, a leading NFT marketplace, has seen its ether-measured sales volume drop by 96% between late June and early August.
Digital artists are also facing challenges. OpenSea, a major NFT marketplace, recently made royalties optional on secondary sales, causing concern among creators. Regulatory fears are also on the rise, with the US Securities and Exchange Commission taking its first enforcement action against NFTs.
Despite the overall slowdown, Bloomberg notes that some segments of the NFT market still retain value. High-end artwork from renowned creators and low-value NFTs used in games continue to be in demand. Although overall sentiment in the market remains grim, Melendez said, “I think we have a very tight bottom left to go.”
According to Bloomberg, the decline in the NFT market has been attributed to a variety of factors, including the shift from a collector-driven to a merchant-driven market, and a drop in the price of Blur’s native token, which is down 32% over the past year. Has been. 30 days. According to his report, even the term “NFT” is falling out of vogue, with auction houses and projects now referring to them as “digital art” or “digital collectibles”.
Featured image credit: Midjourney