Sales of non-fungible tokens (NFTs), registrations on blockchains acting as deeds, have plummeted. The industry is still experiencing high demand, but buyers are becoming more picky. ‘The fear of missing out is over.’
NFTs refer to digital or physical objects and are located on blockchains, where data is stored worldwide in a way that in principle can not be manipulated. NFTs can be traded. Sales have fallen 92 percent this week to 19,000 tokens from a high of 225,000 in September. It reported the Wall Street Journal based on data from the specialized site NonFungible. The number of active crypto-wallets fell 88 percent from a maximum of 119,000 in November to 14,000 last week.
- The number of NFTs traded has fallen over the past week, according to figures quoted by The Wall Street Journal.
- Other sources point to changes in the market, which in themselves would still be growing.
- Buyers are now more aware of the community behind a project, its iconic value and the benefits it provides.
The article also provided painful examples of extreme value loss. The NFT of the first tweet from Jack Dorsey, the co-founder of Twitter, was sold in March last year for $ 2.9 million. When the owner wanted to sell it earlier this year, the highest bid was around $ 14,000. He has not accepted it.
Since the beginning of this year, the dollar value of the NFT market has also been under pressure, linked to fears of higher interest rates and the impact of the war in Ukraine. The prospect of higher interest rates weighs on the growth sectors, as shown by the price development on the technology exchange Nasdaq.
The big increase in sales last weekend comes from Yuga Labs, producer of the crypto-token Bored Apes Yacht Club, which sells virtual land for $ 320 million. The massive sale nearly collapsed the Ethereum blockchain on Saturday.
The Cointelegraph page has previously talked about a consolidation of the NFT market. Data from Dune Analytics would indicate a strong market with much higher number of users and transactions. The popular marketplace OpenSea is said to have recorded a volume of nearly $ 550 million on Sunday alone.
There may be a discrepancy in the numbers due to the influence of Axie Infinity. That video game is based on NFTs and had become very popular. But volumes have fallen sharply recently.
Data from blockchain data firm Nansen suggests a shift is on the way. Established and expensive brands like Bored and Mutant Ape Yacht Club would far surpass the cryptocurrencies associated with art or games.
Much more money flows into collections of great value or all sorts of benefits and for frequently played games.
Venly, the Flemish provider of blockchain technology, has a direct view of the market. It offers wallet systems, digital wallets in which users can manage their NFTs and cryptocurrencies. These wallets count more than 2.5 million users. “There is a consolidation where volumes and transactions are still increasing. The money goes much more to collections with great value or all possible benefits and to games that are often played ‘, says marketing manager Yan Ketelers.
‘In the beginning, everyone was suddenly making NFTs and there was speculation about almost everything. There was fomo, fear of missing something. It is over. NFTs are no longer just bought ‘, says Ketelers.
According to him, the value depends, among other things, on the community behind the project. It could be a digital club, such as Bored Apes, or a football club. The CryptoPunks collection has iconic value. Finally, we look at ‘utilities’ such as access to events, collections, games, or community forums. The NFT collection Moondbirds broke all records. So there were all sorts of benefits associated with it ‘, says Ketelers.
“The number of wallet users will grow. It is 100 percent safe ‘, says Ketelers. Brands also make it ever easier to create wallets, with the intervention of companies like Venly. ‘NFTs are a hype, but also a rapidly growing application’, concludes Ketelers.