This isn’t the first time NFT’s death has been predicted. However, non-fungible tokens are still doing well, and the excitement around them isn’t waning much.
The ” The NFTs got stuck “, According to the Wall Street Journal. For Le Monde, the market crypto-art is ending “.” End of the digital Eldorado “ on Kulture Geek, ” collapse »To the Journal du Geek, or even« sales down on La Fnac: on the web there are many who give NFT for dead. Is the NFT market really collapsing? Actually, not really.
NFTs became a hot topic in 2021. These non-fungible tokens, or non-exchangeable tokens, are backed by blockchain technology, and this is what allows them to serve as certificates of authenticity. In ” mint », Or by registering a computer file on the blockchain, it is possible to ascertain its origin, owner and rarity.
It is precisely for these reasons that NFTs have created a record-breaking art market in early 2021, with sales reaching several million dollars. Since then, NFT sales have declined and many call them dead. However, non-tradable tokens are meant to stay.
What is happening ?
It is true, however, that negative signals accumulate. On April 7, 2022, the owner of the first NFT tweet put it up for sale. Purchased for more than $ 2 million the previous year, the NFT is now unable to find owners and its price has plummeted: the highest offer on May 9, 2022 is only 24 $ 600.
The Wall Street Journal also explains in its article that NFT sales have dropped significantly: only 19,000 NFTs are sold per day, compared to 225,000 in November 2021. wallets assets (i.e. people actively seeking to sell or buy NFTs), is also down: they were no longer 14,000 last week, up from 119,000 in November, an 88% decline in just a few months.
The Non Fungible specialized site, which studies the main trends in the NFT market and which has published a study that collects the main data of the first quarter of 2022, is also down. Between the last three months of 2021 and the same period of 2022, the number of sales fell by nearly half and the number of buyers decreased by 30.91%. In addition to the number of sales, it is the total value of transactions that decreases: in all, between the 4th quarter 2021 and the 1st quarter 2022, sales decreased by 4.60%, from over 8.2 billion to 7, 8 billion.
Between the number of coins sold and their falling price, there are many indicators that suggest the NFT industry is not doing well. However, this is still far from being the case.
Second hand NFTs are still popular
First of all, it’s not just bad news for the sector: the average price of NFTs has increased by 80%, demonstrating the fact that the vast majority of tokens continue to appreciate in value. The average time spent owning an NFT before reselling it is also increasing, showing that the market, while still speculative, is less unstable and volatile than last year.
These important indicators have not been taken into account by some observers, which distorts the overall image of the sector. Therefore, it is also important to note that sales of what could be called ” Second hand are on the rise and represent a larger share of transactions than ever. This ” second-hand market now it represents 90% of the value traded and around 70% of sales volumes, according to Non Fungible.
Finally, as Non Fungible points out in its report, it is very important to indicate that ” The 2022 trends confirm that, more and more, the price of NFTs is decorrelated from that of cryptocurrencies Although bitcoin’s value is still volatile, such a trend confirms that NFTs are increasingly seen as safe havens for cryptocurrency owners.
In a dedicated Discord, site team members explained that ” although the number of active portfolios is decreasing, the number of buyers is still greater than the number of sellers “, which is, according to them,” a sign that there is still interest in NFTs “. More, ” with nearly $ 8 billion in sales in the first quarter. of 2022, the market cannot really be said to have collapsed “, They underline. ” We observe a stabilization of the NFT market, in line with what we noticed at the end of 2021. “
A market in “stabilization”
It should not be forgotten that, in the past year, the NFT sector has grown very rapidly, attracting a large number of visitors and an equally large number of new projects. ” The NFT market is “digesting” all the NFTs released in the last year ”Explains the Non Fungible report. The market, which had reached saturation and had chained records, is just starting to regulate and stabilize.
So if there is a decline in NFT sales, the time has not yet come to panic: it is not yet the end of NFTs, far from it. Last year, some observers already predicted the demise of these tokens, when the start of the used market for NFT was barely visible – and today they are still there.
However, it is not because the market is stabilizing that price records have been reached. The popularity of collectible NFTs is still there and it’s still impressive. The Bored Ape Yacht Club collection is the perfect example: monkeys are the most sought-after tokens of the moment and are collecting impressive figures. Such is their popularity that when the Bored Ape metaverse project was launched, NFTs in the field sold out so quickly that transactions clogged the Ethereum blockchain for a while, proof that NFTs still have a lot to offer.