Experts Say “NFT Market Is Dead” As Sales Slump

NFTs made constant popping up in the mainstream media throughout 2021 as investors who own CryptoPunks and projects minted prior to 2018 have been rewarded for their patience. Meanwhile, more recent projects like Bored Ape Yacht Club and Art Blocks Curated have seen some of the rarer pieces that have sold for up to millions of dollars.

Regardless of the multi-million dollar sales for unique NFTs and record sales on marketplaces like OpenSea, the data shows that most NFTs are lower-priced and lesser-known projects, and the sector is quite illiquid. Using data from OpenSea, a report A recent Bloomberg report showed that 73.1% of NFT assets had only one trade in the past 90 days.

Number of transactions for assets on OpenSea | Source: Bloomberg

The data pertains to investors looking to buy NFT to pay over $ 100 to mint a new NFT and use the amount of gas required to transfer the asset.

“Chromie Squiggle # 7583 was sold for 922.5 Ether ($ 2.8 million) after it was bought 8 months ago for 0.25 Ether ($ 750).”

Commenting on Bloomberg, Gauthier Zuppinger, COO of Nonfungible said that “probably 90% of the collections minted today are completely useless and meaningless”.

Regarding NFT investments, Zuppinger said:

“99% of the time, you are in the right circles with the right information at the right time. In the NFT space, you live with constant frustration that you missed your chance to make a billion dollars. “

Is the NFT Market Dead?

Further evidence that the NFT sector has cooled significantly from its August high is in the number of exchange traded sales.

Number of NFTs sold | Source: Not fungible

Daily sales across all NFT stores decreased from 138,109 on August 30 to 42,372 on September 21, according to Nonfungible.

A similar chart pattern is seen on many NFT market indices, including value from completed sales, active market wallets, primary and secondary market sales, retail buyers, and retail sales.

These market developments have got the attention of Dennis Porter, who argues that the latest data from the NFT field shows that “the NFT market is dead”.

“As I expected, the NFT market is dead. The average price of NFT has fallen more than 99%. The death of liquidity has come. Don’t regret calling this market a scam. Pump and dump is done. “

In terms of activity in the market, “the most actively traded 3% of collections make up 97% of total trading volume,” according to Bloomberg, suggesting that the NFT market is very similar to the cryptography market in which a small percentage of tokens makes up the majority of the trading volume.

All in all, these developments suggest that the recent bull cycle for the NFT sector is coming to an end and that it may take some time for liquidity to pick up in the NFT market, especially given the decline in liquidity.

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