More than 80% of all NFT transactions will be worth less than $ 10,000 by 2021 and are classified as “retail” in recent Chainalysis research.

In report 6 of the blockchain analysis company Chainalysis entitled: “NFT Market Interpretation 2021”, which describes the NFT trading trends throughout 2021 in detail. The researchers used data on the chain from January to October 2021.

While retail transactions account for more than 80% of all NFT transactions on any given day in 2021, collector-sized deals rose from 6% in March to 19% on October 31, showing an increase in large collectors over the year.

Institutional transactions make up just under 1% of the total volume, but make up 26% of the actual trading volume.

A retail store is valued at less than $ 10,000 while a collectible-scale store is valued at between $ 10,000 and $ 100,000. Research has shown that an institutional transaction is valued at more than $ 100,000.

The graphic below shows the dominance of retail deals from January to October, with a sharp increase in collector-size deals from September.

NFT transaction size ratio | Source: chain analysis

A large chunk of total transactions is generated through retail activities, but collectors and institutions represent a large portion of the NFT dollar trading volume since March, with collectors accounting for 63% of the volume and institutional trades for 26%, i.e. retail. for 11% of the volume during the examined period.

NFT trading volume | Source: chain analysis

The researchers compared the NFT market to the broader cryptocurrency market, where retail transactions account for a much smaller proportion of total transactions.

“The data shows that the NFT market is more retail-focused than the broader crypto market, where retail transactions make up a negligible proportion.”

NFT-related earnings potential is one of the factors driving crypto adoption in 2021, according to a report. This is evidenced by expected NFT record sales of $ 17.7 billion by 2021.

In the past week alone, NFT’s revenue climbed to $ 300 million, nearly a quarter of which came from the purchase of Metaverse land from The Sandbox.

Additionally, at least $ 26.9 billion in crypto has been sent to ERC-721 and ERC-1155 contracts (the dominant Ethereum standard in the industry for NFTs) by 2021.

Whitelist to make a profit

Despite the huge sums of money being spent on NFTs, the report states that “only 28.5% of NFTs are bought during minting and then sold on the platform for a profit”.

Chainalysis recommends whitelisting to increase the chances of benefiting from a newly minted NFT. Users who were whitelisted in an OpenSea minting event earned 75.7% most of the time, compared to 20.8% who were not whitelisted.

“The data shows that it is almost impossible to generate outstanding returns from mint trades that are not on the whitelist.”

However, NFTs bought in the secondary market after minting “result in a 65.1% return in most cases,” the report added, suggesting that if whitelisting is not possible, it is better to wait is participation in an embossing event.

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