The non-fungible token market has capitulated in the last 30 days, with holders selling their digital assets at a substantial loss and marketplaces experiencing declining volume and users.
NFTstatistics.eth, a Twitter user that tracks the NFT market, posted data showing that secondary sales losses are at around 1,000 ETH ($1.9 million) on average per day, with instances where losses reach as high as 3,000 ETH ($5.7 million).
“It’s unlikely we will know how long such a price depression will last,” said Pet3rpan, a crypto investment firm 1kx Network partner.
“As a result, I believe we’ll see more NFT IP teams focus much more on product development as a means of backstopping the value of their ecosystem.”
At the beginning of April, Finbold reported that crypto-related US trademark filings had declined in 2023, with NFT-related trademarks being down two-thirds compared to the same period in 2022.
The USPTO received 885 NFT-related trademark applications in Q1 2023, down from 2,530 in 2022.
On top of that, a holder sold 27 Bored Ape Yacht Club NFTs, valued at $3 million at the time. The sale caused a chain reaction and might have something to do with the downturn across the market.
The numbers remind holders how NFT’s price action has been on a rollercoaster ride for a while now. In September last year, NFT’s monthly trading volume also saw a significant plunge, dropping by 97 percent since its peak.
At the same time, collateral NFTs on lending platforms are being liquidated, with most of the liquidations occurring on NFTfi. In response, the platform has announced a rewards program called OG points to motivate users and NFT holders to continue using their service despite the market downturn, allowing eligible collection borrowers and lenders to earn points that can be converted to blockchain tokens.
It should be noted that despite the recent downturn, the NFT market has grown and evolved, per a report from CryptoPotato. Q1 2023 was the best quarter since Q2 2022, with a 137 percent increase in NFT trading volume to $4.7 billion, and NFT sales increased by 8.56 percent from Q4 2022 to 19.4 million.
Collections sink and rise
According to data from IntoTheBlock, a prominent blockchain and cryptocurrency data analytics company, only three of the top 10 most valuable NFT collections by market capitalization have increased in price in Ethereum (ETH) over the last month. These collections are CRYPTOPUNKS (3.53 percent), Azuki (3.76 percent), and Autoglyphs (0.56 percent).
Meanwhile, only six recorded increased trading volumes over the last 30 days. The remaining collections experienced a notable decline, ranging from 20 percent to 99 percent. This includes big names such as CRYPTOPUNKS, Mutant Ape Yacht Club, Otherdeed, Moonbirds, and Doodles.
Despite rising in price, CRYPTOPUNKS, which is the second-largest by market capitalization, dropped by 60.30 percent in trading volume in the past month.
Mutant Ape Yacht Club, Otherdeed, Moonbirds, and Doodles—also top digital collectibles—saw drops of 20.16 percent, 53.09 percent, 73.57 percent, and 63.55 percent, respectively.
Yuga Labs’ Sewer Pass, the ninth-largest collection by market cap, experienced one of the worst drops, plummeting by 99.16 percent in its trading volume.
Despite major collections tanking, some collections are seeing increased trading volume. There was a 53.81 percent increase in trading volume for Captainz’s NFT collection, whereas the largest NFT collection by market cap, Bored Ape Yacht Club (BAYC), experienced a 24.67 percent surge in trading volume.
Azuki and Autoglyphs’ trading volumes also increased along with their prices by 24.49 percent and 14.70 percent, respectively.