While transaction volumes fell drastically last year, NFT18 calls out “encouraging signs” for 2024.
Turbulence in the crypto market has had a significant impact on the NFT market in 2023, according to NFT18 (formerly NonFongible.com). In fact, annual volumes are down 62% compared to 2022, reaching $10 billion. Similarly, NFT trading saw a “record loss” of nearly $1 billion.
Furthermore, while some NFTs could be worth several million dollars in 2021, the average price of an NFT fell by 67% between 2022 and 2023, reaching $665. This is due to the “significant volume of low-value NFTs traded in various tier 2 and the decline in value of most NFTs,” the report said.
NFT (“Non-Fungible Token”) is a blockchain-issued digital asset title associated with a digital asset (photo, text, video, etc.). Each NFT is unique and cannot be reproduced. NFTs are used in art, the luxury sector or even for trading cards in sports.
Suspicious volumes
New trends emerged last year. “Most Western countries have lost interest in NFTs, with most research now coming from Asia, the Middle East and Southeast Asia,” it says. Similarly, while the Blur NFT market overtook Opensea’s historic market last year, “more than 50% of Blur’s trading volume is suspect,” the report estimated.
“These suspicious volumes are generated by traders who try to artificially increase the volume of their activity by buying or reselling assets themselves through various wallets (portfolios, ed.). The aim of these actors is to use the rewards offered by the platforms (donations of certain tokens with a financial value )”, we can read.
Within the market, collector interest continues to be focused on collectibles, which accounted for $6.3 billion in transaction volume last year, thanks to popular collections like CryptoPunks and Bored Ape Yacht Club. Other areas of interest include video games, art and virtual worlds.
Despite “a very difficult year, the fourth quarter shows encouraging signs of recovery”, the report points out. If the bonds weren’t there, the community didn’t leave this universe. The market has 2 million active wallets, which is 10% less compared to 2022. The community is also focusing on new blockchains or new layers, especially the Ethereum2 layer.