In terms of volumes, June saw the worst performance for NFTs since the start of the summer of 2021. While January saw record highs, activity in the sector has since declined sharply. But this trend is not entirely relevant to the crypto market.
NFTs have seen a decrease in number
While non-fungible tokens (NFTs) saw their volumes explode on the rise at the start of the year, the trend has since broken. It was all the more marked as the month of June recorded it worst performance since the start of summer 2021 :
Figure 1: Volumes of NTTs
While June ended with a total volume of $ 1.04 billion, the January high rose to $ 16.57 billion. To make a more reasonable comparison, May recorded $ 4 billion. But for a month, the volume was still the same decreased by 74%.
This low trend was also observed between the two main competitorswhich are OpenSea and LooksRare:
Figure 2: Comparison of volumes between OpenSea and LooksRare
If we examine the data in Figures 1 and 2, we find that the fall is even more severe for LooksRare. While the latter, who is seeking to ban OpenSea, represents most of the volumes in the first quarterits fall is more violent.
Taken February 2, 2022 as an example, LooksRare was created $ 703.1 million in volumes, against 182.58 million for OpenSea. As of June 30, OpenSea is creating $ 15.59 million volumes if LooksRare reaches 5.52 million.
By comparing these two extremes, if they are truly comparable, we can see that even if the fall is significant and widespread, it is all the more difficult for outsiders. In fact, its number was later seen divided by 127.4 for two days compared, if this coefficient is 11.7 for OpenSea.
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The consequences of Ethereum (ETH)
If we focus on the Ethereum (ETH) blockchain, OpenSea remains largest gas consumer daily. The importance of NFT’s popular market volumes is also the price barometer of Ethereum transactions.
However, this did not prevent the network from seeing, on Saturday, the average cost of a transaction. hit the bottom since December 12, 2020. At that time, the average price recorded $ 1.62 against $ 1.69 this weekend:
Figure 3: Average price of an Ethereum transaction
Of course, the health of the NFT market is not only responsible for the reduction in fees. This trend is about an overall reduction in network demand. However, this decrease in volumes still affected Ethereum’s gas price.
To determine gas consumption in OpenSea, you need to study the protocols used through the platform. Since Seaport launched in mid-June, OpenSea has typically reached between 200 and 400 ETH in fees per day:
Figure 4: Fees Consumed by Seaport from OpenSea
If we compare this trend with Wyvern, OpenSea’s former smart contract, we get the full measure of reduced activity. With Wyvern V2, active from March to June this year, OpenSea is creating between 300 and 1000 ETH to be paid per day. But the fall is even more marked compared to the current season, when the application runs under the Wyvern V1.
As shown in the graph below, the entire month of January was recorded days of more than 1,000 ETH fee and sometimes more than 2,000:
Figure 5: Transaction fees generated by the OpenSea Wyvern V1 protocol
Data from various smart contracts used by OpenSea therefore confirm overall reduction in activity in the NFT sector.
With the fall in volumes recorded by NFTs, one would think that their prices have collapsed. If the trend is really down, it is not comparable to the crypto market in general.
For the Bored Ape Yatch Club (BAYC) collection, for example, the average sale price recorded a discount of 30 to 35% since a high at the end of last April. This height is due to the arrival of the metaverse Otherside:
Figure 6: Average selling price of a BAYC NFT at ETH
In general, the decrease in volumes is more likely to lead to a drop in liquidity. An NFT then harder to sellbut it does not have to be sold at a lower price.
On the other hand, it seems difficult to provide an overall price trend for this asset class. And for good reason, their value depends directly from the popularity of a project and the community that supports it. In this, the price behavior is revealed more different than cryptocurrencieswhere Bitcoin (BTC) marks the trend.
However, it is certain that the slowdown in activity makes it possible to clean up the market for projects at no additional cost.
👉 Also in the news – “000.eth” domain name sold for over $ 300,000
Sources: The Block, Etherscan, Average transaction price, Wyvern V1, Seaport, OpenSea
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