NFT: The market is caught off guard

In August, the NFT Summer: Project teams swarmed, fans’ anxiety and fanaticism… Now the NFT market has taken a sharp turn, and it has entered its cooling-off period.

NFT is cold.

Liquidity crisis

As the source of this round of NFT explosion, CryptoPunks has always been an iconic NFT vane. On August 23, following the purchase of Visa and the entry of many bigwigs, there was a FOMO boom, and the transaction was completed in just 4 hours. 16,000 ETH . Less than a week later, the floor price of CryptoPunks was pushed up to 140 ETH, almost doubled.

However, just over half a month later, the craze quickly dissipated.

According to OpenSea data, the daily trading volume has gradually declined since September. There were only 5 transactions on September 9, and the average transaction price was 104.52ETH. Compared with the peak of 354 on August 23, a decrease of 98.5%; from the perspective of turnover, compared with the historical peak turnover of 43871 ETH on August 28, a decrease of 98.8%, which can be said to be a cliff-like decline.

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This is true for CryptoPunks, and even more so for other projects. According to DappRadar data, the traffic and transaction volume of popular projects such as Loot and ArtBlocks have been lost in the last 7 days.

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Not only that, according to DappRadar data, in the trading market, among the top 10 trading platforms in the last 24H, except for CryptoPunks and AtomicMarket, the rest have experienced varying degrees of decline in both traders and trading prices.

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Judging from the 7-day data, OpenSea, CryptoPunks, Foundation, Rarible , Hic et nunc, NBATopShot, SuperRare , AaveGotchi’s transactions fell between 20%-67%.

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According to nonfungible data, the entire NFT market has a downward trend in terms of sales volume, sales, active wallets, primary and secondary markets.

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Weekly NFT sales volume trend

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NFT market sales trend in the past year

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Trends in the number of active wallets buying and selling NFT in the past year

Ye8OBkNAMU4kyUli4ZvAvPrbkXfiDoHg3IMMnSUP.pngPrimary market sales data

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Sales trend in the secondary market in the past year

The collapse of the meta-universe concept

Thanks to the enthusiasm of NFT and other concepts in the early stage, the concept of meta universe is highly sought after in China.

Take Visual China as an example. Visual China announced on the evening of August 26 that the company is preparing to launch the blockchain transformation of the 500px community, using NFT technology to upgrade the community, and creating the world’s leading blockchain-based visual digital art creative community. Subsequently, from August 25th, about 10 yuan, to the high point of 17.34 yuan on September 8. In only half a month, Vision China rose by nearly 70%.

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At the same time, the concept of “meta universe” suddenly broke out in A shares. On September 7, according to Dongcai data, the Meta Universe Concept Index once rose by more than 8%. As of the close of the day, the increase narrowed to 6.78%. On September 8, the “Meta Universe” concept stocks once again collectively attacked and set the daily limit tide. According to data from Dongcai, as of the close of the day, the Meta Universe Concept Index rose 14.7%, and the disk is even closer to the full-screen daily limit.

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However, the market boom did not last long. On September 9th, the supervision was connected, the concept stocks of Meta Universe “turned off”, and the sector index pulled back. Data show that the Meta Universe Concept Index closed down 6.78%, most of the relevant stocks fell, and Visual China fell to the limit.

Conclusion:

In fact, looking back at this track, there are many challenges such as high prices stimulated by hype, lack of project parties and buyers and sellers who truly understand the core value of NFT, poor liquidity, and money laundering risks. To put it simply, the current development of NFT is facing great uncertainty.

As stated in the “Securities Times” article on September 10, there is actually a consensus that there is a huge bubble in the trading of NFT works, but there are still players who are still obsessed with it. Many players focus on the form of NFT, rather than the work or asset itself, because this form has the value of hype. It is not difficult to understand that through the fog of time, the value will eventually return to the work. Once the market’s popularity decreases and the phenomenon of hype with the wind gradually cools, the asset value of the current many strange NFTs will also be greatly reduced.

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/nft-the-market-is-caught-off-guard/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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