NFT market down 92% offers contrarian opportunity
The NFT market has experienced a significant decline, with global sales volume down 92% from its January 2022 peak, according to data from CryptoSlam.
At the height of the NFT boom, high-profile collections like Bored Ape Yacht Club (BAYC) and CryptoPunks sold for millions of dollars, and the market peaked at over $6 billion in monthly sales.
However, by early October 2024, NFT sales had dropped to just $100 million.
The rapid rise of NFTs in 2021 was fueled by an abundance of market liquidity, with low-interest rates and widespread adoption of blockchain ecosystems like Bitcoin, Ethereum, Solana, and BNB Chain.
Since then, the market has been in a downward spiral, with both 2022 and 2023 marked by declining sales figures.
Despite the current state of the market, some analysts believe that this could be the ideal time to invest in NFTs.
Nick Tomaino, founder of 1confirmation, shared his view on X, stating, "The total market value of the entire NFT asset class is ~$4.9B, down over 92% from the peak in 2022. Nothing has changed long-term. Building and investing in NFTs now is the ultimate contrarian and right bet."
However, this strategy carries risks.
CryptoSlam reports that the number of unique buyers and sellers has slowed, and while prices slightly recovered from September 2023 to early 2024, overall interest in NFTs continues to decline.
In September, sales fell to $296 million, down from $373 million in August, marking a near 70% drop from December’s $1.7 billion.
Ethereum (CRYPTO:BTC) remains the dominant platform for NFT trading, with over $44 billion in NFT sales, but regulatory pressures and the potential for further declines in crypto prices could impact future activity.
If Ethereum’s price falls below $2,100, analysts warn that NFT trading could take another hit.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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