Is the NFT crash happening? Data released in the last week shown NFT transactions have slowed, and even decreased 92% from this time last year. The rise of popularity of NFTs does appear to be in decline, but is this really the end or a new beginning for non-fungible tokens.
Despite the news of a decline, it’s not dampening the excitement of some tech and video games companies to plan for what’s to come next.
So, that NFT crash news? The downturn as reported by crypto data site NonFungible shows a transaction volume decrease of 47% in Q1 of this year compared to the previous quarter. Sorry to bore you with figures, but this is ultimately a sign that reality is bearing down on a tech and market that has been heavy on hype and short of use for some time.
But the idea that NFTs are over is an overstated belief. For example, the Moonbirds NFT project added $500 million worth of trading volume, while the Solana blockchain saw a 91% month-on-month increase, recording nearly $300 million in NFT trading.
The recent launch of Yuga Labs’ new Otherdeeds NFT, a virtual land sale for a forthcoming video game, crashed the Ethereum blockchain as it was in such high demand, even though the floor price was $5,500 / £5,000. The pull of ‘blue chip’ NFT brands remains high and people are prepared to spend big to get a piece of what could come next.
Yet overall NFT trading is slowing at a macro level, and for many artists invested in the NFT space this can’t come soon enough. Some believe NFTs need a reset so new uses, experimentation and entrepreneurial ideas can bring better value and true democratisation to this digital tech.
What comes next could really define what NFTs are and how they are used, especially by artists and creators. The hype looks like it’s coming to an end, and many in the NFT space should welcome it, as what’s next could be genuinely interesting.