What was once a scorching market fueled by FOMO during the 2021 crypto bull market is now a trickle, with trading volume on the most popular NFT marketplace, OpenSea, down 99% in one month. just under four months.
On May 1, OpenSea processed a record $2.7 billion in NFT transactions, but on Sunday the market saw just $9.34 million, according to data compiled by DappRadar. The company registered 24,020 users on Sunday, about a third less than when it hit its peak number of transactions in May.
The massive drop in volume in the NFT market coincided with a drop in crypto prices. The most popular cryptocurrency, Bitcoin, is down nearly 57% year-to-date to $20,276. The second most popular cryptocurrency by market capitalization, Ethereum, fell around 59% to $1,528 over the same period.
As trading volumes and crypto prices fell during a recession dubbed “crypto winter,” the most popular NFT collection price floors, which indicate the lowest price at which an NFT from the collection sells, also fell.
The floor price of the most popular NFT collection, Bored Ape Yacht Club, fell 53% to 72.4 Ether (about $110,000) on Monday, from a high of 153.7 Ether on April 30. according to CoinGecko. Another popular NFT collection, CryptoPunks, is down 19% from its July peak.
After this story was first published, an OpenSea spokesperson said via email that the company disagreed with DappRadar’s methodology, noting that the 99% swing compared the trading day to the site’s all-time high with one of the lowest. According to OpenSea’s preferred metric – ETH volume, which excludes the effects of cryptocurrency price swings – the trade is still down sharply. By this metric, monthly volume fell 62% from May to July and is poised to decline further in August, according to crypto-tracking platform Dune Analytics.
OpenSea, the spokesperson added, is not worried about declining trading volume.
“We play the long game because we see what’s possible, so we’re not so concerned about short-term volatility,” the spokesperson said. “We always expected foam, hype, and deflation as the community and use cases evolve, technology becomes more sophisticated, and creators figure out how to incorporate more utility into their projects. .”
The crypto downturn has left many retail inventors reeling. A Pew Research Center study last week found that 46% of Americans who had put money into crypto said their investments had not lived up to their expectations.
Although crypto has become increasingly important over the past year, Pew found that only 16% of American adults had invested in crypto, almost the same number who said they had invested last September.
(This article has been updated to include comments from OpenSea.)
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