NFT

Is the NFT Market Starting to Cool Down?

NFT

NFTs have become the hottest trend in fintech and crypto over the past few months. However, figures show that the red-hot market for the non-fungible tokens (NFTs) is starting to cool off, with a significant decline in sales of the crypto art and collectibles. 

The recent NFT trend has inspired a new wave of users trying to use cryptocurrency. Thanks to this, Ethereum-based cryptocurrency wallet MetaMask reports 500% user growth over the last six months. It has grown from 1 million active users in October to 5 million this month.

Venture capitalists are writing big checks for startups in the booming NFT space. Blockchain developer platform Alchemy, has raised $80 million in a Series B round of funding. Alchemy says it is already powering every major NFT platform, including OpenSea, Nifty Gateway, SuperRare and CryptoPunks. And it plans to be “the Amazon Web Services (AWS) of the blockchain industry”.  

Despite going stratospheric earlier this year, the red-hot NFT market is starting to cool down. 

According to NFT data tracking website nonfungible.com, the total amount of NFT sales has declined by almost 28% between March 30th and April 28th. And the total value of sales fell by almost 14%. 

 

Metaverse NFT Rose Against Market Slowdown

Sales volume for art NFTs declined by almost 42%, making this the sector with the biggest losses. And the sales value dropped from over $71 million to $41.5 million as of 28 April.

Among the sectors including sports and gaming NFTs, metaverse was the only sector that grew in terms of both sales volume and dollars spent in the period. This sector includes virtual land plots and digital properties. Metaverse NFTs sold between March 30th and April 28th were worth almost $21 million, with the prices up by 32%.

What’s next for the NFT market? Dapper Labs, the creator of popular NFT marketplace NBA Top Shot and NFT-powered blockchain game CryptoKitties, announced its plans for the next NFT marketplace. 

Dapper Labs is partnering with Genies, a celebrity-driven avatar technology company to build a new NFT platform. The “Genies Marketplace” will allow users to create and sell digital wearable NFT collections for their avatars.

On the other hand, crypto VC firm Outlier Ventures announced its new idea to implement initial coin offerings (ICOs) with NFTs. 

Outlier Ventures issued a new legal framework, called the NFTSPA, to enable projects to raise money with NFTs in a compliant way. Early investors can buy the NFTs, dubbed as “Access NFTs”, issued by the fundraiser now, for the promise of an exposure to the future franchise value of the NFT project. 

Outlier Ventures has seen the growing trend of crowdfunding efforts around NFTs. It is also preparing smart contracts with its NFTSPA model, as a template for clients for new NFT releases.