Form function to shutter market amid Solana NFT decline
Formfunction, a Solana (SOL)-based nonfungible token (NFT) marketplace, has announced that it is closing up shop after just 13 months of operation amid a decline in Solana NFT prices and trading volume.
On March 15, Formfunction announced that it would “shut down” on March 29, saying it “cannot continue to operate.” The decision was made after “much discussion and careful consideration,” it said.
We have some sad news to share today – Formfunction will be closing on Wednesday 29th March.
This was an extremely difficult decision; however, after much discussion and careful consideration, we have come to the conclusion that we cannot continue to operate Formfunction.
— Formfunction (@formfunction) March 15, 2023
The exact reason for shutting down the platform was not disclosed in the announcement.
Formfunction’s head of community and marketing, known by the pseudonym Magellan, tweeted on March 15 that the co-founders and team will “pivot to a new direction, likely outside of crypto [and the] SOL-plass”, but did not give further details.
It is with deep sadness to say that @formfunction will sunset and shut down as the co-founders and team pivot to a new direction, likely out of the crypto and SOL space.
A thread with a personal statement & reflections 1/n
— Magellan◎☀️ (@CryptoMagellan) March 15, 2023
Cointelegraph reached out to Formfunction’s co-founders – Matt Lim and Katherine Liu – for comment, but did not immediately receive a response.
The marketplace’s closure comes after its launch just over a year ago, on 3 February 2022. According to Magellan, over that time it sold $5 million despite a “brutal bear market.”
Shortly after launch, the platform also raised a seed round of $4.7 million in March 2022 led by venture capital firm Variant Fund and contributions from other VC firms Solana Ventures, Canonical Crypto, Pear VC, Palm Tree Crew Crypto and OpenSea Ventures.
Since Formfunction’s launch, the wider Solana NFT area has declined in terms of volume and floor prices alongside a decline in the price of SOL.
Figures from Solana NFT data aggregator SolanaFloor show the index of blue chip NFTs on the blockchain has seen a 75% price drop in dollar terms since the beginning of February 2022.
The daily number of buyers of Solana NFTs has also seen a decline over the past 12 months. According to data from CryptoSlam, daily unique buyers are currently hovering around 7,000, almost half the amount seen on average at the start of 2022.
SOL’s price has also dropped since Formfunction’s launch. At the start of 2022, SOL was trading at around $100; it has now fallen over 80%, and at the time of writing was trading around $19.
The price of SOL took a significant hit in the collapse of FTX in November 2022 and has struggled to regain traction since. FTX founder Sam Bankman-Fried was an early investor in the Solana blockchain.
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Notable NFT collections first native to Solana are also apparently leaving the platform.
Last December, DeGods and y00ts – two top-performing Solana NFT projects – announced that they were bridging Ethereum and Polygon to “explore new opportunities” and to allow continued growth of the collections.
