Lido NFTs Axed from Nansen’s Service After Mint Volume Mishap By CoinEdition

by James · May 23, 2023

Due to a technical issue causing a misleading increase in NFT coin volume, blockchain analytics platform Nansen has excluded Lido NFTs from the NFT haven service.
The incident led to a misleading increase in NFT coin volume, involving 430k ETH, which was initially misinterpreted as an increase in NFT market activity.
Nansen has indicated that the NFT market is not yet back to full strength despite growth in Q1 2023.

Blockchain analytics platform Nansen has announced the removal of Lido NFTs from the NFT Paradise service. Nansen’s NFT Paradise is a platform that offers detailed analysis on the NFT market, helping users understand transactions, trends and dynamics. Nansen’s decision was influenced by user votes following a recent mishap involving Lido, a decentralized finance (DeFi) platform. Lido’s staked withdrawal requests were misrepresented as NFTs, leading to an unexpected increase in NFT coin volume.

Lido stated last month that users would receive NFTs as part of the deposit withdrawal procedure. Every time a user withdraws Ether, the decentralized finance protocol issues NFT certificates, which are used to claim their ETH tokens.

The massive peak, involving a whopping 430k ETH (roughly $780 million), was initially interpreted as a surge in the NFT market. However, further investigation revealed that this was due to a technical problem rather than real market activity. Nansen went on to clarify that the NFT market is not yet back to robust health, dampening expectations of a rapid recovery in the near future.

Nansen has previously stated that through the 1st quarter of 2023, NFT trading volumes in Ethereum (ETH) and USD were on the rise. Specifically, a total of 2,839,354 ETH were transacted in Q1, compared to 1,525,471 ETH in Q4 the previous year. March 2023 marked an annual peak in NFT sales. This increase was largely driven by Blur, an emerging NFT marketplace that quickly overtook established marketplaces to lead the industry in sales.

Despite the increase in sales and users during the 1st quarter, a decline was observed in the NFT market in April. Transaction volumes in April decreased compared to March, and this trend appears to have continued into May. The total number of NFT holders also increased modestly in Q1 2023, reaching 13,999,528 compared to 11,233,872 NFT holders in Q4 2022.

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