Monthly NFT sales fall below $ 1 billion for the first time in 12 months

The problems with crypto hedge funds and lenders were the focus of attention in June, but business in the market for non-fungible tokens (NFT) was also hit, with monthly sales falling below $ 1 billion for the first time in 12 months, according to NFT data aggregators CryptoSlam.

For context, June last year was the same month that Axie Infinity exploded in popularity, putting NFTs and games to make money on the map in the process.

Falling cryptocurrencies share some of the blame for poor NFT sales, but unique monthly buyers in June also fell almost 50% from a peak of more than 1 million in January and are now below 600,000 for the first time since July 2021.

In another clear sign, the floor price of a Bored Ape Yacht Club – one of the largest NFT collections – fell below $ 100,000 for the first time in over a year in mid-June to a low of $ 86,277. That’s almost an 80% drop from a peak of more than $ 400,000 at the end of May.

“The NFT market has not been immune to the crypto market (and business) turbulence and when combined with [traditional finance] downturn – especially a crash in technology stocks – is a perfect storm for loss of confidence, “said Jonathon Miller, Australian CEO of the cryptocurrency exchange Kraken, to Reject in shared written comment.

Otherwise known as the “crypto winter”, Bitcoin and the total crypto market value have fallen about 60% since the beginning of the year and over 50% since the collapse of the algorithmic stablecoin project Terra in early May.

The 70% drop in prices this year on Ether, the world’s second largest cryptocurrency, also affected NFT trading, as it is the original token of Ethereum, the most popular blockchain for hosting NFTs. Ether prices traded around $ 1,055 on Monday in Asia.

After a few volatile weeks, however, cryptocurrency prices remained relatively stable over the weekend, with all major currencies fluctuating no more than 1% in 24 hours through Monday afternoon in Asia.

Bitcoin remained stable around $ 19,300 over the weekend after falling below $ 19,000 for the first time since December 2020 on Friday to switch hands to $ 19,133 at press time. In the midst of this downturn in the NFT market, Kraken is set to join the likes of Binance and Coinbase by opening the waiting list for its own NFT marketplace for full release over the next few months.

In the middle of a crypto winter, it may seem like an unfortunate time to launch such a product, but Miller said that the NFT market is still as big an opportunity as crypto was 10 years ago, despite the recent shocks for the blockchain industry as a whole.

“The apparent collapse of closed book lending can in the long run be seen as a reminder that open transparent infrastructure is ultimately the foundation on which a new wave of digital financial tools will be built,” Miller said.

“The projects and businesses that stay as true to this as possible are the ones that can withstand the storm,” he said.

Another way NFT marketplaces or exchanges can stand out from the crowd is by specializing and offering unique services, for example by focusing on sports-based NFTs, according to Anndy Lian, Chief Digital Advisor, Mongolian Productivity Organization, and a blockchain author.

In an interview with Reject, Lian, who also has a background in NFTs, added that the current gloom in the industry will mean that both cryptocurrencies and NFTs are likely to trade sideways for the rest of the quarter, before a wave of renewed interest hits Q4, driven by new blood into the industry.

“I think the NFT market can recover faster than the original crypto market,” said Lian, highlights partnership agreements between Binance and Portuguese football player Cristiano Ronaldo as a sign of what is to come.

“All of these moves, which may cost hundreds of millions, tell us that this will be a great strategy,” he added. “We can not just rely on what you see in kryptonative; you have to get new blood. “