SVB Collapse Tanked NFT Trading Volume, DappRadar Report Suggests

by James · March 16, 2023

Blockchain data platform Dappradar released a report on Wednesday that explores the aftermath of the Silicon Valley Bank (SVB) collapse and its impact on non-fungible token (NFT) trading activity and volume.

According to Dappradar, there were only 12,000 active NFT traders on Saturday 11 March – the day after the bank closed – a figure not seen since November 2021. Saturday was also the lowest number of individual NFT trades in 2023 so far, a total of 33,112.

Since the beginning of March, NFT trading volume has fallen by 51%, with a decline of about 16%, Dappradar says.

However, not all NFT collections were affected in the same way. Projects from NFT giant Yuga Labs, including Bored Ape Yacht Club and CryptoPunks, saw their floor prices dip slightly on Saturday, but quickly recovered. A Twitter user compared CryptoPunks to USDC, claiming it was more stable than the stablecoin, which lost its link to the US dollar after SVB’s collapse.

Sara Gherghelas, a research analyst at DappRadar, told CoinDesk that Yuga Lab’s success has been boosted by its investment in CryptoPunks as well as its ability to build communities. Although the company said it had limited exposure to SVB, the token holders did not make much of a move on the news.

“They have a very clear roadmap, the team is visible, and they decided to deliver a good project after the Ape ecosystem,” Gherghelas said. “They keep building, they show that if you’re part of their community, they have so many benefits.”

Not all collections made it through the SVB collapse unscathed. Shortly after the news broke on March 10th, Proof, the NFT collective behind the popular compilation Moonbirds, took to Twitter to say that the company had invested some funds in SVB, which triggered uncertainty among the owners.

Over the weekend, Moonbirds lost roughly 18% of its value, according to Dappradar. A whale sold 500 Moonbirds on March 11th, incurring losses between 9% and 33% totaling over 700 ETH, or about $1.1 million.

Gherghelas told CoinDesk that while the news of Proof’s exposure to SVB added uncertainty to the project, people were told to sell because of the company’s shortcomings in recent months. After canceling the Proof of Conference scheduled to take place in May, the community has become uncertain about the company’s ability to keep its promises.

“People, users and consumers are becoming more discerning and they don’t want hype, they want the benefits, the benefits and the utility behind that NFT collection,” Ghergelas said.