NFTs Return From the Grave
The NFT market underwent a significant downturn throughout most of 2022 and continued to struggle into the majority of 2023. However, a notable change occurred in the last quarter of 2023, when the market began to show signs of revival, embarking on an upward trajectory. This leads to the pertinent questions: What is the current state of the NFT market, and who are the key players, including dominant marketplaces and projects, driving this resurgence?
A new sheriff in town
In 2021 and 2022, the vast majority of trading activity of Ethereum-based NFTs took place on the OpenSea platform. However, due to OpenSea’s fees, user interface and lack of trading incentives, many NFT traders began seeking alternative platforms. One such platform is Blur, a decentralized marketplace launched in October 2022.
Source: Dune.com/hildobby
Since its inception, Blur has emerged as the dominant force in the NFT market, representing over 75% of total weekly trading volume, totaling approximately $144M. Although OpenSea still accounts for roughly 18% of total trading volume, it has experienced a significant decline.
Source: Dune.com/hildobby
An intriguing observation is that, despite OpenSea's smaller share of trading volume, it boasts a higher number of daily and weekly traders compared to Blur. This disparity can be attributed to Blur's emphasis on targeting professional NFT traders, as opposed to the predominantly retail-focused approach of OpenSea. Consequently, the heightened activity of professional traders on Blur explains its substantially higher trading volume compared to OpenSea.
Source: Dune.com/hildobby
Riding the wave
When observing blue-chip NFT projects like Pudgy Penguins and CryptoPunk, an intriguing correlation becomes clear. In late August and early September, the NFT market hit a low point, experiencing its lowest trading volume in two years. Around this time, Ether began an upward trend, rising from approximately $1600 to its current value of $2900. As the price of Ether climbed, a corresponding increase in NFT trading volume, the number of traders, and the floor price of these main projects was observed. As a result, some NFT sets can act as an interesting beta investment opportunity for investors, uniquely leveraging Ether price action.
Source: https://nftpricefloor.com/