- OpenSea Daily Volume Down 70% From The Highs
- Fee Revenue Falls 97% For The Largest NFT Marketplace
Non-fungible tokens, or NFTs have blasted into the mainstream as digital artwork on the blockchain has sold for millions of dollars around the world.
While NFTs have nearly caught up with physical painting sales over the past two years, many people are still sceptical about the new technology, citing environmental concerns.
Negative sentiment seems to be spreading in the markets as fears of inflation and the Russia-Ukraine crisis have sent prices lower, in line with the wider global markets.
We at the Bankless Times decided to do some further research to see how the NFT markets have fared amidst this turmoil.
Here’s what we found…
OpenSea Experiences Dramatic Fall in Daily Trading Volume
OpenSea is the world’s most popular NFT marketplace.
It was recently valued at over $13 billion after a new funding round raised $300 million.
Looking at the data, there is a clear uptrend in daily NFT trading volume up until the end of January where it forms a peak.
Since then, trading volume has remained in a downtrend, now averaging around $70 million daily.
This means that looking at this metric alone, NFT trading activity has declined by over 70%.
Fee Revenue Plummets for NFT Marketplace
Our most stark finding relates to the monthly fee revenue generated by the top NFT marketplace, OpenSea.
According to the data, the platform saw a huge spike in revenue after August 2021 and this trend peaked in January 2022, after achieving a record $386 million in fees for the month.
In February, this figure fell by 52% to $204 million and despite being halfway through March, the platform has only generated $7 million in fees so far.
When doubling this figure to account for the second half of the month, $14 million still represents a 97% drop in revenue for the platform since the peak.
It seems that NFT activity has all but ground to a halt.
Closing Thoughts
The NFT markets are not unique in their descent from the recent highs.
Uncertainty due to inflation and the Ukraine crisis has impacted markets globally.
Even the S&P500 which was making new highs almost weekly has been unable to match its previous gains, now down over 12% from the peak.
The markets are likely to stay volatile and in a risk-off mode until the conflict is resolved and more is done to curb the impacts of inflation.
