[et_pb_column type=”4_4″][et_pb_text admin_label=”Text”]Into the Q1 and Q2 NFT Market Report of NonFungible.com. breaking down the first half of the NFT market and trends, during the cryptocurrency bear market, and the forecast of the market growth.
- NFT plummeted in H1 2022, after reaching the all-time high in early 2022.
- Most of the significant indexes have “fallen off the cliff”.
- “The NFT market has not been great, but there is still great momentum,” Nick O’Neill.
Q1 and Q2 NFT Market Report
Booming in the year 2021, Non-fungible Token (NFT) became Collins Dictionary’s word of the year and was not without a good reason. In essence, an NFT is a chunk of digital data that records to whom a piece of digital artwork or a collectible belongs. NFTs saw a meteoric rise in mid-2021 that ushered in a storm of interest, even from outside the crypto-metaverse. According to a report from DappRaddar, NFT trading reached $22 billion in 2021, up from $100 million in 2020.
However, after hitting an all-time high in January of 2022, the trend had begun to dwindle. The NFT ecosystem recorded its worst performance of the year in Q2, 2022, especially in June, when the market crash occurred. Current data from NonFungible.com shows that volume of dollars traded in Q2 2022 was $8,070,349,275, which was 25% lower than the previous quarter.
The NFT crash continues. According to new data, NFT sales volume is now at its lowest since last year amidst an ongoing cryptocurrency meltdown. Sales volume of NFT decreased 20%, from $12,639,781 to $10,105,967. Moreover, OpenSea, the largest NFT trading platform in the world, saw its sales volume drop by 75% since last month. The significant decrease was actually at OpenSea’s lowest since July 2021.
As a reaction to the downward trend of the cryptocurrency market, there was a massive 88 percent drop in Google searches for “buying NFTs”. Similarly, the term “sell NFT” saw an 86 percent decrease in its search interest, which was 52 on a scale of 100, at the start of 2022, to a score of 7, in June, according to Bankless Times’ reports. It appears that there were 100,000 weekly vendors for 132,000 weekly purchasers, resulting in the ratio of buyers to sellers being, at its lowest, 1.32.
Since cryptocurrency continues to operate in a bear market, NFT price experienced the impact of the market on it. The majority of NFTs are Ethereum-based, and the average price of ether dropped by 66%, which in turn has reduced the value of down NFTs tied to the cryptocurrency, taking away almost 75% of the value of NFTs. This had caused the activity in the NFT market to also witnessed a significant drop. Between January and June, the weekly average of active wallets decreased by 57 percent, from roughly 450,000 to fewer than 200,000.
“The NFT market has not been great, but there is still great momentum,” Nick O’Neill, CEO, and co-founder of The Nifty said to TechCrunch.
Why so optimistic? Despite trading volume being down, what NFT collectors consider as quality assets have appreciated in price as the collector market has been rotating toward those,” Brian Cho, general partner, and co-founder at Patron said to TechCrunch. “Even NFT projects like Moonbirds and Bored Apes have largely recovered from their lows in ETH terms.
According to the research of NonFungible.com, the forecasted market size value of NFT will be $20.44 billion in 2022, market revenue will be more than $200 billion in 2030, and Compound Annual Growth Rate will be 33.9%, from 2022 to 2030. According to Grand View Research, there are three factors that contribute to the projection.
First is the growing demand for digital artists worldwide. Second is the growing use of cryptocurrency globally since it is the most common way to purchase digital assets. Lastly, the funding raised by NFT companies is also one of the major factors favoring market growth. According to the 2021 Dapp Industry Report of DappRadar, Venture Capitals and Funds had already invested an amount of more than $2.5 billion in NFTs, in the first quarter of 2022, especially in gaming and metaverse.
Based on historical stats, it is evident that crypto functions like any other market; sometimes up, sometimes down. However, the most important thing is for innovators to build valuable products round the clock.
NFT market, in specific, and the cryptocurrency market, in general, have been facing very dark days, after the most successful periods. However, there are more underlying strengths than you may know. To stay tuned with the market and trends in the second half of the industry, subscribe to our weekly newsletter via firstname.lastname@example.org. [/et_pb_text][/et_pb_column]