NFTs dominated the headlines from late 2020 throughout 2021 before peaking in early 2022. By November 2020, global NFT sales reached around $8 million.
NFT market down 92% from January 2022 peaks: is it the best time to invest?
However, approximately 13 months later, this amount had risen to more than $6 billion. This rapid growth is partly due to increased liquidity in the market as a result of interest rates falling to record levels. Due to accommodative policy, the Bitcoin, Ethereum, Solana, and even BNB Chain ecosystems have grown.
Two years later, NFTs are in disarray and struggling. Throughout 2022 and 2023, the trajectory has been downward, looking at CryptoSlam data. When writing on October 9, the global sale volume of all NFTs reached around $100 million in early October.
This number is nothing compared to the peak reached in January 2022 when top NFTs like Bored Ape Yacht Club (BAYC) and CryptoPunks sold for millions of dollars.
Despite the devastation of NFTs, one analyst at X He believes This may be the best time to build and invest in these assets. With the market down 92% from January 2022 peaks and back to late 2020 levels, the analyst says a call option is the “ultimate contrarian” and could be “the right bet.”
However, deciding to load now, even when the “perfect” bottom is reached, is risky. according to CryptoSlamthe number of unique buyers and sellers slows down. Although prices recovered from September 2023 to early Q1 2024, interest has waned.
In September, sales fell to $296 million, compared to $373 million in August. It also represents a collapse of nearly 70% from the $1.7 billion recorded in December. If cryptocurrency prices continue to collapse, sales will likely be affected.
Impact of cryptocurrency prices and regulations
According to Cryptoslam, Ethereum Lead In NFT activity. Over $44 billion worth of NFTs have been traded on Ethereum, with $5.8 billion on Solana alone and $1 billion on Solana. $4 billion on Flow.
For this reason, if ETH prices fall below $2,100 and the lows in August, the likelihood of NFT activity on the platform diminishing will be increased.
Beyond prices, the industry is facing more regulatory pressure from the US Securities and Exchange Commission. Open sea receive Wales notice in late Augustindicating the regulator’s plan to file a lawsuit.
Featured image from Canva, chart from TradingView
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