Think the cryptocurrency market has it rough? Take a look at what happened to non-fungible tokens – aka NFTs.
Data from DappRadar shows that trading volume at OpenSea – the world’s largest NFT marketplace – recently logged a daily volume figure that was down by 99% from its all-time high. While the company contested the figure to some degree, it admitted that the substantial slowdown in activity is both real and expected.
The Sad State of NFTs
According to DappRadar’s statistics page, the daily trading volume of ETH at OpenSea peaked above $400 million on May 1st. By comparison, the platform only generated $5 million in ETH volume on August 28th.
In an email to CryptoPotato, OpenSea noted that the figure is a bit exaggerated, as it compares a day of unusually high volume to a day of some of the platform’s lowest volume. It also said that measuring volume in ETH, rather than dollars, was preferable to eliminate ETH’s price volatility from the equation.
Indeed, the magnitude of the volume decline decreases when denominated in ETH, a cryptocurrency that itself has fallen almost 50% since May 1st. According to Dune Analytics, OpenSea volume from May to July fell by 62%, but is heading for more pain in August.
The fallout continues a general downward trend that began in January. Monthly volume has fallen by 90% since then when denominated in dollars, and 82% when denominated in ETH.
Meanwhile, OpenSea’s daily user count has fallen from 58,870 on January 9th to just 23,620 on August 27th. Daily transactions fell from 137,500 to just 53,300 across the same timeframe.
NFT floor prices – meaning the lowest value NFT in any given collection – have also tanked across the year. Bored Apes are now going for 72.4 ETH at the cheapest, compared to 153 ETH on April 30th, according to NFT Price Floor. Similarly, CryptoPunks has fallen from 84 ETH to 67 ETH since last month.
OpenSea VS Crypto Winter
The crypto and NFT market slowdown have had a major effect on OpenSea’s operations. In July, the firm was forced to lay off 20% of its staff in preparation for what CEO David Finzer thinks could be a five-year crypto winter.
Nevertheless, Finzer remained long-term-bullish on NFTs at the time. “During this winter, I expect that we’ll see an explosion in innovation and utility across NFTs,” he said in a statement.