NFTs were all the rage in 2021. Digital artists were raking in millions from elite nerd collectors, and celebrities found a new way to flex on the gram with ape-like JPEGS. While some of us struggled to understand the hype, we were reassured by our tech overlords that this was a new frontier of fortune that couldn’t be missed. However, it’s been a different story this year. Whether it’s due to the economic downturn, an infestation of scammers or the pandemic hangover beginning to wear off, digital assets have plummeted in sales and value. And unfortunately, the pain doesn’t seem to be easing anytime soon.
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The world’s five largest NFT marketplaces witnessed another slow month in November. Total sales across OpenSea, Magic Eden, X2Y2, LooksRare and Solanart combined was US$394.02 million, down by over US$100 million or -20% compared to October. November set a new record low for monthly NFT sales volume combined this year. However, OpenSea, the largest NFT marketplace in the world, saw more trading volume this year to date compared to last year. OpenSea has reached 27% more trading volume this year to date (US$16.54 billion) compared to 2021 (US$13.06 billion).
John Stefanidis, Co-founder and CEO of Balthazar said it’s understandable for NFT sales to have declined this year, but more applications for the technology are starting to develop.
“It makes sense for the NFT market to have slowed down this year due to macroeconomic pressures as well as the three cataclysms of 2022: Terra Luna, Three Arrows Capital and FTX. We’ve seen interest rates rise and disposable incomes tighten, volatility in stock markets. People have lost trust and are being more cautious.
“What we’ve seen is obviously a decline in sales largely for NFT images and art, but what we’re starting to see is really cool and different applications of NFTs. For instance, someone bought a house with NFT technology. So perhaps in 2023, 2024 and onwards, when you buy an NFT it won’t just be buying a piece of digital imagery, you’ll actually buy something bigger that’s attached to that photo. And you can also buy the tokens from the companies that create that technology. So it’s a really exciting, thriving space but understandably, people are waiting for more uses of the technology.”
While we continually wait for these “exciting use cases”, let’s all laugh at Justin Bieber’s NFT fail. Bored Ape Yacht Club hype was in full swing at the start of the year, with celebrities fighting over each other to get into the pricey Ethereum NFT collection. But the buzz faded amid a crypto bear market, and the price to join the exclusive club dropped lower and lower. And a “floor” Bored Ape, like the one that singer Justin Bieber spent USD$1.3 million worth of ETH to buy in January, now sells for a tiny fraction of that price point. According to NFT Price Floor, the current floor price of one of his precious primate-themed NFTs is roughly 58.2 ETH or about USD$69,800.
Ouch, JB. With a net worth of only USD$300 million, we pray the music icon recovers from this financial disaster.
Next time you think you’re down bad, just remember that .@justinbieber just bought a floor ape for 500 ETH.
— gmoney.eth (@gmoneyNFT) January 29, 2022