The NFT boom was fueled by a robust and bullish crypto ecosystem as well as optimistic investor attitude. Nonetheless, Bitcoin’s bear market had a negative effect on the cryptocurrency ecosystem.
Nonfungible tokens (NFT) seized the spotlight in 2021, when musicians, influencers, A-list celebrities, and the sports business discovered a fan interaction mechanism that let the general people to profit from their success. However, the excitement around NFT failed to withstand the brutal bear market of 2022, as sales plunged to one-year lows.
The NFT boom, which began in early 2021 and lasted until May 2022, was sustained by a strong and bullish crypto ecosystem and optimistic investor attitude. However, Bitcoin’s (BTC) inability to maintain its all-time high values had a negative effect on the entire crypto economy.
In June 2022, the NFT ecosystem experienced its poorest performance of the year, as the total number of daily transactions decreased to approximately 19,000 with an estimated value of $13.8 million – a figure that was previously observed in June 2021.
Last year, though, daily NFT sales of a comparable amount were regarded as noteworthy, as the young ecosystem witnessed mainstream implementations in a variety of use cases.
According to data from nonfungible.com, the NFT ecosystem experienced its largest daily volume of 224,768 NFTs worth $78.3 million on September 24, 2021. The largest sale in terms of monetary amount occurred on May 1, 2022, when 118,577 NFTs were sold for $780,4 million in a single day.
Falling Ether (ETH) prices, a lack of secondary market demand, and unreasonable gas fees are some of the primary issues negatively hurting the enthusiasm around NFTs. According to data from NFTGo, the NFT market value has decreased by about 40 percent over the past three months, while its trading volume has decreased by over 66 percent.
Despite the bear market, crypto entrepreneurs such as Changpeng “CZ” Zhao are assisting governments in exploring NFT use cases for citizen identification. Facebook, another social media giant, just announced plans to enable NFTs for creators.
We're launching NFTs on Facebook! Excited to share what I've been working on with the world. pic.twitter.com/TaV66zRanV
— Navdeep Singh (@navdeep_ua) June 29, 2022
A spokeswoman for Meta disclosed that the introduction of NFTs on Facebook would be incremental, commencing with chosen U.S. producers.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.