NFT Sales Are Flatlining – WSJ

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The NFT market is collapsing.

According to data website NonFungible, non-fungible token (NFT) sales averaged around 19,000 a day this week, down 92% from the September peak of around 225,000.

The number of active wallets in the NFT market fell 88% last week from a high of 119,000 in November to about 14,000. NFTs are digital tokens like Bitcoin and act like certificates of ownership that exist on the blockchain.

Rising interest rates have crushed risky bets across financial markets. NFTs are one of the most speculative.

Since hitting a high in November, the tech-intensive Nasdaq Composite has fallen 23% and Bitcoin has fallen 43%. The Federal Reserve plans to raise interest rates this week and next month. As the central bank’s easy-money policy came to an end, investors began to look at more defensive stocks, such as consumer staple foods.

Many NFT owners are aware that the value of their investment is significantly less than at the time of purchase.

NFT of the first tweet from Twitter Inc..

Co-founder Jack Dorsey sold it to Malaysia-based blockchain company Bridge Oracle CEO Sina Estavi for $ 2.9 million in March 2021.

Earlier this year, Estavi put the NFT up for auction. He hadn’t received a bid over $ 14,000, but he didn’t accept it.

Estavi said the auction failure was not a sign that the market was deteriorating, but a normal fluctuation that could occur in any market. He said the NFT market is still developing and it is impossible to predict what it will look like in the next few years.

“This NFT is my capital, so I don’t regret buying it,” he said.

Another NFT buyer bought a Snoop Dogg-curated NFT titled “Doggy # 4292” in early April for about $ 32,000 worth of cryptocurrency ether. An image of a green astronaut that looks like a star in the Hollywood Walk of Fame, the NFT is currently auctioned and is priced at $ 25.5 million. The current highest bid is 0.0743 ether, which is about $ 210.

Sales volume of non-fungible tokens by category, daily

Avatar, animals and other digital assets

Gameplay items such as equipment and weapons

Works created manually or by calculation

Accessories, real estate and other items used in

Virtual world

Avatar, animals and other digital assets

Gameplay items such as equipment and weapons

Works created manually or by calculation

Accessories, real estate and other items used in

Virtual world

Avatar, animals, etc.

Digital assets

Gameplay items such as equipment

Or weapon

Works created manually or by calculation

Accessories, real estate and other items

Used in virtual world

Avatar, animal,

Other digital assets

Gameplay items such as

Equipment or weapon

Manually created work or

On the calculation

Accessories, real estate

And other items used in

Virtual world

Avatar, animal,

Other digital assets

Gameplay items such as

Equipment or weapon

Works created manually

Or computationally

Accessories, real estate

And other items used in

Virtual world

That lack of interest is not unique. According to Google Trends, interest in NFTs, measured by the number of searches for this term, peaked in January and has declined by about 80% since then.

The imbalance between supply and demand is also damaging the NFT market. According to data from analytics firm Chainalysis, there are about 5 NFTs per purchaser. As of the end of April, the company said 9.2 million NFTs were sold and 1.8 million people bought them.

The largest crypto exchange in the United States is still betting on NFTs. Coinbase launched a beta site last month, with 4 million people signing up. This will allow users to connect their existing wallet to the site and initially buy and sell NFTs without transaction fees or create NFTs through the site.

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In 2021, the profile of NFTs as part of the zeitgeist soared as musicians, artists, celebrities and businesses were on the rise. Artist Beeple sold the NFT associated with his artwork for $ 69 million.Adidas AG and Nike Inc...

We cast and sold NFTs tied to sneakers.McDonald’s..

Sold NFT related to re-release of McRib sandwich.

Collectors could distinguish between NFTs that catalog a huge set of cartoon-like characters like CryptoPunks and customized NFT art projects inspired by major artists who are already enjoying museum followers. There are signs that there is.

Among the artists who are doubling NFT art is New York artist Jeff Koons. An artist known for oversized balloon animal sculptures is selling a series of NFTs attached to actual sculptures scheduled to launch rockets later this year. His gallery, Pace, said his moon-shaped sculptures attached to his NFT are actively sold as packages for $ 2 million each.

The rise of play-to-earn video games where gamers trade NFTs gives a glimpse of how Metaverse attracts users with monetary rewards and the associated pushback.Photo Illustration: Josephine Chu

Earlier this month, the NFT art platform TRLab was launched by Cai Guo Qiang, an internationally renowned Chinese artist for creating works using gunpowder, to help buyers create their own digital fireworks displays. He said it took only one minute to sell out the 7,000 NFTs. ..

Zach Friedman, co-founder and chief operating officer of cryptocurrency broker Secure Digital Markets, says that what makes NFTs stand out right now is the perks or utilities that come with them.

Director Kevin Smith will sell 5,555 NFTs related to the upcoming movie “Kilroy was here”. Only those who own an NFT can access the movie.

A band called Crystal Method is auctioning NFTs associated with new songs, including a behind-the-scenes pass to a concert and dinner with the band.

“The continuation certainly focuses on utilities,” Friedman said.

— Kelly Crow contributed to this article..

Write a letter to Paul Vigna at [email protected]

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