Some say that NFTs were a passing phase and that the market for them has already peaked. Others are not so sure. Whilst Google searches for NFTs are down by a third since January, and volume on OpenSea has fallen by 65% since the beginning of February, a recent report by Nansen, a blockchain analytics platform, suggests NFTs are not just another crypto fad.
Paul Harwood, a product manager at Nansen, told The Defiant “I think we’re seeing more successful projects. We’re seeing the market mature and the real innovative projects really taking off and maybe the cash grabs not doing so well.”
A year ago there was a slew of ‘dead’ minted NFY projects: the definition of a ‘dead’ product is one that has fewer than 10 sales in 30 days. Back in January 2021, these made up 50% of NFT projects, but a year later that figure is closer to 20%.
The report suggests that the average NFT mint price is dropping, as the market gets more competitive and project leaders lower prices. Those projects that are enjoying “much higher sums than their mint price is happening amid insane growth of NFT minters,” Harwood says. Indeed, in January 2021 there were only 500 NFT minters, and now there are 1.2 million. That is a huge growth.
Utility NFTs are also growing. Javier Cerdán González, a research engineer at Nansen said that whilst the Bored Ape NFTs may garner a lot of attention, there are many more NFTs with a “prosaic utility”, especially on the Solana blockchain, which appears to be favoured by utility driven projects.
What we are seeing is a maturing market that is entering a new phase. There may be less hype around them, but that doesn’t mean it’s game over — just as with ICOs, some projects will disappear, and others will continue to thrive. And there are still many more projects to come.