Cryptocurrency
96% of NFTs Deemed ‘Dead’ as Market Struggles with Speculation and Volatility
The non-fungible token (NFT) market has witnessed explosive growth, followed by significant downturns over the past few years. Despite the initial hype and heavy investment, it is now grappling with severe instability.
According to a report from nftevening.com, a staggering 96% of NFTs are considered “dead” based on three factors – zero trading volume, minimal 7-day sales, and inactivity on Twitter.
NFT Market Decline
After examining over 5,000 NFT collections and collected 5 million transactions from NFTScan, nftevening found that over 4 out of 10 or 43% of NFT owners are currently unprofitable. Moreover, the average lifespan of an NFT is only 1.14 years – 2.5 times shorter than that of traditional crypto projects.
This brief lifespan highlights the highly speculative environment of NFTs, where swift price swings and the allure of digital assets often fail to sustain long-term worth.
nftevening stated,
“The data paints a clear picture: the NFT market previously praised as the future of digital ownership and investment, is encountering significant difficulties. The high unprofitability rate among holders, the stark contrast between successful and failing collections, and the short lifespan of NFTs all suggest that the market may not be the golden goose many had hoped for.”
A closer look at individual NFT collections revealed a significant disparity in profitability. According to the platform’s findings, the Azuki collection is the most profitable, with holders earning over 2.3 times their initial investment. This success is largely due to the collection’s strong community support, distinct artistic style, and strategic marketing efforts.
On the other hand, the Pudgy Penguins collection highlights the risks in the market, with holders experiencing a drastic 97% loss, making it the least profitable collection so far.
Oligopoly in 2024
From a period when OpenSea held a monopoly during the NFT bull run, the market evolved into a duopoly between it and Blur, and by 2024, it became more of an oligopoly with increased competition and diversity among marketplaces.
According to a recent CoinGecko report, the number of NFT marketplaces with a yearly market share above 10% has grown from just 2 in previous years to 4 this year. Blur solidified its leadership as the leader in 2023, capturing 62.4% of the market share in February and surpassing OpenSea as the dominant player for most of the year.
OKX briefly overtook Blur at the end of 2023, driven by the Ordinals hype, which boosted OKX’s NFT trading volume from $8.35 million in October to $311.36 million in November and then to $684.65 million in December.
Tensor also experienced significant growth, with its market share rising from 0.1% to 12.1% as monthly NFT trading volume surged from $1.36 million to $215.57 million, allowing Tensor to surpass its close competitor Magic Eden for the first time in December 2023.
In contrast, OpenSea, which began the year as the largest platform with a monthly NFT trading volume of $438.08 million (41.0% market share), saw a gradual decline, ending the year at $171.10 million in volume (9.6% share).
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XRP seems to have found support around 50 cents. Can buyers push the price higher this week?
Key Support levels: $0.50
Key Resistance levels: $0.54, $0.68
1. Price Finds Support
After a sharp fall last week, bulls appear to be back. XRP opened this Monday in green and is keen to return on an uptrend. As long as the key support at 50 cents holds, buyers have a good chance to return on the offensive.
2. Sellers are Retreating
Early October saw a spike in sell volume, but now sentiment across the market is improving, which could see the momentum shift back into the bulls’ favor. If so, buyers can aim to take XRP back above 60 cents. However, once there, sellers could return, as in late September.
3. MACD Momentum Shifting
After a difficult start this month, the momentum on the daily MACD is showing the first signs of a reversal, with a histogram making higher lows. If this trend continues, buyers could soon take over the price action and push XRP to break higher again.
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The price of Bitget’s BGB token unexpectedly dropped by 50% on the morning of October 7 before beginning to recover.
The platform has announced that it will compensate users for any losses resulting from the sudden volatility, which is still under investigation.
Exchange Promises Full Compensation
According to CoinGecko data, the incident saw the token’s value fall from $1.14 to $0.64 before staging a quick recovery. In a post on X, Bitget addressed the situation, saying, “BGB experienced unexpected volatility today due to market conditions, but the price has quickly stabilized.”
The platform reassured its users, promising to fully compensate for any asset losses. It also announced that a detailed compensation plan would be released within 24 hours, with the entire process set to be completed within 72 hours.
Bitget CEO Gracy Chen reiterated this message in a separate X post:
“The incident is still under investigation, but I want to assure everyone affected that we will not let any Bitget users suffer losses.”
Chen emphasized that Bitget’s overall standing remains strong, noting that the platform achieved a global market share of 11% in the third quarter of 2024, making it the fourth-largest exchange globally. Additionally, it boasts an asset reserve exceeding 176% and holds the second-largest protection fund globally, which is designed to compensate users quickly in the event of such incidents.
The Nature of Flash Crashes
Meanwhile, this incident mirrors a past development that occurred earlier this year with OKB, the native cryptocurrency of the OKX exchange. The token faced sudden price collapses, falling from a high of $48 to $25 within hours. The event was reportedly triggered by several large leveraged position liquidations, leading to further sell-offs and price declines.
At the time, OKX responded by reassuring its users that it would compensate them for the losses incurred from the unusual liquidation. While OKB’s crashes were linked to market-wide volatility, Bitget has yet to pinpoint the exact cause behind today’s event.
A cryptocurrency “flash crash” occurs when several holders rapidly sell a specific crypto asset, surpassing buyer demand and causing the price to drop sharply in a short amount of time. Unlike a typical collapse, the price usually recovers quickly, often returning to a level close to where it started.
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[PRESS RELEASE – Dubai, UAE, October 7th, 2024]
On October 22-23, the Blockchain Life 2024 forum will take place in Dubai. Over 10,000 participants from 120 countries will come together for the crypto event to share industry insights on the eve of Bull Run 2025.
Participants will hear from leading voices in the blockchain space, who will share market analysis on market trends and potential future developments.
Confirmed figures include:
- CEO Tether – Paolo Ardoino
- Co-Founder Animoca Brands – Yat Siu
- CEO Ledger – Pascal Gauthier
- CEO Cardano Foundation – Frederik Gregaard
- CEO Dubai Blockchain Center – Dr. Marwan Alzarouni
- Co-Founder Litecoin Foundation – Xinxi Wang
- CEO Vechain – Sunny Lu
- CEO of dYdX Foundation – Charles d’Haussy
- Founder Listing.Help, Jets Capital – Sergei Khitrov
- Founder DWF Labs – Andrei Grachev
- Co-Founder Tezos – Arthur Breitman
- CEO Trust Wallet – Eowyn Chen
- Co-Founder Osmosis Labs – Sunny Aggarwal
- Co-Founder of Sui (Mysten Labs) – Kostas Chalkias
- Head of Investments at Maelstrom Fund – Akshat Vaidya
- Founder Notcoin – Sasha Plotvinov
- Co-Founder, CEO Celestia Labs – Mustafa Al-Bassam
- Google Cloud – Tiago Henriques
- Program Lead MetaMask – Zied Brini
In addition to the lineup of speakers, Blockchain Life 2024 is also set to include behind-the-scenes discussions that will provide an opportunity for networking and exchanging information on the latest advancements in the sector.
The forum is coming soon. Readers can purchase tickets with a 10% discount using promo code chainwire.
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