The total value of Ethereum-based non-fungible tokens (NFTs) has decreased by 60% in the last 12 months.
DappRadar reported that the total value of the NFT sector decreased by almost 60% in 2022, going from $9.3 billion to $3.7 billion.
The blockchain analysis company DappRadar has released a new study on the marketcap of the 81 largest Non-Fungible Token (NFT) collections on the Ethereum network. The report provides an in-depth look at the current state of the NFT market and the potential for future growth.
2/ The market cap for 81 Ethereum collections analyzed by our machine-learning algorithm experienced a decrease of 59.60% in USD value, from $9.3B in the beginning of 2022 to $3.7B at the end of the year.
— DappRadar (@DappRadar) February 9, 2023
In a recent report released by DappRadar, it has been revealed that the collapse of Terra Luna in May 2022 was the primary cause of an 88% decrease in the market cap of NFT projects running on Ethereum by June 2022. The report also states that the NFT market cap losses on Ethereum are continuing to decline, with a 75% decrease in the market cap of NFT projects since April 2021. The report further speculates that the decline in the NFT market cap is due to the increased competition from other blockchains and the introduction of more sophisticated and efficient ways of managing digital assets.
The recent drop in the market cap of non-fungible token (NFT) projects was not due to a lack of investor interest, but rather to the manipulations of malicious actors in the ecosystem. This has been identified as a primary cause of the broader collapse of the cryptocurrency industry, as during the FTX crash the market cap of the entire NFT industry followed suit and dropped in tandem with the global crypto market. This indicates that bad actors have been manipulating the market and taking advantage of the greater volatility of the crypto industry. Going forward, investors should remain aware of the potential for such manipulation and be mindful of the risks associated with investing in digital assets.
NFTs Generate Record Earnings on Ethereum Since 2022
In 2021 and early 2022, several projects have seen remarkable growth in market capitalization, according to a recent report. Three projects in particular, Azuki, Pudgy Penguins, and Degen Toonz, have experienced impressive appreciation of up to 260%. These three projects experienced market cap increases of 113.89%, 260%, and 204%, respectively. This is an incredible achievement and shows the potential of these projects and their ability to generate capital. These projects are certainly ones to watch in the future as they continue to grow.
The latest NFT projects have seen explosive growth since the dissolution of Terra Luna, with The Potatoz, Renga, DigiDaigaku, and God Hates NFT leading the charge. The Potatoz has seen a market capitalization growth of 134.68%, Renga has grown a staggering 211.63%, DigiDaigaku has achieved 209.88%, and God Hates NFT has seen a 1,653.28% growth in market capitalization.
In spite of the challenging bear market Ethereum has faced this past year, several Ethereum-based projects have managed to experience impressive growth. Despite a 60% drop in ETH, the network's native currency, these projects have seen a steep increase in their own success. This speaks to the resilience of the Ethereum network and its associated projects, as well as the strength of the Ethereum market as a whole.
Ape Yacht Club Crushes the Competition
Yuga Labs, the parent company of the Bored Ape Yacht Club project, has established itself as a leading player in the world of Non-Fungible Tokens (NFTs) despite the exponential fall of other projects. According to data from DappRadar, Yuga Labs was the clear leader in the Ethereum network’s NFT market, with no other projects coming close in terms of market share. This is a remarkable achievement for the company and shows its commitment to the NFT industry.
Amidst the tremendous success of Yuga Labs, which accounts for over two-thirds of the entire non-fungible token (NFT) market on Ethereum, Bored Ape Yacht Club experienced a major dip in market capitalization. From a high of $2.6 billion at the end of 2021, their market capitalization had plummeted to $934 million by the end of 2022, representing a 64.92% depreciation.
After a period of stagnation, it appears that the Non-Fungible Tokens (NFT) ecosystem is finally beginning to show some signs of relief and potential growth. Trading activity around blue-chip collections has recently spiked, with NFTs even taking precedence over the Bitcoin network. This suggests that the crypto market might be on the brink of a much-needed recovery, and that NFTs and their associated ecosystems could potentially benefit from the resurgence.