How to Navigate the NFT Bear Market Even as Ethereum Dominates and Wallets Surge
Date: July 8 - July 14, 2023
In the past week, the Non-Fungible Token (NFT) market has shown signs of consolidation following a period of high volatility. Sales volumes have declined, and prices have reached a more stable state, indicating a possible maturation of the market or a precursor to a larger downturn. Ethereum continues to lead the market, accounting for 55% of all NFT sales, while Solana secures the second spot with 13% of the market share.
Despite the overall low trading volumes in the NFT market, CryptoPunks and Sappy Seals have demonstrated resilience. Meanwhile, the average royalties on platforms like Art Blocks have remained steady, contrasting with a decline on other platforms. Read on to learn more about all the latest updates from the NFT market over the past week. We hope you enjoy :) 👇
📈Market Overview
🔑Key Takeaways
- The NFT market has been consolidating in recent weeks following a period of high volatility. Sales volume has declined, and prices have stabilized. It could signify that the market is maturing or a precursor to a larger decline.
- Ethereum continued to dominate the NFT market, with 55% of all sales. Solana was the second-largest blockchain for NFT sales, with 13% of the market.
- Low trading volumes were observed in the overall NFT market, with strength in CryptoPunks and Sappy Seals.
- Royalties on platforms like Art Blocks have held steady, while other platforms show declining average royalties.
- The number of active wallets in the NFT market increased by 27%, from 1.1 million to 1.4 million.
🗞️Major NFT Headlines
- Sound.xyz Secures $20M in Series A Funding, Launches Open Platform for Artists to Establish Fairer Music Model
- Snowfro Advances Towards Final Mint with 81 New Squiggles, Including Donations and Gallery Consignment
- Google Play Introduces Policy Update Allowing Developers to Integrate NFTs into Apps and Games
- 7-Eleven Celebrates 96th Birthday with Launch of "Find Your Slurpee Vibe" Digital Collectible
- Bored Ape Yacht Club (BAYC) Set to Launch "Made by Apes" IP Tool with On-Chain Verification
- 9Gag Reveals Exciting Details for $MEME Token Sale, Prioritizing Captainz and Offering Bonuses for Full Crew & Super Crew Holders
🚨Navigating the NFT Bear Market: A Look Back at Lessons Learnt
Key Takeaways:
- Over 80% of hyped NFT projects from 2021 have become irrelevant by 2023.
- Oversaturation and lack of utility often lead to the decline of NFT projects.
- The Ether NFT project's pause in minting and collection reduction signals poor strategy and execution.
- Curators like Fracton Protocol play a key role in identifying valuable NFTs and safeguarding investors.
- Future NFT strategies should focus on learning from past mistakes and prioritizing intrinsic value.
The volatile world of NFTs continues to surprise investors as we navigate the bear market in 2023. An insightful analysis of past trends reveals a sobering fact: more than 80% of the highly-touted NFT projects from 2021 have slipped into obscurity, providing valuable lessons for future decision-making.
Not unlike traditional financial systems, market dynamics play a significant role in the NFT landscape. Initial price surges, often fueled by novelty and the prospect of owning 'unique' digital assets, eventually confront reality as the initial hype wanes.
A case in point is the Ether NFT project. The team's unexpected decisions to pause minting and reduce the collection raised eyebrows - indicators of poor execution and flawed strategies. Such radical actions, when not necessarily warranted, could suggest a lack of conviction, ultimately leading to undesirable outcomes.
The downfall of most super-hyped NFT projects can be attributed to oversaturation and lack of utility. The increasingly crowded digital market puts downward pressure on prices, leaving only projects with intrinsic value to hold their ground. Additionally, NFTs purchased for speculative gain struggle to maintain their value if they fail to offer additional utility post-hype.
The Ether incident further illustrates this point. While the team may have had grand plans for diverse revenue streams, the execution faltered. Rather than focusing on building and adding value, their drastic measures hinted at a weak strategy, unfortunately common in the world of Profile Picture (PFP) NFT projects.
To navigate this complex and fast-paced market, the role of curators is invaluable. Identifying potential NFT projects and filtering out the noise adds an essential layer of expertise to an otherwise chaotic environment.
In conclusion, the volatile journey of super-hyped NFT projects offers invaluable lessons for future strategies. Poor understanding of market dynamics, flawed strategies, and shoddy execution are pitfalls to avoid. On the other hand, projects offering real utility and intrinsic value, backed by robust strategies, are worth considering.
We must approach the NFT space with a discerning eye and informed decisions, recognizing the essential role of curators in identifying potential. It's equally crucial for project founders to make smart decisions since trust is a fragile commodity in this market.