NFT Market in Recovery Mode, Bitcoin NFTs Take Off

2023/05/26 08:02:34

Date: May 19 - May 26, 2023

In this NFT recap, we'll delve into all the important developments in the NFT space over the past week, ensuring you stay informed and up-to-date on the latest happenings. NFT is all about attention, and attention shifts quickly! There are many updates and excitement to share on this week’s NFT Market Recap. We hope you enjoy :) 👇

📈Market Overview

🔑Key Takeaways

Overall Market Trend: The NFT market is still recovering this week, consolidating after a significant drop in April. The floor price in the art segment is performing exceptionally well this week. Major companies are still investing in NFTs, while we always seem to be content with the excitement in the updates of a few existing projects.
Trading Volume: NFT trading volume shows a decline from previous highs but with a 27% increase in daily active wallets, indicating strong market activity. Similar to the past week, investor preferences and trends within categories are shifting, while the total activity level in the NFT market is stable.
Fluf World (hiFLUF) experienced a significant price increase of 62.0% with a current floor price of 1.37 ETH.
Sappy Seals (hiSEALS) experienced the biggest hit, dropping 7.1% over the past week, with the floor price now at 0.51 ETH.

🗞️Major NFT Headlines

The CEO of 9GAG confirmed plans to launch a $MEME token, focusing on building a secure and sustainable web3 company.
A CCTV broadcast discussing cryptocurrency unexpectedly featured Meebits, leading to a 15% market increase in value, particularly for rare types like Elephants and Pigs.
Pudgy Penguins announced that a limited edition Pudgy Penguins "Shark Suit". collectible would release this Friday, exclusively on @NTWRKLIVE.
Blur Adds Partial Repayment Feature for Blend Loans.
Hicham Habchi, known for his work on popular IPs such as Valorant, Overwatch, Batman, and TMNT, has joined 0N1 as a creative director and advisor.
Mfers are going fully on-chain to store the collection in the most robust way possible.
Azuki created a new Communities page on the Azuki site.

🚀 Bitcoin NFTs Blast Off

If you have spent time on Crypto or NFT Twitter in the past week, you've seen BTC NFT and Ordinal talk. There was an early boom in February, but now the BTC NFT movement is starting to permeate through the ETH-native NFT audience. Is the hype real, or just a fad? Let's explore what's been happening and why BTC NFTs are the talk of the town.

What's been happening?

Here are a few recent headlines that have caught the market's attention regarding Bitcoin's NFT movement:

Bitcoin NFTs are second in 30-day total NFT trading volume with $170M in sales, behind only ETH ($392M), and 3x higher than 3rd-place Solana.
In the past week, two of the three top projects by volume (wash trading removed) are Bitcoin projects - Space Pepes and the Bitcoin Frogs, combining for over $13M in volume.
Daily Ordinal Inscriptions on Bitcoin have jumped from 3,000-4,000 per day in March to 200,000-400,000 per day in May as the number of Ordinals created approaches 9M.

This is in addition to some past actions from major brands like Yuga and Bugatti choosing to drop projects on Bitcoin. Significant momentum is building. Looking at the data, a solid chunk of that volume is from BRC-20s (basically Bitcoin's version of memecoins, a deep dive for another time), which should be separated from the true NFT volume. But still, the increase in activity is directionally valid. Bitcoin has become a significant player in the NFT space almost overnight.

Why is this happening?

One big reason is infrastructure. Infrastructure on Bitcoin is being developed rapidly. The Bitcoin NFT scene back in February was in the Stone Age. People were trading NFTs tracked on spreadsheets, sending their seed phrases to middlemen to transact, and praying transactions went through.

Now there are several new wallet options. Magic Eden has launched a Bitcoin NFT marketplace. And how-to guides and educational materials are popping up left and right. It's becoming much easier for NFT natives from blockchains like Ethereum or Solana to onboard into Bitcoin and learn how to trade confidently.

Additionally, Bitcoin NFTs have some unique characteristics that ETH and other blockchains don't have. Specifically, the concept of "Sattributes." NFTs on Bitcoin are inscribed directly onto satoshis ("sats"), the lowest denomination of a Bitcoin. This provides provenance options for NFTs beyond their inherent characteristics. Here are a few examples of potentially valuable sats:

Sats tied to the 10,000 Bitcoin involved in the "Bitcoin Pizza" transaction
Sats owned and mined by Bitcoin founder Satoshi Nakamoto
The oldest sats

It adds a new level of collectability that some collectors value, in addition to the NFT itself.

Should you care?

At a minimum, it's time to pay attention to what's happening. You don't need to rush out and buy Bitcoin NFTs. Several I've tracked over the past week are down 30-50%. And frankly, many of the projects seem like they need more effort.

Most of the trending projects on Magic Eden Bitcoin are animal-based PFPs with orange backdrops or derivatives of ETH NFTs. We can do better. But eventually, there will be good projects, art, etc., launched on Bitcoin. Being ready for that is wise, especially if you're an active trader.

How to get started

If you are interested in diving in, this is an easy way to get started exploring the BTC NFT landscape:

Set up a wallet (Xverse and Hiro are two recommendations).
Seed it with a small amount of Bitcoin to transact (from an exchange like KuCoin).
Browse marketplaces, such as Magic Eden or Ordinals. Market (there are several more).

For those who like to read more before jumping in, check out the Lucky Trader Bitcoin NFT guide from the legend Corporate Trash.