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1 in 3 NFTs end up “Dead”
Summary: Despite the popularity in NFTs, one in three end up as a “dead collection,” meaning little to no trading activity, according to a Nansen report obtained by Blockwork on Thursday. “The conclusions are based on observations of blockchain-based collectibles with either fewer than 10 sale transactions in the last 30 days or those that no ...
Despite the popularity in NFTs, one in three end up as a “dead collection,” meaning little to no trading activity, according to a Nansen report obtained by Blockwork on Thursday.
“The conclusions are based on observations of blockchain-based collectibles with either fewer than 10 sale transactions in the last 30 days or those that no longer have a listing on a marketplace,” Blockwork reported.
While some participants buy and sell digital art work, others choose to mint them. Minting is a process where digital art goes from a digital file to the blockchain.
They are stored in a decentralized database or a distributed ledger and cannot be edited, modified, or deleted. Participants usually mint NFTs via Ethereum, Polygon or Solana, through paying fees to do so.
The number of those minting NFTs rose from around 500 to 1.2 million last year: a 2000 times increase in the market. Last year, the NFT market reached its first all-time high. Since then, weekly transactions are up $382k and weekly users are up 194,000.
Nansen showed the data in a graph on twitter:
NFTs come in various shapes and sizes from apes, to video clips, to shoes with real life items attached to them. Sales of NFTs reached some $25 billion in 2021 as the speculative digital asset soared in popularity.
Data is showing a trend towards more affordable projects out-performing the initial minting price signaling a maturation process taking place in the NFT world. In addition, since the beginning of the year, less ether is being used to mint NFTs, once again showing a correction in the marketplace.
It’s not all good news for NFTs. Despite being up considerably YOY, weekly transactions and weekly users are down since the start of the year. In addition the average NFT sale price is down from $6,800 seen in January to just below $2,000.
Stephen Young, founder of marketplace NFTfi, hypothesized to Blockwork that the market is going through changes. The money-grab projects will die, but the broader blockchain-based collectibles are here to stay.
Author: Tyler Irvin
