WSJ says ‘the NFT market is collapsing’

    The WSJ article claiming that the NFT market is collapsing doesn’t tell the whole story, since contrary data shows that the market is consolidating.

    In the same week when the top five collections alone accounted for more than $1 billion in primary and secondary sales, a Wall Street Journal story claimed that sales of non-fungible tokens (NFTs) are “flatlining.”

    According to data from Nonfungible, an NFT market analysis platform, the number of NFT sales has plummeted by 92 percent since an all-time high in September 2021. Since a high in November 2021, wallets engaged in the Ethereum (ETH) NFT market are claimed to have dropped by 88 percent.

    ‘NFT market is collapsing’ is false as proved by other data.

    Onchain data from Dune Analytics’ dashboard, on the other hand, suggests that the NFT market is still thriving, with statistics indicating that NFT users and transactions are substantially higher than Nonfungible claims. The volume per day in USD on Ethereum NFTs has been among the biggest recorded since February, according to analytics, with popular marketplace OpenSea witnessing about $550 million in volume on May 1 alone.

    When looking at OpenSea transactions and USD volume, Tom Schmidt, a partner at venture capital company Dragonfly Capital, finds a similar picture. Within the NFT market, sub-sectors are forming, and although certain segments of the oversaturated market are experiencing a decline, others are witnessing significant advances.

    NFTs are thriving even better

    NFT market is collapsing is a completely wrong statement, since the data proves otherwise. Nansen’s analytics engine, which monitors NFT collections by category, reveals that “Blue Chip” NFTs – well-known and highly respected brands like the Bored and Mutant Ape Yacht Club and Azuki tokens — surpass art and gaming tokens by a wide margin. The Nansen Blue Chip-10 Index, which tracks the top 10 NFT projects, is up 81 percent year to date (YTD), while the indexes tracking the top art and gaming NFT collections are down 39 and 49 percent, respectively. The pattern of NFT market money concentrating in the top collections was highlighted in an analysis by NFTstatistics.eth, which posted a chart in late April demonstrating how the top 5 collections are driving the Ethereum NFT market.

    Right now, there’s a clear pattern that five or six of the most successful projects are sharply outperforming while the rest are flat to down, “NFTstatistics.eth,” a pseudonymous NFT market analyzer, told Cointelegraph.

    NFTs reaching record-breaking levels

    Nonfungible’s data shows a spike on May 1, with the number of purchases and active wallets that day reaching levels not seen since November 8, 2021, directly aligning with the world record-breaking event (and Ethereum breaking). Yuga Labs’ metaverse land sale, on the other hand, refutes the allegation that NFT sales are “flatlining.” It’s unclear why the Nonfungible data used by the WSJ differs from Dune’s, although it could be due to Nonfungible’s inclusion of sales numbers from P2E game Axie Infinity.

    According to CryptoSlam data, volume for the popular play-to-earn touched an all-time high of over $40 million on November 4, 2021, before gradually declining to under $500,000 today.

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