Although NFT projects have repeatedly received financing, transaction data shows that the NFT market has fallen into a downturn

Many NFT projects have received financing this year

This year, NFT-focused companies have recently secured several funding rounds. For example, the well-known Yuga Labs of Bored Ape raised $450 million from a16z in March this year, with a valuation of up to $4 billion.

In April, Glow Labs raised $4.15 million in seed funding for its NFT-related project, which hopes to help "developers deploy a code-free smart contract in seconds, allowing them to create A customized loyalty product."

In early May, Americana raised $6.9 million to help “brands and creators turn physical items like streetwear, collectibles, cars, and art into NFTs.”

Recent NFT-related transactions continue. Zora Labs raised $50 million in May, and its protocol reportedly “allows artists and developers to create NFT marketplaces and collections.” Less than a week later, Arianee announced that it had raised $21 million to “represent partner brands Assist in the work on Digital Certificates of Title and Authenticity". In late May, Ayoken raised $1.4 million for its creator-focused NFT marketplace.

All these financing activities are based on the growth of the NFT market. According to reports, the NFT market has reached $41 billion in 2021, and some people have predicted that the NFT market may double this year. However, it now appears that this may not be the case.

Recent NFT Sales Data Are Dismal

Now let’s examine recent NFT transaction data. We can count the total sales volume of the entire NFT market, and at the same time count the floor price trend of a single popular NFT combination, so as to draw a more comprehensive conclusion.

The Block provides data information on NFT sales, categorized by category, transaction, chain and more indicators, and provides a data set related to transaction value.

Data source: The Block Data

According to The Block, weekly sales of NFTs have dropped by 70% from nearly 1 million in the third week of 2022 to less than 200,000 in the most recent week. The decline in NFT sales is not new, but the extent of the decline has increased in recent weeks, corroborating the view that the cryptocurrency or Web3 market is in a correction period-and some even think that the encryption winter has arrived.

Data source: The Block Data

Since the beginning of the year, NFT transactions have been generally down. But there was a sudden uptick in late April and early May, fueled by sales of Yuga Labs Otherdeed, which appeared to account for nine-figure dollar volume.

To better understand this histogram, we can refer to the data of NonFungible.

The chart below compares the volume of NFTs (red line) and the value of transactions (white line). Note, however, that the chart below is a one-year time frame:

Data source: NonFungible

Directionally, this is in line with what we saw in The Block, where NFT transaction volume and transaction value both saw a clear decline this year, before picking up during the Yuga Labs sale - also thanks to a16z's support.

In terms of floor prices, how are some major NFTs doing? Let's study the value trend of some well-known NFT series, you can refer to the data of CoinGecko:

• Bored Ape Yacht Club's peak floor price: ~$420,000 (~154 ETH), set on May 1, 2020.

• Bored Ape Yacht Club's floor price today: $163,904 (~91.5 ETH).

• Percentage change in US dollars: down about 61%.

• Percent change in ETH: down about 40%.

The difference between these two percentages comes from the value change of ETH, currently the most active chain for NFT projects.

Otherdeeds, part of the larger Bored Ape universe, has also seen its floor price drop significantly. From 5ETH ($14,000+ in early May) to 2.64ETH ($4,659) today, according to data from CoinGecko.

Of course, not all NFTs are falling. For example, the floor price of the goblintown.wtf NFT series has been rising since its launch in late May, although it has pulled back slightly in the past few days. But overall, the data performance of the NFT market is indeed depressing.

The decline in NFT sales and value is also to be expected given the general decline in trading volumes for a large number of assets, both blockchain-based and otherwise. Like the larger economic business cycle, the NFT and cryptocurrency markets experience cyclical changes. We may not need to be too pessimistic, but we should always be prepared for the cold winter.

This article is compiled by Cointelegraph Chinese from

https://techcrunch.com/2022/06/08/the-nft-slump-is-real/

https://techcrunch.com/2022/06/09/the-nft-slump-is-real-really/