The NFT market is facing a challenging period, with several key metrics such as users, volumes, and liquidity velocity recording massive drops. A staggering pullback in various primary collections sees some plunging by 90% or more. However, despite the gloomy scenario, a few niche subsectors are showing promise.
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Art outperforms other NFT categories
Pockets of strength are emerging amidst a tumbling market. As per Nansen’s NFT indexes, the art sector, particularly the Nansen Art-20 index, is outperforming others, recording a decline of just 40% compared to other sectors that have dipped by 50% or more.
The Art-20 index suggests that artistic NFTs using autonomous systems, known as generative art, is a remarkably resilient niche. Chromie Squiggles from Artblocks, for example, has seen a modest 1.7% decrease over the past 30 days. Terraforms, a creation by generative artist Mathcastles, also only dropped 5%.
Old School NFTs making a comeback
Historically significant collections are also staging a comeback, overshadowing their newer counterparts.
In December 2021, the Bored Ape Yacht Club’s floor price surpassed that of the Cryptopunks collection. Many believed this signaled a shift in dominance from an established collection to a rising star. This notion seemed to solidify when Yuga Labs, BAYC’s creators, purchased the intellectual property rights to CryptoPunks in March 2022.
Yet, the tides have shifted again. As the bear market continues, CryptoPunks have re-emerged as the dominant NFT collection. Current data shows CryptoPunks with a floor price of 47 ETH, in contrast to BAYC’s 27 ETH. The higher rarity prices of CryptoPunks further amplify their standing, boasting an estimated market capitalization of 772,000 ETH, dwarfing BAYC’s 291,00 ETH.
Recent data amplifies this contrast. Over the last month, BAYC’s floor price dipped by 24%, while CryptoPunks experienced a minor 3.8% drop.
Report paints a bleak picture
According to recent data from analytics platform Nansen, the NFT market has seen a year-to-date drop of 40%, while the Blue Chip 10 index has experienced a 33% decline.
Among the blue-chip collection, some have fallen considerably more than others. Azuki, previously touted as a favorite during the bull run and credited for garnering its parent company, Chiru Labs, a $300 million valuation, witnessed its floor price plummet from 33 ETH to a mere 3.9.
Similarly, the Moonbirds collection, backed by Kevin Rose, slipped from its April 2022 high of 36 ETH to just 1.29 ETH. Overall, the NFT landscape remains uncertain, with no clear sign of recovery on the horizon.