Ethereum NFT Production Hits Record Low in September: Report
The fervor surrounding Ethereum-based NFTs appears to be waning, with September’s primary sales dropping to an unprecedented low of $17.5 million USD – a 12.4% decrease from August’s $20.5 million USD, according to data from Forkast Labs.
This bearish trend, however, isn’t confined to Ethereum alone. The Polygon blockchain also saw NFT production dip to a seven-month trough of $4.7 million USD in September. Having said that, 2023 has witnessed a substantial growth of 219% for Polygon NFT production since January.
Blue-Chip NFTs Losing Steam?
Right now, many of the industry-leading blue-chip NFT collections, including Bored Ape Yacht Club (BAYC) and CryptoPunks, have indicated the overall NFT market sentiment, with holders beginning to question the actual value these digital assets afford.
Last week, Yuga Labs, the parent company of the above-listed NFT collections, announced that it would be restructuring its entire organizational infrastructure, beginning with a massive layoff that impacts many of the company’s U.S.-based teams.
BAYC’s valuation has recently nosedived by over 60% from its May 2022 peak, paralleling the trend observed in other popular NFTs like CryptoPunks, which plummeted 60.4% from its October 2021 zenith.
The current NFT market decline is heavily attributed to the reality that we’ve all been waiting for – the loss of interest by NFT investors and/or the right questions finally being asked in response to the many unfulfilled promises made by these projects.
In other words, investors appear to prioritize intentionality over hype and “FOMO”.
The data from Forkast Labs also reflects a dramatic 84.4% year-to-date drop in NFT service revenue on Ethereum, plummeting to $6 million USD in Sept. 2023 from its $38.7 million USD benchmark in January.
OpenSea vs. Blur
The ongoing battle between rival NFT marketplaces OpenSea and Blur has continued to grow, thanks to the ongoing royalty debate.
However, both marketplaces have proven vulnerable to these declines, according to data from The Block, with OpenSea witnessing a 31.8% decline in monthly trading volume in September and Blur experiencing a 38.3% reduction.
It’s Time for Real-World Use Cases
The NFT landscape transcends beyond just digital art, where the key to the emerging tech’s survival is real-world applicability that doesn’t require the average consumer to teach themselves the inner mechanics of Web3, blockchain, cryptocurrency, and digital assets like NFTs.
It’s more than “building a community,” as most of these companies and projects have relied upon for their overly hyped launches. It’s about enhancing and improving the everyday efficiencies and functionality of the world around us. If it doesn’t impact an individual in some way as they sit at home on their couch, the NFT’s existence is irrelevant.
Despite the overall market decline, global brands such as Starbucks, Mattel, and Crocs have continued their journey into Web3 by incorporating NFTs into their loyalty and rewards programs and marketing campaigns that still provide IRL value to consumers and their respective customers.
Editor’s note: This article was written by an nft now staff member in collaboration with OpenAI’s GPT-4.