On February 9, DappRadar published a report showing that the Ethereum NFT market capitalization decreased by 59.60% from $9.3 billion in 2022 to around $3.7 billion in early 2023.
DappRadar’s study is based on an analysis of the market capitalization of 81 of the largest NFT pools operating on the Ethereum network.
2/ The market capitalization of 81 Ethereum blockchains analyzed by our machine learning algorithm saw a 59.60% decline in the value of the USD, from $9.3 billion at the start of 2022 to $3.7 billion at the end of the year.
– DappRadar (DappRadar) February 9, 2023
According to DappRadar, the Terra Luna crash in May 2022 was the main reason for the 88% market capitalization loss for NFT projects running on Ethereum in June 2022.
So the decline in the market value of NFT projects was not due to lack of interest from investors, but to manipulation by bad actors in the ecosystem. This is probably the main reason for the broader collapse of the crypto industry, since during the FTX crash, the entire NFT ecosystem’s market capitalization crashed after the global crypto market.
This was the highest grossing NFT pool on Ethereum since 2022
The report indicated that some of the projects that were launched in 2021 and early 2022 achieved “significant growth in market value,” reaching 260%. Among these projects are the Azuki, Pudgy Penguins, and Degen Toonz groups, which increased their market capitalization by 113.89%, 260%, and 204%, respectively.
Among the latest NFT projects launched after the Terra Luna crash are: The Potatoz with a market capitalization growth of 134.68%, Renga with a growth of 211.63%, DigiDaigaku with a growth of 209.88% and God Hates NFT with a growth of 1,653.28%.
It is worth noting that all of these projects managed to achieve significant growth, despite ETH, the native currency of the Ethereum network, seeing a 60% price drop over the past year due to the bear market.
Bored Ape Yacht Club dominates the market
According to DappRadar, Yuga Labs, the parent company of the Bored Ape Yacht Club project, has dominated the Ethereum network NFT market and “established itself as a leading player in the NFT industry,” despite the accelerating decline of other projects.
While Yuga Lab’s fundraising accounts for 67% of the total NFT market cap on Ethereum, Bored Ape Yacht Club’s market cap saw a 64.92% drop from $2.6 billion to $934 million at the end of 2022.
However, this did not stop Yuga Labs from purchasing two of the largest NFT pools on the market, CryptoPunks and Meebits, for an as yet undisclosed sum. Both groups are already seeing a significant rebound after suffering declines of up to 60% in 2022.
But now that the cryptocurrency market is showing signs of recovery, the NFT ecosystem is likely to have a chance to breathe. And we may see greener pastures in the future, as trading activity around major conglomerates has been picking up recently, and now there are even NFTs taking over the Bitcoin network.
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