NFT Sales Fell Of The Cliff As Cryptocurrency Crashes

Non-fungible tokens have been swept up in the cryptocurrency crash as sales reached a 12-month low in June.

NFTs confer ownership of a unique digital item – often a piece of virtual art – upon someone, even if that item can be easily copied. Ownership is recorded on a digital, decentralized ledger known as a blockchain.

Sales of NFTs totaled just over $1bn (£830m) in June, according to the crypto research firm Chainalysis, their worst performance since the same month last year when sales were $648m. Sales reached a peak of $12.6bn in January.

“This decline is definitely linked to the broader slowdown in crypto markets,” said Ethan McMahon, a Chainalysis economist.

The NFT ecosystem recorded its worst performance this year in June 2022, with total daily sales of around 19,000 and estimated sales of $13.8 million. This number is equivalent to June 2021.

But it’s worth noting that last year, the new ecosystem became mainstream in a variety of use cases, According to data from nonfungible.com, the NFT ecosystem recorded the highest daily sales of 224,768 NFTs worth $78.3 million on September 24, 2021. However, the highest sale was on May 1, 2022, with the sale of 118,577 NFTs worth $780.4 million.

The main factors that have a negative impact on the NFT boom are falling Ether (ETH) prices, lack of demand in the secondary market, and unrealistic gas bills. As a result, as NFTGo data show, NFT’s market capitalization has fallen by nearly 40% and trading volumes have fallen by more than 66% over the past three months with daily NFT sales remaining at the same level.