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Total value of Ethereum NFT collection decreased nearly 60% in 2022

Total value of Ethereum NFT collection decreased nearly 60% in 2022

In 2022, NFTs felt the effect of bad actors and market manipulators. Those introduced after the beginning of the crypto winter performed well.

A report from DappRadar that came out on Feb. 9 looked at 81 collections of nonfungible tokens (NFTs) on the Ethereum blockchain and found that their market capitalization would decline sharply in 2022. The losses were not all the same, though.

More details

DappRadar estimated that the Ethereum NFT market was worth $9.3 billion at the beginning of 2022. By the end of the year, it was only worth $3.7 billion, which is a loss of 59.6%. The prices were affected by the price of Ether:
“It is also important to consider that ETH lost 60% of its value last year, which had a strong influence on the value of the NFTs.”

The NFT market reached its peak in February 2022, when it was worth $19.1 billion. It did better than Bitcoin and Ether until the Terra market collapsed in May. NFTs had lost 88% of their value by the next month. At the end of November, when the FTX fell apart, the market hit its lowest point of the year, at $2.2 billion. From that low point, the market went up 68% by the end of the year. Noted in the report:
“This retraction of the NFT market was not a reflection of NFT’s utility, but rather a result of bad actors and market manipulations.”

In 2022, two-thirds of the market was controlled by Yuga Labs. Its CryptoPunks and Bored Ape Yacht Club collections held 46.7% of the market by themselves. The loss leader for Yuga Labs was the Otherdeed collection, which fell 86.15%.

The only collections “launched in 2021 or early 2022 that saw significant market cap growth” were Azuki, Pudgy Penguins, and Degen Toonz. Each of these rose by 113.89%, 260%, and 204%.

The report also looked into why collectibles’ share of the NFT market is going down. Collectibles had more than 90% of the market at the beginning of 2022, but by January 2023, they had less than 75%. In January 2023, $870 million worth of NFTs were traded.

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