The NFT market recorded its weakest performance since 2020, with trading volumes falling 19% compared to 2023, according to new data from DappRadar.
The report shows that NFT sales figures also fell 18% through 2024, indicating a continued decline in market activity.
Trade volumes fluctuated throughout the year, reaching $5.3 billion in Q1, before falling to $1.5 billion in Q3, and recovering to $2.6 billion in Q4.
Despite higher token prices, especially ETH, the lower sales accounts indicate less market participation.
2024 Q1 started with reasonable strength
NFT market decline in 2024 shows different patterns across different quarters. Q1 started with relative strength, as trade volumes reached $5.3 billion, marking a 4% increase over the same period in 2023.
However, this trend did not last, with Q3 volumes falling to $1.5 billion, showing one of the lowest quarterly numbers in recent years.
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The market saw a partial recovery in Q4, with volumes rising to $2.6 billion. This increase coincided with higher cryptocurrency prices, especially Ethereum, which directly affects NFT valuations.
The data shows that while individual NFT prices rose in line with the rise in ETH values, the number of actual sales fell, indicating a decrease in market participation.
The trading pattern reflects a shift in market conditions, with fewer higher value transactions taking place.
This change appears to be linked to several factors: institutional traders focusing on high-grade aggregates, retail investors showing less interest in lower-priced NFTs, and a ' broader impact of cryptocurrency market conditions on NFT valuations.
The smaller sales volume, despite higher individual transaction values, suggests a more concentrated market with fewer active participants.
Fixed NFT collections versus mixed results
In 2024, established NFT collections faced mixed results, with Pudgy Penguins standing out as a standout performer despite broader market challenges.
The collection saw a 44% decline in sales volume, but the floor price rose 114%. This price increase followed the brand's expansion into physical retail, with Pudgy Penguins products appearing in major stores such as Walmart, Walgreens, and Target across the United States, as well as Selfridges and Argos in the UK.
Yuga Labs clusters, which were previously the market leaders, saw a reduction in trading volume and floor prices.
The company behind Bored Ape Yacht Club and CryptoPunks changed its strategy, focusing on developing the alternative metaverse platform.
Before the end of the year, Yuga Labs announced plans for 2025, including a new collaboration with PP Man.
Gaming-related NFTs became the most active segment by sales count, reflecting the gaming sector's continued expansion into digital assets.
This trend aligns with players' interest in real ownership of in-game items and the rise of player-driven economies in blockchain games.
The NFT Market is facing several challenges in 2025
The NFT market enters 2025 facing several structural changes after a challenging 2024.
OpenSea's challenges went beyond market conditions when it received the Wells Notice from the SEC in August 2024, which led to a 56% reduction in its workforce by November.
Magic Eden emerged as a stronger competitor in 2024, expanding beyond its Solana roots to include Ethereum, Polygon, Bitcoin, and newer networks such as Base and Arbitrum.
The platform's December launch of its ME token, backed by a $700 million airdrop, added a new element to the platform competition landscape.
Looking towards 2025, the market is showing early signs of adapting to current conditions. The expansion of NFTs into practical applications such as gaming, music, and real estate indicates a market that is moving beyond mere speculative trading.
Source: https://www.thecoinrepublic.com/2025/01/15/nft-trading-volumes-fell-to-the-lowest-since-2020-dappradar/
