Nowadays, tokenized assets, including digital real estate and NFT, and the prices of everything are currently suffering.
This current crypto winter is arguably one of the harshest and longest-lasting bear markets in crypto history. Even worse is how the tokenized assets available in the blockchain space in 2022 aren't restricted to cryptocurrencies alone like they used to be.
In the third quarter of this year, the sales of Non-fungible tokens have been at an all-time low, according to DappRadar, a blockchain tracker. The statistics are so bad, that the demand for some highly speculative blockchain-based assets looks unlikely to return.
NFTs are special kinds of blockchain assets, representing tokenized versions of real-world assets like images, videos, and even music. The popularity of these assets exploded in 2021, following the general rise of cryptocurrencies and the inflow of investors trying to cash in on the rising prices.
However, in 2022, the bear market is in full force, and the demand for NFTs appears to be dwindling.
The average price of NFT sales has also decreased significantly by 92% since the beginning of May 2022, falling from $3,894 to $293, according to data from Chainalysis.
The average amount of NFT sales in the first quarter of 2022, at the peak of the NFT market, was about $12.5 billion. In the second quarter, the value was $8.4 billion; in the third, the value was $3.4 billion.
While the bull market of 2021 fueled the mass adoption of NFTs, investors moved in with a strong appetite for gains and invested heavily in the new trend.
During the bear market of 2022, however, the central bank rate hikes have prompted these investors to ditch their risky assets.
As illustrated by the chart above, the sales of NFTs on the largest NFT marketplace in the world were at an all-time low in September.
The number of customers who buy NFTs every week has also been observed to have halved from January 2022 till the present, according to NonFungible.com.
This is an exciting turn of events because the interest of the overall crypto market in this "new craze" used to be very high.
According to Art Market Research, markets for traditional art NFTs like Bonhams, Phillips, and Sotheby's crashed from a combined market value of 127 million pounds to 8.4 million.
Other more popular NFT collections aren't left out either.
The floor price of major NFT collections like the Bored Ape Yacht Club (BAYC) and others like CryptoPunks and Mutant Ninja have also dropped massively due to the bear market.
The base price of the BAYC collection has fallen to about 79.65 ETH. The value of CryptoPunks has fallen to 48 ETH.
For perspective, the base price of the BAYC collection used to be about 153.7 ETH, and that of CryptoPunks used to be 123 ETH.
Disclaimer: The author's comments and recommendations are solely for educational and informative purposes. They do not represent any financial or investment advice. Always DYOR (do your own research)