‘It’s Probably Gonna Be a Huge Cry Fest’: Plunging Crypto Markets Cast a Shadow Over NFT.NYC and Its Jittery True Believers
It's a grim moment for the opening of this year's NFT.NYC.
The speakers are going on stage at a time when crypto markets are crashing hard—Bitcoin and Ether have both lost more than 70 percent of their value since November. Media headlines are filled with stories of crypto firms unraveling. The NFT market is also feeling the pain. All told, it’s a grim time to be peddling NFTs. New NFT projects aren’t seeing anywhere near the momentum they did a year—or even a few months—ago.
Japanese artist Takashi Murakami recently apologized to his fans on Twitter after the prices of his flower NFTs, released in May, took a nosedive.
Francis Kim, an Australian-based entrepreneur behind the NFT project AI-Zuki, is experiencing similar struggles. “I launched my collection like two days ago. I’ve not seen my millions yet,” he half-jokingly told Artnet News. “Bad timing maybe.”
He spent $5,000 to generate his digital art collection and the return so far has been zero. Kim, who made news earlier this year after losing an eye-watering amount of money on crypto margin trades, is not attending NFT.NYC because of the travel costs.
“I feel like a victim in every story,” he said.
It is difficult to get a clear picture of precisely what is going on in the NFT market since most of the data on trades comes from the NFT marketplaces themselves. The three main gauges of market performance include platform volume, floor prices on blue-chip NFT projects, and market sentiment—none of which look good right now.
Although OpenSea still holds the position of being the busiest NFT marketplace, its average selling price, the number of traders, and sales volume are all down. On May 20, the platform had a daily trade volume of $43 million; on Tuesday, daily trades were less than half of that—17 million.
Coinbase spent $600 million on its new NFT marketplace, which was supposed to inject the ailing crypto exchange with new growth, but it hasn’t taken off as planned. After attracting $75,000 in trading volume when it swung open its doors to the public on May 4, activity has dwindled, with a volume of just $19,000 on June 20, according to Dune. Recently, the firm said it would cut a fifth of its staff amid the market downturn.
So-called “blue-chip” NFT collections are also troubled. Bored Ape Yacht Club, one of the most popular ethereum NFT projects, with more than $2.2 billion worth of trading volume to date, has seen a drop off amid the market upset. The cheapest available Bored Ape NFT is down more than 13 percent over the past 30 days, at a current price of 80 ETH ($91,000), per NFT Floor Price.
ApeCoin, the token of the Bored Ape Yacht Club ecosystem and its future Otherside game, has lost 85 percent of its value. After reaching a high of $27.57 on April 28, right before the Bored Ape Yacht Club launched its Otherside land sale, it’s now trading at a dismal $4.48, according to CoinGecko.
Similarly, CryptoPunks hasn’t been immune to the crash. Its floor price is 67 ETH ($76,000), down 33 percent in the last 30 days, according to NFT Floor Price. And, Meebits, which was launched in 2021 by Larva Labs, the same firm that created CryptoPunks, is down 5 percent in the last 30 days, at a floor price of 4.8 ETH ($5,472).
All three of these “decentralized” collections, representing the top NFT collectibles, are now overseen by Yuga Labs.
Market sentiment is dropping as the voices of NFT critics grow louder in the bear market. Microsoft co-founder Bill Gates said the other day that NFTs are “100 percent based on greater fool theory,” and then added, sarcastically, “Obviously, expensive digital images of monkeys are going to improve the world immensely,”
Adam McBride, who documents the early history of NFTs, keeps a long-term perspective in mind as the wider cryptocurrency market crashes hard. “I’ve said since the middle of last year we would come to an ‘NFTs are BS’ moment at some time during a bear market,” he told Artnet News. “Who knows how low we can go. But I definitely have a number where I’m going to buy a couple of CryptoPunks.”
Meanwhile, people who bought at the top aren’t faring well. Someone who purchased a Bored Ape in early May is down by 70 to 80 percent in dollar terms, said Kim. “NFT.NYC is probably gonna be a huge cry fest.”
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