Insights and analysisEditorial office

It’s alive! The great comeback of the NFTs in 2023

Igor Grigorchenko

News editor

Jan 19, 2023 at 05:36

In January 2023, the NFT market, to the surprise of many, saw a significant revival. We used data from Delphi Digital’s latest report (NFT Debrief) to identify the reasons for the growth of this market, also looking at new NFT marketplaces and cases of brands entering the NFT market.

 

The market recovery

According to Delphi Digital’s report, the first signs of an NFT market reversal began in December 2022. 

Whereas, according to the NFT Debrief, the NFT market grew even more in January 2023. After a months-long trend of declining NFT sales, we can cautiously declare the beginning of a recovery in this market.

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The report states:

NFT sales volume rebounded significantly in December, finally breaking the downward trend. Blur recorded double the volume of OpenSea during the period.

In addition to the mentioned marketplace Blur, which showed outstanding results, it is also worth noting the success of another unusual platform — NFTPerp.

NFTPerp is a decentralized exchange for perpetual futures on NFT collections. NFTPerp exceeded 16,000 $ETH in trading volume in December 2022 and is on track for an even better month in January 2023.

Speaking of marketplaces, note two things:

  • The successful launch of new NFT marketplaces during the prolonged crypto winter indicates a clear presence of stable demand among NFT buyers.
  • The important point is that both marketplaces are focused on advanced NFT users and offer a complicated product; and this is not a problem (or maybe, on the contrary, a decisive plus). Probably, this is a signal to others that it is not necessary to focus on curious and casual users of crypto, it is necessary to focus on people professionally engaged in this field.

And the last intriguing chart shows that the NFT market (red on the chart) is aggressively growing within the entire crypto ecosystem, wresting popularity from its closest competitor, DeFi (blue on the chart):

This original metric is calculated based on the number of active smart contracts in these two related areas and says that NFT is growing not only in absolute numbers but also relative to its “crypto competitors.”

What’s the total takeaway?

To summarize, three factors contributed significantly to the resurrection of the NFT market in January 2023:

  • Market growth was stimulated by the super successful launch of a new NFT marketplace called Blur. In December, the turnover of this marketplace, promoted under the slogan “NFT for Professional Traders” was $484 million. For comparison, this is almost twice as much as the traditional market leader OpenSea during the same period. 
  • The overall growth of the crypto market, which started in January 2023, also provided an important growth impulse for NFT. All sectors of the crypto industry are closely interconnected, and the long crisis of traditional crypto has negatively impacted new sectors (so-called “new age crypto”) such as NFT, DeFi, or GameFi.
  • There are a lot of big brands coming into the market and testing new models to better engage their customers. NFT is ideal for creating a club or fan loyalty program, and we’ve seen a peak in such experimentation in recent months. These test market penetrations of NFT have been (unexpectedly for many) so successful that we suggest elaborating on these cases further below.

The arrival of brands

To illustrate the trend, we have selected only a few bright cases of brands entering the NFT market in early January 2023.

  • The NFT collection from The Shiboshi Club, in collaboration with Bugatti, was in great demand on the market. It sold out in just four minutes!

Experts from the studio Nakalikes (which specializes in Web3 development) commented on the high demand for these NFTs: 

“We are blown away by the incredible demand of the @shibtoken and @BugattiGroup NFT drop and humbled to have been a part of it. Sold out in a record-breaking 110 seconds!”

  • The official NFT collection of the popular TV series “Game of Thrones” was sold out in just seven hours. Twitter users laughed at the quality of the images, which were clearly hastily and carelessly made. But that didn’t stop the successful sale.
  • National Geographic will release an NFT collection of sunrise photos called “GM: Daybreak Around the World.” The NFTs will be released on the Polygon network. 
  • Something interesting is happening in the airline industry as well. Spanish low-cost airline Vueling is going to accept NFTs, both its own and others’. Argentinian air carrier Flybondi from September 2022 began issuing tickets in the form of NFT. If necessary, users can resell them. A month ago, American Airlines and Air Canada added support for using the SHIB token to pay for their flights.

The success of these cases, according to experts, leads to viral infection — other brands see this successful experience of competitors and also begin to plan to enter the NFT market for themselves (typical case of FOMO).

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