The largest market for non-fungible tokens is also reacting to the crypto winter – this stops the NFT hype, but not NFT as a technology.
OpenSea’s marketplace for NFTs has benefited greatly from the hype around NFTs and has risen in a short time from a trading platform with manageable sales to the largest market for NFTs.
After a record-breaking $386 million in January 2022, sales have plummeted in the months since. Compared to peak months, current trading activities are at a very low level.
The crypto winter is also affecting the NFT market
OpenSea CEO Devin Fenzer did last week in a tweet It announced layoffs of 20 percent of its employees. Finzer cites the declared crypto winter as reasons for the action, as well as the bleak global economic situation.
Thus, OpenSea is in the same boat as many crypto and technology companies that have already implemented rounds of layoffs and downgrades. An increasing number of companies are trying to arm themselves against a potential downturn and the sales decline in the crypto environment that has been noticeable for several weeks.
Hype is dying at death speed, NFTs are here to stay
The hype surrounding NFTs built up extraordinarily quickly and with the work “Everdays: the First 5000 Days” by the American digital artist selling out. beep (Mike Winkelman) Consciousness groups wide. The digital collage sold at Christie’s auction in March 2021 for $69 million. This broke the dam, the new art form NFT was discovered and almost everything in between art, object, nonsense and rags fetched high prices if only packaged as NFT (Non-Fungible Token).
The current recession is currently scratching the varnish of the hype, but not the benefits of NFTs. It remains to be seen whether groups like CryptoPunks or the monkeys from the Bored Ape Yacht Club will return to their peak valuations of hundreds of thousands or millions of dollars after the crypto winter.
However, rising sales or crashing prices do not in any way affect the future of the NFT per se. The technology is very good and very practical for that. Artists of all kinds, photographers, composers, authors, and more create their own NFTs as certificates of authenticity, proof of ownership, and deeds of sale for their artwork. NFTs along with trading platforms open up new channels for the art market and increase security for buyers of art and other things.
Therefore, the crypto winter can calm the overheated price structure, the exaggerators cut their wings and end the hype prematurely. However, the temporary stalemate with the effects of normalization paves the way for NFTs as a greatly expanded future after the crypto winter.