The Harsh Reality of Non-Fungible Tokens (NFTs)
Non-fungible tokens (NFTs), which were once the talk of the town in the digital art and collectibles world, are now facing a harsh reality check. A recent study conducted by dappGambl, a Web3 review website, has revealed that over 95% of NFT collections are currently worthless. This burst of the NFT bubble comes after a period of extravagant sales and hype, where digital art pieces were being sold for millions of dollars.
The study analyzed data from CoinMarketCap and NFT Scan and examined a total of 73,257 NFT collections. Shockingly, 69,795 of these collections had a market capitalization of zero Ether (ETH). This means that millions of people are holding NFTs that hold no tangible value.
The study’s findings have been widely shared within the crypto community on social media platforms. Some members have even admitted that the NFT market is now “super dead.”
Explosive Growth Followed by Cooling Market
The NFT market experienced explosive growth in 2021 and 2022, reaching a peak monthly trading volume of $2.8 billion. During this time, high-profile collections like Bored Apes and CryptoPunks were selling for millions, and celebrities like Stephen Curry and Snoop Dogg were jumping on the NFT bandwagon.
However, as the study reveals, the market has significantly cooled down since then. An overwhelming 79% of all NFT collections remain unsold, creating a buyer-friendly environment at the expense of desperate sellers. Even when filtering out lower-value projects, most collections hold little value today.
Among the top 8,850 collections by market cap, 18% are worthless, and 41% are priced at a modest $5 to $10. Less than 1% of collections are valued above $6,000, which is a stark contrast to the million-dollar deals that were once commonplace.
Hot Take: NFT Market Faces a Reality Check
The recent study conducted by dappGambl reveals the true state of the NFT market. With over 95% of NFT collections being effectively worthless, it is clear that the bubble has burst. The extravagant sales and hype surrounding NFTs have faded, leaving many people holding assets with no tangible value.
This reality check highlights the need for caution in the crypto world. While there may still be valuable NFTs out there, it is crucial to thoroughly research and assess their worth before investing. The once-booming NFT market has now cooled significantly, favoring buyers and leaving sellers in a desperate position. It remains to be seen how the NFT market will evolve in the future, but for now, it is clear that a reckoning has occurred.
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