NFT Weekly Preview | The Merge Aftermath

Now what?

That's the leading question in the crypto and NFT markets right now, with the major Merge event now behind us. The incredible technical feat went off without a hitch last Thursday in the very early hours of the AM, watched live by at least 30k+ people who joined Twitter Spaces to celebrate and ring in the new Ethereum era as proof-of-stake.

But then the reality of this bear market set in, as ETH fell nearly 25 percent over the last few days to $1,330. With The Merge narrative now behind us, there are no more remaining narratives on the horizon and likely more pain to come. Attention (and funds) have been diverted to other coins as well in this time, as BTC dropped just 12 percent on the week to $19,150, and the BTC:ETH ratio is now back up to 14.3:1 (from local lows near 11.7:1). Solana has also outperformed ETH on the week, down just 8.9% at $31.91.

Now the next major event to watch in the markets will be the FOMC meeting here this week, with the Fed expected to hike rates at least 75 bps, and the markets are pricing in 30-40 percent chance at 100 bps hike. There is some growing sentiment that 100 bps could be the best outcome, leading to a quick nuke and then perhaps a bottom. Of course, it is impossible to predict, but one thing is certain - it will be a volatile week.

For the NFT market, it's a different story. Even though overall volume continues to slide down (30D volume is down 11% month-over-month), project floors had a great week. Of the top 30 NFT projects by floor price, 21 were in the green or neutral on the week in what has been the strongest weekly performance in some time. Those gains were realized most in the mid-tier sets, across generative art, PFPs, and the P2E sector.

Let's take a closer look at the week.

NFT Market Weekly Analysis

Renga was likely the top story of the week, catching fire on the back of a few whales doing several Twitter threads of them opening up the Renga Black Boxes and sharing their favorite outputs. That attention helped drive the Black Box floor all the way to 3 ETH+ at the peak before settling at 2.2 ETH, up 194 percent on the week. Revealed Rengas are at 1.2 ETH floor, up over 100 percent after seeing 4.5K ETH volume on the week. There have now been 7 double-digit ETH sales on rares, which has also helped drag the floor up in what has quickly become the hottest new PFP project.

The Yuga ecosystem was next up, taking four of the top five spots on the weekly board and combining for ~8,300 ETH across Punks, BAYC, MAYC, and Otherdeeds. While Punks and Apes mostly chopped on the week (63.5 ETH and 73 ETH floors respectively), MAYC jumped 13 percent to 13.8 ETH and Otherdeeds was up 4 percent to 1.73 ETH.

That 13 percent jump for MAYC lagged the mid-tier PFP market significantly though, as Doodles popped 24 percent on the week to 8.8 ETH and Azukis were up a whopping 43 percent to 9.9 ETH. The Azuki move seems to be on speculation of their upcoming airdrop/announcement that has been teased since NFT NYC, anticipated to drop this week. Doodles surged briefly on the news that they raised $54M at a $704M valuation, and did a full roundtrip from 7.5 ETH to 9.2 ETH back to 7.1 ETH before running nicely over the weekend. 

Moonbirds and CloneX also benefitted from the mid-tier PFP action, with the birds up 9% to 10.9 ETH on the week and CloneX up 6% to 5.95 ETH (though it continues to lag the most in the mid-tier bundle).

DigiDaigaku had a great week in the P2E sector, jumping 73 percent to a 13.4 ETH floor. In the first expansion set, the Digi Spirits were up 125% on the week to 6.1 ETH floor, making the total for the pair 19.5 ETH, 20 percent higher than recent local highs. The surge seems to be on the back of Gabe Leydon and the Limit Break team opening up a project discord along with a few whale sweeps, and the set seems to have some real momentum right now.

In the art world, there were several winners as well on the week, with Gazers up 20 percent to 12 ETH floor, Archetype +9 percent to 24 ETH, and Genesis up 40 percent to 8.8 ETH.

A few notable losers on the week included Wolf Game Land, down 30 percent to 0.34 ETH, Tykes down 18 percent to 2 ETH, and the Pudgy Penguins down 9 percent to 3.4 ETH.

Overall this green on the board was very welcome and much needed but is not cause for celebration just yet. This week will be telling, as new projects start dropping again after last week's snooze fest and we see if volume can pick up. It is still a lighter week of new drops, but there will be more to choose from than last week.

The top focus for new drops this week include:

• Art Blocks Curated "Act of Emotion"
• Free Mints

Art Blocks Curated "Act of Emotion"

This week's Curated drop will mark the first of the Proof of Stake era and thus may see an extra bump in attention from collectors. This set of 400 NFT supply from generative artist Kelly Milligan is titled "Act of Emotion" and it "investigates digitally-facilitated abstract expressionism: the act of painting itself as a means of expression, extended into mechanical reach."

The outputs are animated and Kelly is trying to achieve a human-heart-like beating pattern with the ongoing brush strokes in the images. The results are abstract and minimalist while achieving a very nice degree of aesthetics, and as the artist is using a variety of color palettes, there will likely be at least some degree of rarity in play.

With the lower supply, aesthetics and first PoS Curated set combo, this drop has a nice set up to do well. The min price of the dutch auction is 0.25 ETH, and if this one goes anywhere near min price it should be a very successful trade. Most likely this one will mint out in the 0.75-1 ETH range, making it a bit riskier, so always be mindful of the entry price. But this should be a fun one to watch on Wednesday.

Free Mints

There are several free mints on the calendar for this week, showing that some founders are ready to enter this market even with the low volume. The current list includes:

• Legend X - 3K supply, 9.5K on Twitter (Monday at 5 p.m. ET)
• Atsui - 5,555 supply, 44K on Twitter (Monday at 9 p.m. ET)
• W3 Art - 2.5K supply, 6K on Twitter (Tuesday at 11 a.m. ET)
• Astro Armadillos - 1K supply, 4.9K on Twitter (Wednesday at 2 p.m. ET)
• Subjects - 7,777K supply, 49K on Twitter (Wednesday at 5 p.m. ET)
• Porkers - 10K supply, 4K on Twitter (Thursday at 8 a.m. ET)
• Akuma Little Devils - 6,666 supply, 71K on Twitter (Thursday at 8 p.m. ET)

Of these, W3 Art looks perhaps the most interesting as it is an art and access pass project, with 2,500 spaces and multiverse-themed outputs that will also provide access to future drops from artist Julien Risso. Free art and access to future drops - what's not to like? Other than W3, Subjects and Akuma have by far the biggest followings, though that is not a guarantee of success. But with an entry price of zero, the risk/reward on all of these looks great.

Conclusion

Overall it remains a slower week of new releases, though definitely an uptick over last week. The main story to watch and probably X factor of the week will be the Azuki project, now back to its 10 ETH floor and with a major announcement of some kind expected for this week.

The other trend to watch will be falling ETH and its impact on the NFT market. If we see a big dip post-FOMC, it could very well halt the markets for a bit. But then we have a real shot of some re-pricing in USD terms as we saw after the last crash. And given a lack of expectations for more big news in the near future from the top teams, re-pricing in USD may very well be our best bet for a move up,

With several free mints on the board, a quick reminder to use security precautions when minting. Make sure to stay safe out there, and stay up to date with all the breaking market news with the Lucky Trader app and newsfeed. Have a great week!