How Are NFTs Holding Up?
Today has been a very volatile day in the crypto markets, to say the least. Binance is set to potentially acquire FTX in a blockbuster move, and early fallout from the news has sent several crypto tokens down sharply.
So what is the early impact on the NFT market?
Market Volume Impact
For starters, volume is down. Yesterday OpenSea hit $12M in trading volume, but so far today has just $5.45M (on pace for ~$7M). This is partially caused by the dipping ETH price (-18.7% to $1,300), as well as crypto trading clogging up the Ethereum blockchain and driving up gas prices.
omg bull market must be back on pic.twitter.com/sU5hlAar6T— Grant Riven Yun (@GrantYun2) November 8, 2022
But in general, NFT liquidity typically dries up on very volatile macro crypto days.
That lack of liquidity has started to impact some NFT project sectors.
The top-end PFP market is holding steady, so far.
BAYC is at 66.8 ETH on Blur (removing flagged assets) and 69.5 ETH on OpenSea (+0.74%). CryptoPunks are at 64.69 ETH, even on the day, but leading the volume charts with 546 ETH traded (flight to quality).
Mid-tier PFPs are down slightly, with CloneX at 8.6 ETH (-2.6%), MAYC at 12.35 ETH (-0.56%), and Azuki at 11.07 ETH (-1.2%), though the 3 sets have combined for just 156 ETH volume.
Though, while these projects' floors are mostly steady in ETH terms, they are now down ~20 percent in USD with the recent ETH dip.
Recent Movers Impact
The volatility seems to have hurt recent project movers the most.
Friendship Bracelets opened the day at 0.3 ETH floor but have since dropped 30 percent to 0.2 ETH. KPR has fallen 16 percent to 0.64 ETH, and RENGA has given back some recent gains, falling 12 percent to 1.05 ETH. Art Gobblers also continue their recent downtrend, falling another 6 percent to 3.8 ETH as GOO hits $11.7 (-14%).
Other (Surprising) Impacts
Perhaps the biggest and most important NFT takeaway from this crypto volatility is out of Frank DeGods and the Solana ecosystem. For those not following, SOL has been one of the hardest-hit tokens (besides FTT), down 26 percent on the day to $23.79.
This has led Frank to reconsider his future on Solana.
I would love to continue to build on Solana. I love Solana. But I’m a servant to my communities & holders.— Frank (@frankdegods) November 8, 2022
Nobody is making any rash decisions… this is just what direct communication looks like in times of crisis.
Will open a dialogue with our holders and see where it goes.
To be clear, he indicates no "rash decisions" will be made and promises to engage the community in the decision-making process.
The y00ts floor has taken a beating on the day, down 20 percent to 58 SOL ($1,379 or 1.05 ETH). The mint t00bs are down ~10 percent at 82.5 SOL.
UPDATE: as of 3:51 p.m. ET Frank shared that he deleted his tweets about moving to ETH, due to their impact. He did mention that dialogue will remain open but "No decisions will be made today."
This situation is all still evolving and the full extent of the impacts likely will not be known for days (perhaps weeks). Additionally, NFT market action does typically lag crypto actions, so there may be greater moves over the next few days.
One thing is fairly likely though - we will not see a big NFT rally until the crypto markets re-stabilize.