Sales of Not Found Tokens (NFTs) worldwide are in decline, despite the good start to the year that they recorded a few months ago amid the bankruptcy of the FTX portal and the absence of regulation for these assets.
Until the end of April, the commercialization of these digital pieces fell for the second consecutive month, registering an approximate value of 702 million 762 thousand dollars, from the thousand 194 million dollars registered in February, according to data from the NFT platform and CryptoSlam cryptocurrencies.
In addition, May is shaping up to be the third month in a row of falls, since so far this period the value of sales amounts to just over 447 million 903 thousand dollars, according to the NFT platform.
“After rapid growth in 2021, the sale of NFTs has experienced a noticeable slowdown globally.
Several factors have contributed to this fall, including the decrease in demand and greater caution on the part of investors”, explained Elisa Madrigal, an independent financial analyst.
NFTs are digital assets that are noted for their ability to confer “authenticity” on a physical or digital item by claiming that it is unique.
This is achieved through the use of blockchain technology, commonly associated with cryptocurrencies, which prevents the falsification of information through a chain or block of data generated by a computer.
Therefore, when someone purchases an NFT-backed piece of art, song or video, they are guaranteed to be unique and irreplaceable.
THEY BECOME POPULAR IN PANDEMIC
The expert recalled that during the first months of the pandemic these assets became highly relevant, due to the popularity of cryptocurrencies and because they represented an “alternative” form of investment in the face of financial volatility.
However, as health restrictions were eased and daily life returned to normal, demand gradually dropped.
“Another reason for the drop in sales is market saturation. During its heyday, there was a flood of new works and digital artists looking to capitalize on this trend, causing an oversupply and falling interest from buyers,” Madrigal said.
The latter is reflected in the CryptoSlam data, since in January 2023 a total of 636,484 buyers and 607,952 sellers were registered, while in April there were 652,057 interested parties and only 582,845 merchants.
As of May 17, this figure is 448,875 buyers and only 472,971 sellers.
“Volatility and illiquidity in the NFT market have also contributed to its post-pandemic decline.
Although some have reached exorbitant prices, many others have quickly lost their value,” added Salvador Soto, an academic at the National Autonomous University of Mexico (UNAM).
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According to the CryptoSlam portal, today the most popular and sought-after Not Found Token (NFT) are images of frogs with glasses and caps, as well as skulls with musical backgrounds, as well as the collections of “CryptoPunks”, which they are characters with a punk style and that are created randomly by means of a computer algorithm.
In Mexico, some companies that have launched their NFT collections in recent years are Rappi, Consejo Mundial de Lucha Libre, and the music festival “Pa’l Norte”. Most of them could be purchased with various cryptocurrencies such as Bitcoin and Ethereum.
2023-05-20 08:00:00
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