NFT Market Growing Steadily Despite Bearish Crypto market

The NFT market is gradually gaining momentum after a bad run in Q4 of 2021 and Q1 of 2022

Market Ethereum NFT

A recent report by Chainalysis shows that activities around NFTs and NFT market dropped early this year. But Since April the downturn has gradually reversed and activities have picked up steam. The document also noted that growing interest derived from retail investors – as shown within the rising number of small-sized transfers – has not yet overridden the market share dominated by institutional investors.

NFT Market gradually gaining stability in 2022

Following the impressive growth experienced in 2021, which ended in November. The NFT market took a turn for the worse from January to March. And this in the same direction as the broader crypto market that has not fared better.

As demonstrated in transaction volume, trading activities have since picked up within the mid of April. And until May 1st, collectors had sent over $37 billion to NFT marketplaces as of 2022. Chainalysis reports that this figure is only $3 billion short of the volume documented for 2021,

The Chainalysis report highlighted that total transaction volume hit a low point on the week of March 13th. But activities quickly sprung back to life shortly after Bored Ape Yacht club launched its metaverse project. The immense capital the project attracted from institutional investors is largely the reason for this rejuvenation.

“Despite these fluctuations in transaction volume, the quantity of active NFT buyers and sellers continues to grow.”

The NFT growth trend is additionally reflected within the increasing number of active addresses. 950,000 unique wallets have bought or sold an NFT in Q1, up from 627,000 in Q4 last year, the report noted. Also, new NFT addresses reached 491,000 within the primary month of Q2, indicating that the amount of participants has continued its quarterly growth trend.

Whales Invested heavily on top NFT projects

The document stated that the overwhelming majority of transactions are below $10,000 worth of digital assets. Meanwhile, the quantity of whale-sized transactions between 10K and 100K has stalled within the half-moon. In terms of total transaction value, however, institutional transfers have made up the bulk of trading activities.

In particular, whenever notable NFT projects came on the scene, the quantity of institutional transfers would spike. The report gave an example as such:

“During the week of October 31, 2021, institutional transfers made up 73% of all activity, largely thanks to the acquisition of several NFTs within the Mutant Ape boat club collection.”

Another key takeaway from the report is that NFTs have continued to capture global audiences, with no region making up quite 40% of the traffic volume. Central & Southern Asia – slightly sooner than North America and Europe – has accounted for roughly 20% of the volume as of 2022.


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