How has the flow of funds in the NFT market changed compared to 2021?
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How has the flow of funds in the NFT market changed compared to 2021?
Market liquidity remains insufficient, and we should approach this market with greater caution than in 2021.
Navigating Web3 tides with focused insightsWritten by: Martin
Translated by: TechFlow intern
NFTs have become one of the hottest topics in the cryptocurrency space recently. Even amid unfavorable market conditions, the NFT sector has managed to maintain its own independent momentum. This article primarily compares NFTs with last year, analyzing how capital flows have changed. Let’s dive in.
First, trading volume: despite current capital constraints, trading volume remains higher than almost any week in 2021. 2021 was arguably the "Year One" of NFTs, and many believed last year would mark the peak of the NFT boom. However, judging by current trading volumes, 2021 now appears to have been just the beginning.
Weekly user counts and transaction volumes follow a similar trend—although current activity may not appear particularly strong, both metrics still exceed those of any single week last year. No one would believe this is a market on the verge of collapse.
The number of weekly active projects is also on an exciting upward trajectory, growing from 1.8k at the beginning of the year to over 2.4k now.
The NFT-500 index has also shown solid recovery since March. Social-oriented projects like BAYC and Azuki are thriving and maintaining their leading positions. Unfortunately, according to the index, metaverse-related NFTs have shown no signs of rebound whatsoever.
In summary, there's no doubt that the NFT market is strengthening. New projects often attract massive attention and see strong price performance. Perhaps "chasing new launches instead of holding old ones" is one of the best strategies for the current environment. Focus should be placed on new projects backed by strong teams, clear roadmaps, and solid execution. However, only blue-chip collectible NFTs are showing strong trends, while metaverse NFTs remain in a deep winter. This serves as a reminder that market liquidity is still limited, and we should approach this market with greater caution than we did in 2021.
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