NFT Market Sees Abrupt Decline, Losing $1.2 Billion in a Week
The non-fungible token (NFT) market has experienced a sudden and significant decline, with its value dropping by over $1.2 billion in just one week. This downturn comes after a brief recovery period, during which the market saw a 40% increase since mid-July. According to the latest data, the overall valuation of NFT collections has decreased to $8.1 billion, down from $9.3 billion on August 13.
The decline in the NFT market is closely tied to the performance of Ethereum (ETH), the blockchain on which many NFTs are based. As ETH prices have withdrawn by 9.63%, the NFT market has followed suit, with most of the top 10 collections experiencing a similar downward pressure. The total ratings of the NFT market fell to $8.1 billion, down from $9.3 billion just a week ago.
As reported by Satoshi Club, the NFT market lost $1.2 billion in less than a week, with ETH prices withdrawing by 9.63%. The current trading data indicates that ETH is trading at $4,275.52, down from $4,788 on Wednesday.
Cryptopunks Bleed $300 Million as Ethereum’s 9% Drop Triggers NFT Market Decline
Cryptopunks, the top-rated NFT collection, has seen its market capitalization decrease by around $300 million. The collection’s worth is now $2.1 billion, down 9.8% from its market capitalization of $2.4 billion just five days ago. At the end of July, large investors actively accumulated Cryptopunks, with a prominent whale buying 45 Cryptopunk NFTs for approximately 2,082 ETH (around $5.87 million) within a few hours.
However, the market mood has cooled significantly, with the Bored Ape Yacht Club (BAYC) falling to third place in the NFT market capitalization ranking. The value of the collection has dropped to $477.6 million, down almost 16% from its rating of $602 million on Wednesday. Conversely, Pudgy Penguins have risen to the second-highest rating, despite losing a total value of around $100 million.
According to Pudgy Penguins’ token (PENGU) data, established companies have begun to recognize blue-chip NFT collections as viable assets for financial diversification strategies. Last week, the publicly traded blockchain company BTCS Inc. announced the acquisition of three Pudgy Penguins NFTs for its corporate digital assets.
“Digital Trash”: Solana Co-Founder Slams NFTs as Worthless Hype
Solana co-founder Anatoly Yakovenko has characterized NFTs and meme coins as “digital garbage,” essentially lacking assets with real value. Sunil Raina, CEO of Cerebree, recently told Cryptonews that the majority of NFTs remain without usefulness, created without intrinsic value, legal rights, or permanent utility. These assets are speculation-driven results.
Raina continued to describe NFTs as predominantly “digital receipts,” the valuations of which are primarily driven by hype cycles, influencer funding, and viral trends rather than technological fundamentals. Nevertheless, Maria Carola, CEO of Stealthex, recognizes that Yakovenko’s “digital garbage” criticism can apply to superficial, hype-oriented releases. However, she argues that there is a real NFT demand and confirms its market presence, even if they only act as digital collectors in a limited edition.
NFT pulse data shows that active NFT users in blockchains have almost doubled since the beginning of 2024, rising from 126,390 in March to over 641,000 in June, although they have since dropped back to around 328,600 in August. While Solana initially dominated the activity, Base now accounts for more than 50% of the total transaction volume.
For more information on the NFT market and its recent decline, visit https://cryptonews.com/news/short-lived-nft-market-recovery-ends-with-1-2-billion-weekly-decline/
