NFT Market Trends: Understanding the Current State of the Industry
The global non-fungible token (NFT) sector has experienced a significant decline, with its total market capitalization falling below $1.5 billion. This downturn has brought the market back to levels last seen before the sector’s rapid expansion in 2021. According to data from CoinGecko, the decline over the past two weeks has occurred alongside a broader crypto market downturn, with the total crypto market cap dropping from $3.1 trillion to $2.2 trillion.
Major assets such as Bitcoin (BTC) and Ether (ETH) have also seen significant declines, with Bitcoin falling from around $89,000 to $65,000 and Ether falling from $3,000 to almost $1,800 over the same period. As reported by CryptoSlam, Bitcoin and Ethereum are the top two networks for NFTs in terms of 30-day trading volume, highlighting the interconnectedness of the crypto and NFT markets.
The decline in NFT market cap follows several high-profile closures and exits, which have contributed to the sector’s ongoing decline. The market has been further exacerbated by a growing imbalance between NFT supply and buyer demand. As Cointelegraph previously reported, total NFT supply continued to rise despite declining sales and prices, pushing the sector into a high-volume, low-price structure.
Rising Supply and Falling Demand: Understanding the Imbalance
The NFT market has seen a significant increase in supply, with the number of NFTs in circulation rising to nearly 1.3 billion in 2025, a 25% increase compared to 2024. However, total NFT sales fell 37% year-over-year to $5.6 billion, while average selling prices fell below $100. This divergence suggests that while the barriers to NFT issuance have decreased, buyer participation and spending have not kept up.
The decline in demand has been further accelerated by the lack of scalability and sustainability in the NFT market. Several high-profile companies have exited the market, including Nike, which quietly sold RTFKT, the digital collectibles studio it acquired at the height of the NFT boom. Additionally, marketplace closures have accelerated, with Nifty Gateway announcing that it will be shutting down on February 23 and moving to withdrawal-only mode.
Company Departures and Platform Closures: Increasing Pressure on the NFT Market
The decline in the NFT market has been further exacerbated by company departures and platform closures. On January 28, NFT social platform Rodeo announced that it would be ceasing operations after failing to scale sustainably. Rodeo said it would move to read-only mode before shutting down completely in March. These closures and exits have increased the pressure on the NFT market, highlighting the need for scalability and sustainability in the sector.
To learn more about the current state of the NFT market and its trends, visit Cointelegraph for the latest news and updates.
