There has been a remarkable price increase in the NFT market recently. While certain collections, such as Bored Ape Yacht Club and Pudgy Penguins, stand out with significant increases in value in recent weeks, there is a noticeable decrease in the total number of buyers in the market and the overall transaction volume.
Prices are increasing rapidly while market volume is shrinking
Bored Ape Yacht Club and Pudgy Penguins collections stood out with the rapid increase in their base prices. While the base price of the Bored Ape Yacht Club series increased by 81 percent in the last 30 days, the base price of Pudgy Penguins exceeded the 5 ETH level and rose 20 percent on a weekly basis. During this period, approximately 201 sales occurred on Pudgy Penguins over a seven-day period, resulting in a total volume of almost 1,000 ETH.
These upward movements in prices create the impression of a revival that spreads throughout the NFT market. However, there is a significant decline in the number of new buyers and the market is more concentrated in a few large collections. According to experts, although the increase in base prices means that potential investors are willing to pay higher prices to enter, it is noteworthy that the general level of participation has decreased.
Trading volume and active users are decreasing
According to data from research company CryptoSlam, while global NFT sales volume was $304 million in February, it decreased to approximately $175 million in April. However, the total number of transactions and active users also halved. During the same period, there was a significant increase in the average sales price; The average transaction amount, which was $30.60 in March, increased to $67.38 in April.
Despite the increase in average prices, the number of active users and total transactions have fallen by almost half, indicating that purchases in the NFT market have largely shifted to limited collections and high-value transactions.
In the case of Pudgy Penguins, both the increase in price and the relatively high number of sales indicate that interest in the collection continues. On the other hand, although the transaction volume seems high in some collections such as CryptoPunks, it appears that this volume comes from a small number of large-scale sales and significantly affects the market price.
Imbalance continues in the market
There is still a significant imbalance in the overall market. According to CryptoSlam’s analysis, approximately 50 percent of the total trading volume in the market still comes from wash trading. In addition, despite the recent recovery, it is seen that the general profit-loss balance in the NFT market is negative and many investors are still losing money on their purchases.
It is considered that the rise in the overall crypto ecosystem also has an impact on NFT prices. In the last month, ETH gained approximately 18 percent and BTC gained similar rates. It is pointed out that this increase is one of the main factors driving up the prices of popular NFT collections. So, some of the rise in certain collections seems to be linked to increased risk appetite in the entire crypto market.
As a result, although we are going through a period in which prices in the NFT world are rapidly increasing, the decrease in purchases and the number of participants reveals that the rise is based on a limited segment and large value transactions.
