The NFT ecosystem continues to expand at an unprecedented rate in 2021. According to a NonFungible.com research based on NFTs industry figures, the market for non-fungible tokens topped $250 million in early 2020, an increase of about 300 per cent from the previous year.
Furthermore, within a few months, crypto investors invested $90 million into the NFT ecosystem and digital collectables, increasing the absolute market value of digital marketplaces by 1785 per cent, from $23 million at the start of 2021 to $432 million towards the end of March.
Virtual worlds and artworks accounted for the majority of NFTs segments. Nonetheless, computer games led in terms of transaction volume (almost half of all NFT ecosystem transactions in 2020 were related to them), and collectables were not far behind.
The most popular NFT-marketplace is a worldwide OpenSea platform that allows users to mint and trade NFTs, including the ERC721 and ERC1155 standards, as well as access data and check statistics on them. It was founded in 2017 and now provides over 300 different types of assets as well as over 10,000,000 issued tokens.
Users may access almost all crypto collections, including CryptoPunks and Hashmasks, as well as goods from several famous blockchain games, like SoRare, CryptoKitties, Axie Infinity, Gods Unchained, and many others. OpenSea’s revenues will reach a new high of roughly $150 million in June 2021.
Mintbase is another popular marketplace for buying, selling, and making NFTs, and it specialises in covering speciality NFT categories, including music, photography, and news.
Evolution Of Active Wallets
We looked at whether active wallets have executed at least one NFT transaction across different time periods to evaluate the development of active wallets through time:
- Before: September to December 2020
- Pre-Boom: January to February 2021
- Boom: March to April 2021
- Post-Boom: May to the first week of June 2021
NFT Ecosystem Before The Boom
While 27,236 addresses were active from September to December 2020, 16,373 (-39.8 per cent) were not active before this emerged for January / February 2021.
NFT Ecosystem During The Boom
During the Boom, almost 60,000 new wallets interacted with NFTs. This is a lot about the scale of the NFT ecosystem, but it’s a lot when you consider all of the hype that’s transpired throughout the world.
It is worth noting that the 60,417 wallets that came at the peak of media interest have not (for the time being) been followed up on or engaged with the NFT ecosystem.
NFT Ecosystem After The Boom
Whereas some believe that the “Boom” has ended and the market has crashed, we can see that over 45,000 new wallets engaged for the first time with NFTs during the May/June timeframe. This score is significantly greater than that of the Pre-Boom period.
So far, these data suggest that there has been significant growth in the number of new addresses active in the NFT ecosystem. This is due in part to Beeple’s record sales and global media attention of the NFT ecosystem, which has brought a flood of new users into the ecosystem.
June, in particular, was a milestone month for the NFT industry. OpenSea, a key NFT marketplace, reported about $150 million in NFT sales alone. This statistic is even more impressive when you consider that the whole NFT market made just 9% of this amount over a 6-month period. In other words, OpenSea made 1,000% more revenue in June than the whole NFT sector combined.
Despite concerns that the NFT bubble has burst, the market is not slowing down as we approach the second half of 2021 and beyond. According to the most recent data, demand is actually increasing.
Distribution of NFT Sales
Another relevant metric is the distribution of NFTs sales. In actual words, the question is, how has the Boom affected pricing patterns.
We have set pricing ranges ranging from $0.1 to $10, with a maximum range of $500,000 to $1,000,000.
One aspect of this graph is particularly essential to remember: by the end of 2020, 99 per cent of NFTs sold were for less than $5,000. Since the beginning of 2021, assets selling for more than $5,000 have steadily taken their place at the cost of NFTs selling for less than $10.
This might have been explained by unusually high transaction costs (buyers not desiring NFTs worth less than the transaction fee), except that the gas price has decreased substantially in recent weeks. Still, the fraction of the cheapest NFTs has not increased.
The NFT market environment did not alter substantially between September 2020 and June 2021. Still, it does exhibit a very strong inflexion that allows for more costly assets ($> $5,000), which account for about 10% of the market.
Simultaneously, the middle segment (between $100 and $5,000) has risen significantly. The biggest loser in this new environment is the sector of the cheapest assets (less than $100), which once accounted for up to 85 per cent of the whole market but now accounts for just 50 per cent of sales.
Wrapping It Up
We are still just halfway through the year, but what has piqued our interest in this research is the number of wallets that have stayed active after the initial excitement we experienced for a few weeks.
The USD indicator is always interesting to watch, but looking at the number of active wallets, mainly new wallets, provides far more specific signals of the condition of the NFT market.
Despite a challenging background for all of these newbies to grasp, the sector is nothing like it was in past years and has grown considerably more accessible owing to the efforts of the whole ecosystem!
These efforts appear to be recognised today by an increasing number of NFT users, and the least we can do is welcome them on this journey, which, in our opinion, is still in its early stages.
The following are a few conclusions to be taken from these Post-Boom analyses:
- The NFT ecosystem has a very high percentage of new user retention (25 per cent)
- Following the boom and hype, the ecosystem has seen roughly 40,000 new users join every two months.
- The market’s average asset price has risen substantially, creating a section of “extremely costly” assets available primarily to the wealthy.
There is, without a doubt, a before and after the Boom. The ecosystem is expanding rapidly, attracting an increasing number of new users who have already begun to create this new age of the NFT environment.