NFT sector sees monumental growth

28 May 2021

The popularity of NFTs (non-fungible tokens) continues to rise, despite over $1 trillion being wiped off the cryptocurrency market cap earlier this month.

A report by DappRadar out on Friday reveals the average number of NFT sales increased almost 300% from 21,815 per day in January to 82,373 in May to date.

This figure reached even higher as cryptocurrency prices began to decline on 12 May, Cointelegraph reports, with sales skyrocketing to near 94,000 daily NFT transactions. 

NFTs are one-off digital assets that are verified through blockchain technology, giving buyers certificates of authenticity and ownership. They produce unique, non-interchangeable digital tokens, and can be bought and sold like any other assets but they do not have a physical form.

Despite the crypto market crash resulting in “serious congestion and exorbitant transaction fees across the Ethereum network”, says Cointelegraph, the increasing fees didn’t discourage NFT traders.

Although the number of trades has risen, the value of each trade was impacted as crypto prices fell.

The first 11 days of the month registered an average of $14.9 million traded daily, yet this has declined to less than $6 million a day since.

However, according to deVere CEO and founder Nigel Green, the virtual hype about NFTs is very real.

Mr Green said earlier this month: “A growing number of globally established brands are becoming increasingly involved in the NFT market including the National Basketball Association (NBA) and Sotheby’s. 

“The latter, the traditional auction house, held a three-day auction of NFTs by an anonymous artist two weeks ago. Meanwhile, Christie’s last month sold “Everydays – The First 5000 Days,” a digital artwork in JPEG form by an artist known as Beeple, for $69.3 million – which is the third most expensive artwork ever sold by a living artist.”

He added: “Although NFTs are the hottest new digital asset, it’s essential that investors remain cautious.

“Having said that, those who completely snub NFTs would likely be those who previously dismissed digital currencies like Bitcoin or online retailers such as Amazon.”