96% of NFT collections are considered 'dead'

nft Evening analysts say 96% of 5,000 nft collections will be dead by 2024.

He nfts-dead-2024/” target=”_blank”>report The study reveals the state of the non-fungible token market and its problems in 2024. According to experts, 96% of the more than 5,000 existing nft collections are “dead.” This means that they have zero trading volume, have not made any sales for more than seven days, and have no activity on social network x.

Analysts note that 4 out of 10 nft owners currently need to make a profit on their tokens. At the same time, the average lifespan of collections is 1.14 years. This is 2.5 times less than the same indicator for classic crypto projects.

Moreover, 2023 was a record year in terms of the number of nft bankruptcies. During this period, almost 30% of projects in this segment fell into the “dead” category. According to experts, 44.5% of nft owners are facing losses.

The nft Evening team also identified the most profitable collection to date. It turned out to be the Azuki project, which, on average, increased token holders' investments by 2.3 times.

“This success can be attributed to the collection’s strong community engagement, unique artistic appeal, and effective marketing strategies.”

Experts also mentioned the least profitable nft collection: Pudgy Penguins, whose value fell by 97%, making it the current record holder for the decline in income for its owners.

Experts stressed that the non-fungible token market has declined and that investors in the segment should act with caution. In addition, experts believe that nft creators should reconsider their approach to project implementation.

End of an era

nfts from popular collections bought in the wave of enthusiasm in 2022 are selling at colossal losses.

For example, Arkham Intelligence calculated that nfts purchased by pop star Justin Bieber in 2022 for around $2 million are now worth just over $100,000. Losses reached 94.7%.

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The singer's wallet initially received $2.34 million worth of ethereum (eth). The bulk of the amount, $1.86 million, went towards the purchase of two Bored Ape Yacht Club (BAYC) tokens and a pair of Mutant Ape Yacht Club (MAYC). The wallet also included tokens from the World of Women, Doodles, Otherdeed, and Metacard collections. The assets have since lost between 89.7% and 97.4% of their value.

Also in August, Deepak Thapliyal, the owner of the most expensive CryptoPunk, #5822, who bought the token for 8,000 eth ($23.7 million at the time of the transaction) in 2022, offloaded the asset without disclosing the sale price. Amid the excitement in the sector, the transaction became the fourth most expensive among all nfts in 2022.

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The community suspects that the token was sold at a loss. The buyer was allegedly user x, who goes by the nickname VOMBATUS. The token was purchased for 1,500 eth (about $3.9 million), which is 80% cheaper than the previous price.

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The rise and fall of OpenSea

In January 2022, the total volume of non-fungible tokens peaked at over $6 billion. By July 2024, it had fallen below $430 million. nfts are still alive, but they are in a bad place.

Once the largest nft marketplace, OpenSea is in even worse shape, The Verge notes, due to complaints from the Securities and Exchange Commission and the Federal Trade Commission, U.S. and international tax authorities, increased competition, accusations of discrimination, and employee layoffs.

Additionally, OpenSea's valuation fell from $13.3 billion to $1.4 billion after one of its largest investors, New York venture capital firm Coatue Management, overvalued its stake in the cryptocurrency startup by 90%, from $120 million to $13 million.

However, crypto–nfts-workplace-rise-fall” target=”_blank”>The edge The company still has some steam left in it. An internal document shows that as of November 2023, OpenSea had $438 million and $45 million in cryptocurrency reserves. It hopes that with this capital and a new business model, it can weather the tough times.

“It had $438 million in cash and $45 million in cryptocurrency reserves as of November 2023, according to an internal document, and is tapping into that capital as it hopes a pivot to version 2.0 will help it navigate choppy seas.”

<h2 class="wp-block-heading" id="what-will-happen-to-the-nft-market”>What will happen to the nft market?

The nft market has long been limited to marketplaces like OpenSea or Rarible, where users can issue new nfts or trade them with others.

There are lending services or platforms for trading derivatives on nfts from large collections, allowing users to speculate on nfts without owning them.

However, the bearish dynamic in the non-fungible token market persists, as evidenced by the rapid decline in prices of nfts from top-tier collections.