Major NFT Collections See Drop in ETH Price Lows, But There's a Problem

The minimum ethereum (eth) price of the five largest non-fungible token (nft) collections has plummeted in the last 30 days. according to the Price Floor nft data aggregator. The NFTs of the Bored Ape Yacht Club collection were the most affected, with a 26.6% decline in the price of eth.

Pudgy Penguins, which dominated volume traded within the top five collections, fell 10.3% in the same period. Meanwhile, CryptoPunks was the most successful collection in holding ground on eth, limiting the pullback to less than 7%. Autoglyphs and Chromie Squiggle, the remaining two of the five largest nft collections by market cap, fell 8% and 9.5%, respectively.

The losses in the eth-denominated price occurred at the same time that the traded volume of ethereum-based nft collections increased by more than 50% in traded volume, reaching $660 million.

Despite the drop in eth value, the dollar-denominated price of all five collections rose. Nicolás Lallement, co-founder of nft Price Floor, explains that this is a common market dynamic.

When it comes to nft prices, investors often debate the price of collections considered blue chips in eth and its correlation with the altcoin. “As some have suggested '1 eth ≠ 1 eth', meaning the investor's decision process is as follows: 1) Check the current eth price of the nft; 2) Check the current USD price of the nft; 3) Check the eth/USD price history of the nft; 4) Decide based on the current price of the nft in US dollars,” says Lallement.

In the last 30 days, eth has risen 62.6%, driven by bitcoin price growth and expectations regarding the approval of a spot eth exchange-traded fund (ETF) in the US. Lallement highlights that the Dencun upgrade, coming on March 13 and promising to reduce gas fees for ethereum layer 2 blockchains, is also playing a major role in the rise in the price of eth.

“That means that if eth goes up in dollar terms, NFTs will also go up in dollar terms, and eth-denominated prices will have to go down to reach equilibrium again. In my opinion, the nft bull in terms of eth will have to wait. We are still in a speculative phase where most of the attention is focused on low-value Solana-based NFTs and ordinals,” Lallement concludes.