Interpretation of the reasons behind the cold NFT market and changes in blue-chip NFT

Looking back, after the first year of Terra's plunge, the overall trading volume of the NFT market, the new issuance of NFT, and the price of the top blue-chip NFT Project all showed a downward trend, and the niche NFT in the end market even fell to zero.

Analyze the causes of this freezing point from the shallower to the deeper:

1. Liquidity extraction in the NFT market;

2. NFT players lack confidence in the market outlook, so they clear their positions and leave the market;

**3. The blue-chip NFT in the NFT lending agreement is FUD caused by the sale of giant whales and the dumping of Blur farmers. **

Judging from the data, Terra rekt time is not the lowest point of most NFT prices in the market. The low point of most NFT prices is hovering in April of 2023, and there is a continuous downward trend in terms of trading volume.

Yuga Labs

From the perspective of the leader in the track, although Yuga Labs has launched Dookey Dash, Bitcoin NFT series TwelveFold, and otherdeed second test, there is no new narrative gameplay to attract more players' attention and liquidity. The expansion rate of the ecology far exceeds the benefits that can be realized.

In addition, the NFT series of Yuga labs ecology has also been further expanded and failed to perform well in price. The price of koda before it was separated was about 14E, and the price of land before the element split The floor price is 2E. Now the floor prices of these two series are both cut in half.

LimitBreak

Not only Yuga Labs, but LimitBreak is also facing such a problem. The diversification of NFT assets in its ecosystem distracts players' attention and liquidity, which leads to a decline in the price of NFT series, further disintegrating the confidence of HODL in the bear market.

BAYC

In addition, following the FTX incident, major NFT investors represented by Franklin have successively sold their monkeys and other blue-chip NFTs. Indirectly led to the further spread of anxiety and panic among other NFT holders, and the confidence in the NFT market dropped to freezing point.

Backtest the BAYC trading volume over the past year. In February of this year (02.24), we monitored a sharp increase in the transaction volume of BAYC. According to parsec data, many large investors fled.

One potential reason is that Blur's bid mining reward mechanism has provided a lot of liquidity to the market and accelerated the process of bursting the bubble in the NFT market. (Related Links)

Blue chips with the strongest rebound

Among the 32 "old blue chips", only 13 project prices have risen, and most "blue chips" have fallen by 40%-90%, and the income brought by holding blue chip projects is far from the expected rate of return of Alpha. Most of the derivatives of NFTs with good gains also have higher gains, such as Milady and Redacted Remilio Babies, Azuki and BEANZ, Pudgypenguin and Lil penguins.

Among the top 15 NFTs by trading volume, only holders of CryptoPunks, Milady Maker, Azuki, and Pudgy Penguins have had positive returns in the past year. (Azuki had a community trust crisis in May last year, and various scandals were exposed. Community holders sold NFT at the lowest price at that time.) NFTs with real investment value are: Milday Maker, Pudgy Penguins, and CryptoPunks.

Among the 27 projects launched within a year, 15 projects showed an increase in price, and 12 projects showed a downward trend. Among them, OpenEdition, RedactedRemilioBabies, and Nakamigos had an increase of more than 10 times. On the whole, newly launched projects with high transaction volume and high income have seen a smaller decline than old NFT projects.