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There’s a major slowdown in the NFT market. The monthly trading volumes have dropped by 56% to $500 million.
Monday’s extraordinary sell-off in the crypto market has been one of the darkest days in the history of the crypto bear markets. While the broader crypto market plummets, the ripple effect spreads across the NFT prices too.
During Monday’s market sell-off, the floor prices of some of the top NFT projects like Bored Ape Yacht Club (BAYC) and CryptoPunks, tanked significantly. The floor price of BAYC NFTs tanked to 74 ETH ($92,223) registering a 25% drop in a single day. Similarly, the floor price of CryptoPunks NFTs dropped to 48 ETH ($69,473). As per the Bloomberg report:
“The NFT Index, which tracks the performance of nonfungible tokens and is weighted based on each token’s circulating supply, fell about 23% in the past 24 hours. The NFT market had been a bright spot relative to the rest of assets in the crypto space during the market rout. Investors have built substantial portfolios of NFTs in the past six months despite their low liquidity compared to fungible tokes like Bitcoin and Ether”.
Just for comparison, the BAYC NFTs once pegged an all-time high price of 153 ETH while the CryptoPunks NFTs’ all-time high was 123 ETH.
Did Possibility of Hack Fueled Bored Ape NFT Selling?
A day before, Yuga Labs’ co-founder warned Bored Ape NFT owners and asked them to remain cautious owing to the possibility of their Twitter account getting hacked. The Yuga Labs co-founder also alleged that a Twitter insider could be behind this hack.
This could also be a possible reason behind fueling the sell-off in NFTs. As the NFT market has been growing, hackers have been active for a while. Earlier this month, hackers managed to steal 150 ETH from the Bored Ape Discord Group.
Also,Yuga Labs made an important change to its code of Bored Ape by deleting part of the code that would allow hackers to mint unlimited NFTs. If at all the hackers would have exploited it, there would have been surplus NFTs in the market leading to a severe crash in BAYC NFT prices.
The NFT market is also seeing the effects of a slowdown. As per DappRadar, the number of users on the largest marketplace OpenSea dropped by 14% over the last month. At the same time, the monthly trading volumes have also dropped 56% to $500 million.