NFT Evening Analysts Reveal 96% of 5,000 NFT Collections Are Dead in 2024

End of an Era

The non-fungible token (NFT) market has faced significant challenges in 2024. According to a recent report, 96% of over 5,000 existing NFT collections are considered “dead.” This categorization means these collections have zero trading volume, no sales for more than seven days, and no activity on social media platforms.

Experts highlight that 4 out of 10 NFT owners currently need to make a profit from their tokens. The average lifespan of NFT collections is 1.14 years, which is 2.5 times shorter than the lifespan of traditional cryptocurrency projects. Additionally, 2023 saw a record number of NFT collapses, with almost 30% of projects falling into the “dead” category. According to analysts, 44.5% of NFT owners are facing losses.

The Rise and Fall of OpenSea

In January 2022, the total volume of non-fungible tokens peaked at over $6 billion. By July 2024, this volume had fallen below $430 million. OpenSea, once the largest NFT marketplace, has experienced a significant decline. The platform has faced claims from regulatory authorities, increased competition, allegations of discrimination, and employee layoffs.

OpenSea’s valuation dropped from $13.3 billion to $1.4 billion after a major investor, New York venture capital firm Coatue Management, devalued its stake in the company by 90%. Despite these challenges, OpenSea still has substantial reserves, with $438 million in cash and $45 million in crypto reserves as of November 2023. The company is banking on a new business model to navigate these turbulent times.

“It had $438 million in cash and $45 million in crypto reserves as of November 2023, according to an internal document, and it’s coasting on that capital as it hopes a ‘2.0’ pivot will help it navigate choppy seas.”

What Will Happen to the NFT Market?

The NFT market has traditionally been limited to marketplaces like OpenSea or Rarible, where users can issue new NFTs or trade them with others. Recently, new platforms have emerged, offering lending services or trading derivatives on NFTs from large collections, allowing users to speculate on NFTs without owning them.

Despite these innovations, the bearish trend in the non-fungible token market continues. The rapid decline in prices of NFTs from blue-chip collections is a testament to this ongoing downturn.

Investors and creators in the NFT space must act cautiously. Experts suggest that NFT creators should reconsider their approach to project implementation to navigate these challenging times successfully.

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