Non-Fungible Tokens (NFTs) emerged as one of the hottest trends in the cryptocurrency and digital art space in 2021, with investors and collectors pouring millions into NFTs. However, a recent analysis by BitcoinCasinos.com shows that NFT interest has dropped by 76% YoY over time, indicating some cooling off in the market. The search volume dropped from a peak of 100 in April 2022 to just 24 in April 2023.
BitcoinCasinos financial expert Edith Reads commented on the findings saying, “The NFT market that was previously thriving is gradually becoming less active. The Google search interest in NFTs has fallen by three-fourths over the past year, suggesting that the past enthusiasm surrounding NFTs has decreased. This is likely caused by the combination of markets settling and investors being more cautious with their investments.”
NFT Market’s Struggles
The current NFT trend reflects investor interest shifting towards other cryptocurrency assets and sectors, such as decentralized finance (DeFi) and gaming. The decline in NFT interest over time can also be attributed to the high prices paid for digital art, which have led to questions about the value of NFTs and their sustainability.
Another factor driving the decline in NFT interest over time is the prevalence of scams and fraudulent NFTs, damaging the space’s reputation. This has led to a decline in the number of new investors entering the market, with many wary of the risks and unsure of the credibility of NFTs.
Furthermore, the regulatory landscape surrounding NFTs remains largely undefined, with many countries grappling with how to regulate the sector. This uncertainty may have contributed to the decline in investor interest in NFTs, with some investors preferring to invest in more established assets.
The declining trend in NFT interest over time may signal the market settling; however, it could also signal an opportunity for new players to enter the space. If the general outlook towards cryptocurrency remains positive, those previously interested in NFTs but waiting on the sidelines may regain enthusiasm and jump back into the market. This, in turn, may encourage others to follow suit.
Some upcoming developments at Yuga Labs and PROOF Collective align conveniently with this. Yuga Labs has already been generating significant hype, and excitement tends to be contagious in the world of NFTs. The new NFT trading platform Blur is also encouraging activity through its upcoming token rewards scheme, with traders eager to use the platform and get an airdrop.