NFTs are going through one of their weakest years since 2020 in trading and sales

The non-fungible token (NFT) market appears to have missed significant gains last year despite a broader rally in the digital asset industry.

In fact, the NFT market faced its weakest performance since 2020 in 2024.

NFTs face major setbacks in 2024

According to the latest from DappRadar edition From the ‘Dapp Industry Report’, despite an initial surge in trading volumes, which reached $5.3 billion in the first quarter, the NFT market struggled to maintain this momentum. By the third quarter, volumes had fallen sharply to $1.5 billion, although there was a partial recovery to $2.6 billion in the fourth quarter.

This volatility was accompanied by a decline in sales figures compared to 2023, suggesting that NFTs were sold at higher prices, likely due to rising values ​​of tokens like ETH. Overall, the year ended with a 19% reduction in trading volume and an 18% decline in sales.

“NFTs had one of their weakest years since 2020 in both trading volume and sales count. Perhaps 2024 helped us realize that NFTs don’t have to be expensive to prove their importance in the broader Web3 ecosystem.”

Interestingly, the gaming sector has become the dominant force in NFT sales, as indicated by the leading collections in terms of sales count. This trend highlighted the growing integration of NFTs into the gaming industry, where they facilitate true ownership of digital assets and promote player-driven economies.

Blur and OpenSea

Blur maintained its position as the leading NFT marketplace for most of 2024, except for the third quarter. In the fourth quarter, Blur and OpenSea were very evenly matched in market share. Blur’s rise was fueled by its strategic airdrop campaigns and a zero-rate trade policy that attracted cost-sensitive merchants.

OpenSea, however, had a challenging year. The U.S. Securities and Exchange Commission (SEC) issued a notice from Wells to OpenSea in August 2024, raising concerns about unregistered securities. This regulatory pressure, coupled with a declining market and intense competition, led OpenSea to announce major layoffs in November, reducing its workforce by 56%.

The company is now focusing on “OpenSea 2.0” to regain its competitive advantage, with hints of a possible token launch.

Meanwhile, Magic Eden surpassed OpenSea in performance. Initially a Solana-focused platform, Magic Eden has expanded to support Ethereum, Polygon, Bitcoin, and newer networks like Base and Arbitrum. On December 10, 2024, Magic Eden launched its ME token and conducted a $700 million airdrop to strengthen its ecosystem.