While the first half of 2021 proved to be a volatile time for cryptocurrencies, non-fungible tokens (NFTs) have defied expectations, with second-quarter sales exceeding market projections for the period.
According to blockchain sales tracker DappRadar, NFT sales in Q2 slightly exceeded those from earlier in the year, closing the first half at $2.4 billion compared to $2.3 billion at the end of March. The DappRadar report also showed that NFT sales are up by a staggering 111.46%, and active wallets have surged by 151.89% in Q2.
Market watchers find this surprising as the value of NFTs is usually tied up with Bitcoin’s market performance.
While Bitcoin hit an all-time high of $63,000 in April, its performance has taken a steep downturn over the following months. Yet, surprisingly, while confidence in Bitcoin and cryptocurrencies in general has eroded, the market’s appetite for NFTs remains strong.
In March of this year, NFTs took the lead when digital artist Beeple’s abstract masterpiece “Everydays: The First 5,000 Days” was auctioned off by a record-breaking $69,346,250 at renowned auction house Christie’s.
Since then, NFT sales do not seem to have been affected by the Bitcoin slump, exceeding their performance in the first quarter and smashing experts’ projections.
What’s fuelling the NFT Rise?
While art is the first thing that comes to mind when people talk about NFT, the term now encompasses a number of things, including keys that give holders access to a number of privileges as well as perks in online game play.
It is a step towards what industry watchers have been predicting for some time now: that NFTs will eventually be interwoven with modern living and culture.
For example, the Bored Ape Yacht Club has made $70 million in NFT sales since it opened its virtual doors in May of this year. The members-only collectibles group currently uses NFTs as membership cards or badges for its members. In addition, it allows them exclusive access to their Discord server, an online freedom board referred to as The Bathroom, and an exclusive chat group on Telegram.
Online gaming is another area where NFTs are gaining headway. For example, the trendy play-to-earn game Axie Infinity may look like another Pokemon clone where players can hunt, breed, and sell mythical creatures called axies, making serious money as they play.
Earlier this month, the game earned approximately $30 million in membership fees, surpassing the combined take of several major cryptos – including Bitcoin and Ethereum – throughout the same period.