As the crypto industry appears to be sinking lower into a bear market, or at least a bearish market, the NFT industry is experiencing its first deceleration in trading volume. How will the market react? In recent days, it looks like institutions are taking advantage and using this opportunity to buy in at a cheaper price.
Leading NFT marketplace, OpenSea, has seen a massive decrease in sales and trading volume compared to the peak in December and January. It has coincided with major choppiness in the price of both Bitcoin and Ethereum, which have subsequently dragged down the price of most other crypto tokens. Ethereum’s price in particular has a major effect on the NFT marketplace, as the Ethereum layer-1 blockchain continues to be where a majority of NFTs are minted and sold.
But there is some big money still flowing into NFTs even if the social media side of things has gone silent. Shopify (NYSE:SHOP) is one of the bigger companies that has thrown its hat into the Metaverse and NFT space recently. The Canadian eCommerce company now allows its users to start their own NFT marketplaces to sell their NFTs, which means we could see a major influx of NFT artists selling their own work as we move towards Web3.0.
One of OpenSea’s major competitors just received backing from one of the largest private equity firms in the world, Sequoia Capital. Magic Eden, a Solana-based NFT marketplace received $27 million in the recent round of funding. Sequoia believes that the Solana blockchain can make a dent in the space as a more efficient and more affordable protocol for NFTs than the Ethereum layer-1.
This speaks volumes to how institutions are eyeing this market. It’s not an OpenSea monopoly like many believe it to be. In fact, as the Metaverse and Web3.0 become more integrated into our digital lives, we’ll likely see a long list of NFT startups making the leap. One such company could be Clickstream Corp (OTC:CLIS) which offers its musical NFT marketplace, Nifter. While many think of NFTs to be digital JPEGs, Nifter is employing the major tenets of Web3.0, by allowing artists to get paid directly for their work without a financial intermediary.
Platforms like Nifter and blockchain-based, Audacity, are changing how we view NFTs in general. They aren’t just limited to images we put as our profile pictures, they have the ability to be legitimate sources of income for musical artists and other mediums. Nifter is already doing what people thought Block (NYSE:SQ) would do when it acquired Tidal. While the NFT industry remains quiet, companies like Nifter are positioning themselves for a strong rebound and the emergence of Web3.0.
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