February 2024 NFT Industry Update: Cryptocurrency Soars, NFT Market Adjusts
In February 2024, although cryptocurrencies soared, the NFT market experienced a slight adjustment.
Author: stella@footprint.network
Data Source: NFT Research Page - Footprint Analytics
In February 2024, the cryptocurrency and NFT markets exhibited complexity. During the month, the trading volume in the NFT sector reached $1.2 billion, a month-on-month decrease of 3.7%. Notably, well-known NFT collections such as Azuki, MAYC, and BAYC experienced significant declines in trading volume across public chains like Ethereum, Polygon, BNB Chain, Cronos, Optimism, and Sui, with a drop of up to 32.1%. Additionally, the performance of the Gas Hero game NFTs was poor, affecting platforms like Polygon and Mooar. Meanwhile, new narratives such as ERC404 and DN404 emerged during this period.
This report is based on data provided by Footprint Analytics' NFT Research Page. This page is a comprehensive and user-friendly dashboard that provides the latest statistics and metrics necessary to understand the pulse of the NFT industry, including trading, projects, financing, and more.
Cryptocurrency Market Overview
In February 2024, both Bitcoin and Ethereum showed significant growth. Bitcoin surged by 46.5%, closing at $62,404 at the end of the month, breaking the $60,000 mark for the first time since Q4 2021, just 9% shy of its all-time high. Ethereum performed even better, with a slight increase over Bitcoin at 48.1%, closing at $3,383.
Data Source: Bitcoin and Ethereum Prices - Footprint Analytics
The significant rise in the cryptocurrency market in February was driven by multiple factors. Among them, the U.S. spot Bitcoin ETF attracted up to $6 billion in inflows during February, highlighting investors' strong confidence in cryptocurrency as an effective store of value. Additionally, market expectations for the Ethereum Cancun upgrade in March and the Bitcoin halving event in April further boosted prices. These factors collectively provided strong support for the rise in the cryptocurrency market.
However, broader market dynamics, such as inflation concerns and Federal Reserve policies, may pose challenges to sustained growth. The rise in inflation in February suggests that anticipated interest rate cuts in the U.S. may be delayed until later this year or even beyond, undoubtedly introducing uncertainty into the continued growth of the cryptocurrency market.
NFT Market Overview
In February, despite the significant growth in the overall cryptocurrency sector, the NFT market faced a decline. The trading volume in the NFT market reached $1.2 billion, a month-on-month decrease of 3.7%.
Analyzing data from public chains such as Ethereum, Polygon, BNB Chain, Cronos, Optimism, and Sui, we found that trading volume dropped to $840 million, a decline of 16.1% from January. Additionally, trading volume fell by 25.8%, and the number of unique users (wallets) decreased by 14.6%. This downward trend is partly attributed to the shorter number of days in February. Furthermore, significant fluctuations in key NFT collections, changes in market dynamics, and shifts in investor sentiment also contributed to the downward trend.
In February, the total trading volume of the top ten NFT collections on the six public chains plummeted from $570 million in January to $390 million, a staggering decline of 32.1%. These collections accounted for 46.2% of the total market trading volume in February, down from 56.2% in January.
Data Source: Top Ten NFT Collections by Trading Volume in February 2024 - Footprint Analytics
The trading volume of the January leader Azuki saw a significant drop of 73.7%, falling to $32.6 million. Meanwhile, both Mutant Ape Yacht Club (MAYC) and Bored Ape Yacht Club (BAYC) also experienced declines of 42.0% and 18.2%, respectively.
Although the trading volume of Pudgy Penguins decreased by 32.8% to $64.08 million, it still stood out as the highest trading volume collection in February. Its floor price increased by 15.0%, nearing the floor price of BAYC. Meanwhile, Walmart expanded its collaboration, introducing Pudgy physical toys to an additional 1,100 stores in the U.S., bringing the total to 3,100. This move not only enhanced the market influence of Pudgy Penguins but also marked an important step in the mainstreaming of Web3 intellectual property (IP), helping to strengthen its market share.
In eighth place was Moonbirds, with a trading volume of $27.8 million. Notably, Yuga Labs announced on February 16 that it had acquired PROOF, including Moonbirds and other assets, which quickly boosted the floor price and trading volume of Moonbirds.
The Nobody NFT collection, created in collaboration between Nobody and Hong Kong director Stephen Chow, achieved a trading volume of $36.6 million, ranking fifth. This series was launched on the Moonbox platform, which aims to introduce AI-driven NFTs in the fields of art and film. This release marks Stephen Chow's official entry into the NFT space.
Nobody NFT Series
Public Chains and NFT Trading Market
In February, Ethereum continued to dominate the NFT market, with a trading volume of $810 million, accounting for 97.1% of the total market trading volume. Although this figure decreased compared to January, Ethereum's market share slightly increased. Meanwhile, Polygon performed poorly, with its trading volume plummeting from $110 million in January to $20.4 million, causing its market share to sharply decline from 10.4% to 2.4%.
Data Source: Monthly NFT Trading Volume by Public Chain - Footprint Analytics
The number of unique users (wallets) on Ethereum decreased from 163,000 in January to 150,000 in February; nevertheless, its market share rose from 42.7% to 46.9%. Polygon's user count also declined to 129,000, leading to a drop in its market share to 40.4%. Meanwhile, the market share of BNB Chain grew moderately by 9.7%, with its user count reaching 31,000.
Data Source: Monthly NFT User Count by Public Chain - Footprint Analytics
According to data from Footprint Analytics, in February, the NFT trading volume of the Web3 game Gas Hero, developed by Find Satoshi Lab, plummeted by 87.2% to $12.3 million, a stark contrast to its trading volume of $96.1 million in January when it launched. This decline significantly impacted trading activity on the Polygon and Mooar platforms, leading to a noticeable reduction in trading volume. The Gas Hero team announced a strategic adjustment on February 28, returning to a closed testing phase to optimize the economic model and enhance user experience.
Data Source: Daily Trading Volume of Gas Hero NFT Series - Footprint Analytics
In February, Blur continued to lead the NFT market, although its trading volume fell to $610 million, its market share increased from 68.3% in January to 73.1%. OpenSea saw a slight increase in trading volume to $170 million, successfully raising its market share to 20.5%, reversing its previous downward trend. However, due to the aforementioned issues with Gas Hero, Mooar experienced a significant drop in trading volume to $12.3 million, leading to a sharp decline in its market share to 1.5%.
Data Source: Monthly Trading Volume Share of NFT Marketplaces - Footprint Analytics
Despite the number of unique users (wallets) decreasing from 279,000 in January to 224,000, OpenSea still maintained its leadership position in the NFT market due to its large user base. Meanwhile, the number of users on Blur increased to 61,000, while the number of users on Element slightly decreased to 36,000.
Data Source: Monthly User Count of NFT Marketplaces - Footprint Analytics
NFT Investment and Financing Situation
Public records show that the NFT market underwent three rounds of financing in February, marking a period of relatively subdued investment activity. Despite the overall slow progress, Animoca Brands was particularly active.
Binance Labs announced an investment in one of its sixth season (S6) incubation projects, NFPrompt.
The WELL3 project developed by YogaPez successfully raised over $5 million through seed round financing and NFT sales, led by Animoca Brands, Newman Group, and Soul Capital Partners.
Imaginary Ones, a unique animated 3D character NFT series, recently completed a new round of financing with participation from investors such as Cypher Capital Group, Animoca Brands, and MH Ventures.
Key Developments This Month
Pudgy Penguins physical toys will be sold in an additional 1,100 Walmart stores.
Yuga Labs acquired PROOF and Moonbirds.
Pandora proposed the ERC-404 concept, with its token skyrocketing by 12,000% within a week.
The Ethereum marketplace in collaboration with Yuga Labs launched on February 27.
Solana NFT cumulative trading volume surpassed $5 billion.
As Bitcoin prices approached historical highs, NodeMonkes led Bitcoin Ordinals to set new records.
The above research report data includes:
Public Chains: Ethereum, Polygon, BNB Chain, Cronos, Optimism, Sui
Trading Marketplaces: OpenSea, LooksRare, Blur, X2Y2, Cryptopunks, Rarible, SuperRare, Foundation, Decentraland, Aavegotchi, Element, Era7, the Sandbox, Minted, Clutchy, BlueMove, Hyperspace, Tocen, Keepsake, Mooar
The content of this article is for industry research and communication purposes only and does not constitute any investment advice. The market carries risks, and investment should be cautious.
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