OpenSea Trading Volume Drops By 99%, What Does It Mean?

Hey friends,

Some interesting stories from the last couple of days with MTVs first feature of NFTs, to the truth on the 99% decrease in NFT activity that has been circulating headlines.

Snoop Dog And Eminem Show Off Their Bored Apes At The VMAs

The VMAs (Video Music Awards) hosted by MTV are said to basically be the Oscars for music videos. On Sunday night, MTV introduced the Metaverse for the first time ever through a live performance of “From The D 2 The LBC” with Snoop Dog & Eminem alongside their Bored Ape avatars. The legendary rappers came together for their latest single that had the VMAs filled with trippy visuals as the duo switched between 3D renders of themselves and their Bored Ape avatars. The whole video is quite the journey as Snoop and Em are transported through all kinds of bizarre backgrounds and locations, hinting at what the upcoming Yuga Labs Otherside Metaverse. Otherside will be the home to the Bored Apes, and although the visuals were not necessarily gameplay footage, it had some obvious references such as the duo meeting the Koda avatars who are the “mysterious” creatures that hold the Otherside microverse intact. This bold statement by MTV about promoting the Metaverse to an audience unfamiliar with the Web3 world was a collaboration with the founders of Bored Ape Yacht Club, Yuga Labs. The collab further shows the credibility of these growing Web3 platforms as they become more and more involved with existing “real-world” brands. There was plenty of negativity with some people labeling the video as “a bad instagram filter”, but it's hard to not see this as a positive with it being over 20 years since these rap icons last performed together on this stage. The publicity for NFTs on this type of stage just displays how the momentum of this new technology keeps growing.

Netflix Evolving Streaming For Web3

To commemorate the launch of the third season of Love, Death + Robots, Netflix has recently released an NFT collection on OpenSea. We now have the recent data on the success of the project, and it's opened some interesting ideas on the future of media that is worth covering. There is a big need to break away from the misconception of NFTs being a speculative market for investing. Taking a look at the trading volume of the Love, Death + Robots collection on OpenSea will quickly show you that this collection never had any intention of holding monetary value. Yet it still had over 32,000 people on a treasure hunt for QR codes that could grant them a mint of the collection. What makes Netflix's recent step into Web3 so noteworthy is the truly unique engagement data that Netflix is able to collect. Media platforms have come a long way since TV ratings which may only tell you viewership numbers, but through data on what episodes have the highest sales numbers or effort put into a hunt, platforms like Netflix are able to have new ranking systems of episodes giving new gauges on true ratings for a show, helping future seasons with informed decisions related to the productions. Free NFTs giving new rating systems for online media platforms is probably not something we expected, but further shows the versatility of this new technology.

OpenSea Volume Drops 99% From Record High

OpenSea has been the go-to marketplace for Ethereum NFTs as an early “Amazon of NFTs”, but with the recent bear market, we have just had a new low when August 28th saw $5 million worth of transactions (DappRadar). That is a 99% drop in trading volume since the all-time peak on May 1st when OpenSea traded $406 million. If we zoom out to a monthly timeframe, Dune reports a 90% drop since the January 2022s peak of about $4.85 billion. Do these considerable drops in NFT transactions mean a diminishing interest in the technology? Well, as always, there's more than meets the eye. You will see this “NFTs drop 99%” headline everywhere at the moment as NFT FUD continues to grab attention, but it's not necessarily a fair story with the May 1st peak coinciding with the outlier of the largest NFT mint ever when Yuga Labs Otherside Otherdeed land minted for $317 million USD and through secondary sales on OpenSea traded 112,788 Eth (approx $300 million USD). These numbers are also based on fiat value, but NFTs volume has dropped considerably due to its monetary coupling to the 43% decrease in Ethereum value since May 1st. If we look at NFT transactions alone on the week of April 25th (before Otherdeed mint) there were 394,179 NFT transactions on OpenSea according to Nansen. On the week of August 29th, there were 342,854 NFT transactions on OpenSea, which is only a 13% drop in NFT transactions.

We bring up this point because although the monetary value is focused on, its important to remember NFTs are not just a speculative investment, but a technology that is continuing to build momentum in many industries. When looking at the long-term potential of NFTs it's important to not only look at statistics that are not coupled to monetary value, but others such as the consistent 5-10k first-time NFT buyers every day, reported by Nansen. If you want to see more long term growth statistics, checkout the NFT Trends & Indexes on nansen here which gives you things like; users per hour, transactions per week, user activity, buyers per day, and more. When looking at these trends which purely focus on NFTs, you won't find anything close to a 99% decrease, so remember don't believe everything you read on the internet, and I highly recommend checking out the Nansen indexes here.

Thanks for joining us today, hope you enjoyed this edition of Morning NFTea and we will see you in a couple days.

Connect with us on socials for a more personal experience! 👇

Twitter + Discord

Recent Articles

Gordan Ramsay Creating A NFT Game??

Celebrities Receive Warning For Shilling NFTs??

What Does The Etheruem 2.0 Merge Mean For NFTs?

Should NFTs be hidden on the blockchain??

American Express Backing NFTs??

DISCLAIMER:

None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.