State of the Market

We’re now well into the 2nd month of the year and, thankfully, NFT interest remains high. OpenSea saw over $1B in transaction volume for the 5th consecutive week as the number of unique NFT buyers continues to trend higher.

Wash trading volumes on LooksRare also remain high, but it’ll be interesting to see what happens after the halving of trading incentives today (February 9th); we expect volumes will drop considerably until a new equilibrium is reached where wash trading is still profitable.

After filtering for wash trading volume, daily transaction volumes on LooksRare remains <$15M on most days. The number of Daily Active Users has also remained stagnant, and is far below the number seen on OpenSea. The team has continued to build and improve the product over the last several weeks (for example, they released an easier way to filter your NFTs and check floor prices), which could lead to a pick up in these metrics if LooksRare is able to retain users, even as it scales back on trading incentives.

As mentioned in last week’s NFT insights, Gem is a new NFT marketplace aggregator that launched in January and is optimized to reduce gas fees for users. Gem is gaining on Genie in terms of transaction volumes and daily active users, with volumes on Gem exceeding those of Genie over the last week. Marketplace aggregators will likely continue to be a major theme in 2022 as more marketplaces spring up to compete against OpenSea.

Note: We are watching marketplace activity on other chains and will continue to include relevant marketplaces once they achieve meaningful volumes (relative to overall activity). We covered NFT activity on other chains briefly in this week’s chartbook report, which also highlights a handful of other notable NFT-related trends.

Top NFT Collections This Week

This week, NFT collections are bathing in a sea of red. It’s almost as if everyone collectively decided to take profits and sell once January came to a close. Even “blue chip” collections like Bored Apes and CryptoPunks have fallen 15 – 20% this week (measured in ETH).
Some of the top performing collections the past few weeks like Zipcy’s SuperNormal and Lives of Asuna are now down over 70% from last week. Pre-reveal hype and expectations of Azuki-type parabolic returns led to the run up in