According to DappRadar data, the volume of sales of non-fungible tokens (NFTs), jumped to $10.7 billion in quarter three of 2021. This is more than eightfold increase over the previous quarter. It was a result of the crypto asset frenzy reaching new heights.
NFTs use blockchain technology to track the ownership of digital objects such as images, videos and collectibles, and even land in virtual realms.
Many are baffled by the soaring sales and high prices for NFTs, which are items that do not exist physically. However, the rapid growth is not slowing down.
DappRadar reported that the third quarter figure was $1.3 billion higher than Q2’s $1.2 billion and Q1’s $1.2 billion, respectively.
OpenSea, the largest NFT marketplace, saw sales of $3.4 billion in August. Even in September, when global stock markets crashed, activity remained strong.
The COVID-19 pandemic
The COVID-19 pandemic was often cited by NFT market participants as the driver of NFT market growth. People use cryptocurrencies to purchase NFTs, but crypto enthusiasts claim that they have value independent of market conditions.
It is possible to estimate the NFT market’s size differently depending on the information included. The data often does not capture transactions that occur “off-chain”, like NFT art sales at auction houses.
DappRadar’s data, which includes multiple blockchains as well as “off-chain” transactions puts total 2021 sales volume around $13.2 billion. CryptoSlam, another market tracker, states that the figure is $9.6 Billion.
NonFungible.com tracks NFTs only on the Ethereum blockchain and puts the total volume for 2021 at $7 billion.
A digital collage that Christie’s sold for $69.3 Million in March was the most expensive NFT sale. Despite not being able to sell any NFTs at this price since then, auction houses continue to hold NFT sales that often reach millions.
Despite the growing popularity of NFTs and the celebrity and other investors jumping on it, there are still very few buyers: in Q3, NonFungible.com reported that only 265,927 wallets traded NFTs on ethereum blockchain.
According to NonFungible.com, more than half of NFTs were sold between $101 and $1,000 in Q3. 20% of NFTs were in the $1,001-$10,000 range, while 17% of NFTs were less than $100.
One NFT brand to see particularly high growth in Q3 was Art Blocks, a U.S.-based project which sells NFTs of algorithmically-generated digital artworks.
An Art Blocks NFT was sold on Saturday for 2,100 Ethereum (roughly $6.9 million). According to CryptoSlam, the average Art Blocks price has risen to $15,100 per NFT in September from $3,300 in July.
Gaming-related NFTs saw a surge, with Axie Infinity, a blockchain-based gaming game, leading the “play to earn” sector with $776m in Q3 revenues. DappRadar also reported that Axie Infinity, a blockchain-based game, was the most successful with $776m.