Introduction
NFTs are blockchain certificates authenticating ownership of a unique asset. Sometimes referred to as non-fungible tokens, these individual assets typically come in the form of art but also have a variety of additional use cases across gaming, collectibles, and financial applications.
NFTs grant the ability to own title on property in the form of a fully transferable digital token, and the NFT space remains replete with latent potential. The Ethereum Name Service (ENS) represents just one example of NFT technology being used to drive mass adoption, with users being able to register unique names to typical blockchain addresses..
These irrevocable digital certificates of ownership will change the world, and this article outlines vital statistics giving users a snapshot of the current state of their adoption. Nansen also provides a broader guide to NFTs here: Everything You Need to Know About NFTs.
NFT Market Statistics
Nansen’s dashboard shows that to date in 2022 the Ethereum NFT sphere has seen 8.22 million ETH in trading volume across 2.46 million unique wallets.
The NFT market possesses a total market cap of more than $11.3 billion. To better facilitate an understanding, this is equivalent to and greater than the Gross Domestic Product of many small countries such as Kosovo, Togo, and Somalia. Staggeringly, the total value of the NFT market exceeds in value all the goods and services produced in many nation states!
This data comes from a report published by Verified Market Research (VMR) which further predicted a compound annual growth rate of 33.7% in the following eight years and a prediction that the NFT space will see its total market cap climb to $231 billion by 2030.
The central driver of growth and demand for NFTs currently is collectibles. They have penetrated key industries starting with art and music but rapidly expanding to film, sports, fashion, gaming, the metaverse, ticket sales, supply chains, and luxury goods. Few areas are untouched by NFT technology, and they are steadily growing beyond their fashionable purpose of social clout. For investors interested in owning their own NFT check out Nansen’s guide on becoming an NFT investor: How to Invest in NFTs.
NFT Ownership Statistics
Interestingly roughly 50% of all recorded NFT sales are less than $200, showing that a large part of NFT growth occurs at a grassroots level, and people earning less than $25,000 a year invest at a similar rate to those earning over $150,000 a year.
Nansen’s dashboard shows that since April 2022, we’ve seen a constant stream of ~250k wallets have interacted with NFT platforms a week on Ethereum. The bulk of this trading is split between the largest NFT marketplace, OpenSea, and new mints.
The most explosive NFT adoption occurs in Southeast Asia; in the Philippines 32% of the population own an NFT, Thailand 26.6% own an NFT, and Malaysia 23.9% own an NFT, according to research from Finder.
The country with the greatest projected adoption is Nigeria, where 21.7% of the population does not currently own an NFT but has plans to acquire one.
In the United States, 4% of the total population owns an NFT, which is a 100% increase from the year prior, and California residents buy more NFTs than any other state. However, the majority of the population globally still does not know what an NFT is. Nearly 80% of the United Kingdom’s population did not know what an NFT was when asked, and 70% did not know in the United States.
NFT Growth Statistics
The year 2021 saw NFTs explode and experience parabolic growth. Accompanied by a raging bull market, an incredible amount of capital washed into the space. Despite harsh criticism from detractors revolving around two central points – the environmental impact, and the speculative bubble – NFTs have remained, and the bear market forces the sphere to move towards greater utility.
The third quarter of 2021 saw NFT trading volume increase by more than 700% compared to Q2 of the same year. Thousands of NFTs change hands daily across various marketplaces, with anywhere from 15,000 to 50,000 being exchanged in any given week. This figure shows a drastic increase since 2017 when NFT trading volume was limited to less than 100 NFTs a week.
OpenSea has seen 1.85 million transactions, 300,000 unique wallet addresses interacting with smart contracts, and 350,000 ETH trading volume in September 2022. And despite the declining overall volume, the number of individual users and transactions remains steady.
Nansen’s Contract Activity dashboard shows strength and volume returning to smaller projects highlighting the establishing trend of persistent NFT investors remaining active in the space.
Data gathered by Statista showed that the total NFT market cap grew close to tenfold between 2018 and 2020. Projects like NBA Topshot generated close to $1 billion in total sales. NFT sales grew by a factor of 131 from Q1 2020 to Q1 2021. And this collectibles market remains the fastest growing area within the digital asset space.
NFT Art Sale Statistics
Digital artist Kevin McCoy and coder Anil Dash arguably minted the first NFT in May 2014, titled Quantum. This NFT sold at auction years later for $1.4 million. But it does not even come close to the top NFT sale, which was a series created by digital artist Pak known as The Merge, which sold for $91.8 million. The second most expensive NFT sale belonged to Beeple, who sold an NFT titled ‘Everydays: The First 5000 Days’ for a staggering $69.3 million.
Nansen’s Art Index shows a broader overview of NFT Art value. With these collections typically having a lower supply or existing as one off pieces, this index is rebalanced every 90 days to develop a picture of all the transactions within this space.
A large percentage of NFT sales come from NFT Collections, two classic examples being the Bored Ape Yacht Club and CryptoPunks. The 10,000 strong troop of primates collectibles have seen a total trading volume in excess of $2 billion since their inception, with an average sale price of $75,000. The pixelated punks have seen a similar total volume and have an average sale price of $107,000 according to NFT. And the importance or social worth of these NFTs is shown in the fact that five of the ten most expensive NFT sales ever are CryptoPunks.
The desirability of these two collections clearly displayed by Nansen, with the two collections often reflecting the daily most expensive sale.
At the time of writing collectibles remain the most popular subsector, but utility NFTs maintain a strong second, and the recent volume surge for the Ethereum Name Service further closes this gap.
The third largest recorded NFT sale was ‘Clock’, which is a digital counter displaying the number of days Julian Assange has remained in London Belmarsh Prison awaiting extradition to the United States. This sold for the equivalent of $52.7 million and is part of a larger NFT collection titled ‘Censored’.
NFT Gaming Statistics
Throughout much of the NFT boom, play to earn games featuring NFTs led. Large protocols such as Axie Infinity created millions in trading volume on Ronin, an Ethereum sidechain. Stepn based on the Solana blockchain saw users buying NFT sneakers to participate in the lifestyle app. NFTs are traded on a growing number of blockchains such as Avalanche and BNB Chain, but most of the activity currently takes place on Ethereum and Solana. Attached is a broader overview of blockchains where users can mint and trade NFTs: Top NFT Blockchains.
The NFT Gaming sector has seen the largest drawdown in value and volume throughout 2022. Certain critics would argue this is reflective of the prioritization of financial incentives by NFT gaming projects instead of the focus on enjoyment.
The number of unique wallet addresses interacting with game-related smart contracts totaled 1.3 million in 2021; this represents a 46X increase in daily users compared to 2020 according to data gathered by centralized exchange ByBit.
9.4% of the United States population have played a play-to-earn NFT game, but adoption is most remarkable in India where 34% of respondents claimed to have played a play-to-earn game. Adoption remains more prolific in Latin America and Asia, where during the pandemic, these games saw dramatic adoption as people used them as a full-time source of income.
NFT gaming remains most popular amongst men under the age of 35. In the United States, close to 18% of participants in this age bracket stated they had played an NFT-based game, this figure dropping to 7.3% from the age range of 35-54, and further to 5% of people 55 and older as reported by Finder.
Current NFT Statistics
Due to NFTs unique characteristics they are categorized as a high-risk asset. This type of asset suffers most in an increasingly risk-off macroeconomic environment as capital flees up the risk ladder towards safer investments.
However, despite these conditions, NFTs continue to move forwards driven primarily by utility applications and forays into the metaverse. As risk appetite dulls, the NFT space moves away from speculation and towards a building period.
Most NFT trading happens on the secondary market accounting for 80% of total trading volume as the primary market contracts. The market continues to become increasingly centralized with Yuga Labs acquiring both CryptoPunks and MeeBits, two of the most profitable NFT collections. This means that Yuga Labs owns projects that total more than 30% of the total NFT trading volume.
Nansen is a blockchain analytics firm synthesizing on-chain data with millions of wallets to provide investors with market alpha, allowing them to stay ahead of the majority. The NFT Paradise dashboard allows investors to monitor the entire market and target specific collections depending on fluctuations in their floor price.
The NFT Trends & Indexes dashboard clearly visualizes the overall direction of the NFT marketplace, with the highest weekly volume of 2022 seen in May, and following the capitulation of digital assets and depressed volume since. However, transactions and users per week are showing that interest in the space is still holding strong and lower volumes are due to prices of NFTs themselves retreating to a more sustainable level.
Conclusion
The NFT space saw incredible capital allocation throughout 2021, and even in the colder prevailing market conditions still sees high trading volume. Despite this, the nascency of this sphere must be held centrally in market participants’ minds. The application cases for NFTs continue to swell, and a slowdown in volume is appropriate so that companies can return to the building process.
Disclaimer
The authors of this content and members of Nansen may be participating or invested in some of the protocols or tokens mentioned herein. The foregoing statement acts as a disclosure of potential conflicts of interest and is not a recommendation to purchase or invest in any token or participate in any protocol. Nansen does not recommend any particular course of action in relation to any token or protocol. The content herein is meant purely for educational and informational purposes only and should not be relied upon as financial, investment, legal, tax or any other professional or other advice. None of the content and information herein is presented to induce or to attempt to induce any reader or other person to buy, sell or hold any token or participate in any protocol or enter into, or offer to enter into, any agreement for or with a view to buying or selling any token or participating in any protocol. Statements made herein (including statements of opinion, if any) are wholly generic and not tailored to take into account the personal needs and unique circ*mstances of any reader or any other person. Readers are strongly urged to exercise caution and have regard to their own personal needs and circ*mstances before making any decision to buy or sell any token or participate in any protocol. Observations and views expressed herein may be changed by Nansen at any time without notice. Nansen accepts no liability whatsoever for any losses or liabilities arising from the use of or reliance on any of this content.
