A recent study by NFTEvening and Storible agency has revealed a sobering truth about the state of the NFT market in 2024: most new NFT collections fail to sustain value or trading activity beyond their initial launch. Analyzing 29,079 collections launched from January to August using data from Dune Analytics and OpenSea, the research highlights the oversaturated market and declining enthusiasm for NFT investments this year.
The data indicates that a staggering 98% of 2024’s NFT projects are effectively “dead” – experiencing minimal to no trading activity since September. This high failure rate underscores the challenges facing creators who are unable to keep their projects relevant. Despite the launch of numerous new collections, interest has waned, with many NFTs struggling to attract even a handful of buyers in the first days post-release.
Even among projects that remain active, profitability is scarce. Only 0.2% of this year’s NFT drops have managed to turn a profit for their investors, with just 11.9% of actively traded collections showing any profitable returns. This paints a bleak picture for speculators who once saw NFTs as a high-reward investment; the current climate demands a more cautious approach.
Fast Drops, Quick Declines
One of the study’s key findings is the rapid decline in value for most NFTs immediately after minting. Roughly 98% of these projects saw their prices plummet by 50% or more within the first three days. Additionally, about 64% of collections saw all sales occur within just ten minutes of launching, leaving little chance for sustained interest. The lack of price growth, with 84% of collections never exceeding their initial mint prices, reflects a cooling market sentiment and a decline in speculative buying.
This quick loss in value and trading activity suggests that the NFT market, which once thrived on speculation, has lost much of its previous allure. As the space fills with collections hoping to attract a dwindling pool of buyers, NFTs are facing new demands: projects that fail to provide utility or long-term value simply fall by the wayside.
The Oversaturation Problem
The report also highlights the issue of oversaturation. With an average of 3,635 collections being minted every month, supply vastly outpaces demand. This abundance of new NFTs has created a market where only the most unique and community-focused projects have any chance of succeeding. BeInCrypto’s findings support this, citing the “dead project” phenomenon as a growing issue as creators churn out collections unable to maintain interest or trading volume.
Future Directions for NFT Projects
The implications of NFTEvening and Storible’s research are clear: creators can no longer rely on hype alone. To succeed, projects must now offer more than just collectibles. The focus is shifting towards community engagement, genuine utility, and long-term value. NFTs with real-world applications, or those that foster engaged communities, are likely to find a niche in an otherwise challenging market landscape. For investors, this evolution means exercising increased caution, thoroughly vetting projects, and looking beyond speculative flips to sustainable, value-driven opportunities.
In a market where profitability is elusive and oversaturation is rampant, the NFT space is at a crossroads. The once-booming market must adapt to an audience that now demands more – and only the most resilient projects will thrive in the new era.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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