The NFT token market is showing the first signs of life after a brutal sell-off that wiped out about $1.2 billion in capitalization in Friday’s cryptocurrency crash. And although there is still a long way to full health, the pace of recovery may positively surprise even fierce skeptics.
Top NFT collectibles continue to bleed
Despite a partial recovery, most top NFT collections remain deeply depressed on a weekly and monthly basis. Ethereum’s flagship projects such as Bored Ape Yacht Club (BAYC) lost 10.2% during the week, while Pudgy Penguins suffered an even more painful blow – minus 21.4%. Collections like Infinex Patrons and Fidenza by Tyler Hobbs recorded double-digit losses on the monthly charts.
CryptoPunks, the absolute hegemon of the NFT market in terms of capitalization, fell by 8% in a week and nearly 5% in a 30-day perspective. This is a clear signal that even the most sophisticated projects are not immune to turbulence.
However, all is not lost. Some collections showed slight signs of life on the 24-hour charts. Hypurr NFTs from the Hyperliquid ecosystem gained 2.8% and Mutant Ape Yacht Club (MAYC) rose 1.5%. This may suggest that selective buyers – those with cool blood and cash in their wallets – are slowly returning to the market, looking for opportunities.
Flash Crush – geopolitics collided with digital assets
Friday’s massacre is a direct result of the geopolitical earthquake. President Donald Trump announced the introduction of 100% tariffs on China in response to attempts to limit the export of rare minerals. Bitcoin immediately fell to the level of 102,000. USD on the Binance futures pair, and the entire cryptocurrency market shrank from USD 4.24 trillion to USD 3.78 trillion in just two days. This is a loss of almost USD 460 billion – a dizzying amount.
Liquidations of positions reached a staggering $20 billion, even exceeding the chaos of the FTX collapse. The market partially recovered on Monday, reaching a valuation of $4 trillion, although the value has fallen to $3.94 trillion at the time of writing.
Paradoxically, at the same time, crypto-ETFs attracted USD 3.17 billion in new inflows, as reported by CoinShares. This is proof that institutional investors not only did not pack their bags, but actually took advantage of the panic to increase their exposure. The resilience of these funds to market chaos deserves recognition.
The NFT market is rearing its head and has not yet said its last word
The NFT market has proven once again that it is as sensitive as a seismograph to the vitality of the broader cryptocurrency market. But if this cautious return of buyers continues and turns into a lasting trend, we could be witnessing a fascinating chapter in the history of digital collections. Will the NFT craze return? Certainly not on such a scale as in 2021, but investors may still be surprised 😉
