After generating over $44 bn in revenue in 2021, NFTs posted a 75% fall in the volume of spending in the first quarter, according to the Chainalysis platform.
The collapse of cryptocurrencies—which back NFTs—is the main reason for this spectacular downturn. Also according to Chainalysis, in the first quarter, 20.9 million transactions were made during the months when Ether was rising. When the cryptocurrency price fell, the volume dropped to 12.7 million transactions. This could have a significant impact on the art market since 95% of NFT buyers worth over $25,000 are more interested in a quick return on investment, according to the Hiscox Group. But for now the crypto-art market, which mostly involves genuine enthusiasts, is only slightly affected by cryptocurrency fluctuations.