Active users up on NFT marketplaces on Solana
The price of Solana’s native SOL token has fallen considerably from its all-time high of $260 last November to around $105 today. Nonetheless, as the value of SOL falls, so has the value of NFT digital collectibles on Solana marketplaces priced in SOL. The price drop has resulted in a surge of activity as NFT collectors look to grab a bargain.
Solana was on an impressive run throughout 2021 that saw the value of its SOL token rise over 2400% in a year. However, the price tumble beginning in November and coming to a head in January 2022 has knocked more than 50% off the value at the time of writing.
While the fall in the price of SOL perhaps spelled quieter times ahead for the network’s DeFi and finance dapps. Leading NFT marketplaces on Solana see a notable surge in active wallets, transactions, and trading volume.
January NFT sale
The core reason is that NFTs on Solana are priced in SOL. Simply put, an NFT that on November 7 cost 20 SOL or around $5100, will now cost about $2000. Moreover, some NFT admirers may have bought at the peak and now might look to recoup some losses.
Investors can use NFTs as a store of value during a bear market with the hope that once the value of SOL rises, the NFT valuation will go hand in hand. Additionally, some collectors may have been put off by a high-priced item that they can now scoop up at a discount.
Looking at the last seven days on Solana, we see that while the DeFi and finance dapps are all experiencing a dip in active wallets interacting with their platforms, NFT marketplaces on Solana are surging. Interestingly, we see one of the platform’s first play-to-earn games, SolaJump, gathering users quickly as blockchain games continue to attract mass audiences.
At the time of writing, Magic Eden has seen over 96,000 traders generating more than $57 million in trading volume. While Solanart has increased trading volume by over 140%, taking it to $6.5 million over the last seven days.
One collection that’s proved popular on Solanart is SolPunks. A tip of the hat to the original CryptoPunks on Ethereum, these knock-offs, while a fraction of the cost of their OG counterpart, are still not the cheapest.
Looking at the trading history of the item shows more clearly the deep discounts available right now for buyers. A punk that traded just five months ago for 27 SOL is currently selling for 5 SOL. Even if the price had stayed at 27 SOL, the discount would be significant. However, as collectors look to perhaps offload NFTs bought at the peak, they appear to be willing to settle for less than they paid. Showing to some extent the mindset and knowledge levels of some newer NFT investors.
Interestingly the original mint price of a SolPunk was 3 SOL, meaning today’s prices were perhaps much more in line with reality than at the height of NFT fever back in August 2021.
While NFT admirers are picking up discounted collectibles on Solana, the same can’t be said for other collections on Ethereum that appear to rigidly hold value despite the dip in crypto prices. In the past two weeks alone, Justin Bieber picked up a BAYC NFT for over $1.3 million, while Eva Longoria and Gweneth Paltrow dived headfirst into NFTs with the help of crypto firm Moonpay.
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The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research. The writer holds ETH, BTC, AGIX, HEX, LINK, GRT, CRO, OMI, IMMUTABLE X, GALA, AVASTR, GMEE, CUBE, RADAR, FLOW, FTM, BNB, SPS, WRLD, ATOM, and ADA.
