NFT and Metaverse-Related Cryptocurrencies Underperform as Floor Prices Sink
Cryptocurrencies related to non-fungible tokens (NFTs) and the metaverse underperformed over the past week as sentiment about the NFT market remained sour.
The Flow network’s FLOW token, which can be used to build NFTs and decentralized applications (Dapps) such as games on the Web3 platform, slumped 20% during the past seven days. FLOW’s decline was the second largest during that period among 52 cryptocurrencies with a market cap over $1 billion, according to crypto data and analysis firm Messari.
While the general crypto market has stalled amid recent investor concerns about inflation, the economy and the pace of U.S. Federal Reserve interest rate hikes, NFT and metaverse-related token declines reflect price and profit declines for NFTs that have occurred in recent months.
According to a report from NFT data aggregator NonFungible.com, the amount of USD traded in the NFT market dropped 25% in the second quarter from the first three months. NFT resell profit also fell 46% for a total loss of $1.4 billion.
The floor price –the minimum purchase price – of an NFT from Bored Ape Yacht Club (BAYC), the largest NFT collection by market cap, is down over 50% from its high of 153.7 ETH in April 2022 to around 73 ETH. Over the past seven days, the collection’s floor price slumped 5.6%.
ApeCoin (APE), the native token of BAYC used to vote on governance decisions, slumped around 18% over the past week as investors worried increasingly that some NFTs used as collateral for loans through peer-to-peer lending service BendDAO might be liquidated due to the sinking floor price.
The price floors for CryptoPunks and Mutant Ape Yacht Club, the second and third largest NFT collections by market cap, declined 10% and 1.3%, respectively, over the past seven days.
Other NFT and metaverse-related tokens that have sunk include AXS, GALA, MANA and GMT, which all fell between 14% and 20%.