NFT market experiences worst year since 2020 with 20% decline

The non-fungible token (NFT) market faced significant challenges in 2024, marking its worst performance since 2020.

According to a report by DappRadar published on January 14, NFT trading volumes dropped nearly 20% compared to the previous year, totaling $13.7 billion.

Sales counts also fell by 18%, nearing just under 50 million transactions, indicating a substantial decline in market activity.

Despite a brief uptick in trading volumes during the first quarter of 2024, which saw a 4% increase to $5.3 billion, the momentum was short-lived.

Trading volumes plummeted to $1.5 billion in the third quarter before rebounding slightly to $2.6 billion in the fourth quarter.

DappRadar noted that the overall decline in sales counts suggests that NFTs became generally more expensive throughout the year, aligning with rising token prices, particularly for Ether (CRYPTO:ETH).

The report highlights that while the broader crypto market experienced a revival—exemplified by Bitcoin's (CRYPTO:BTC) impressive 125% gain in 2024—the NFT sector struggled to recover.

In contrast, the NFT market had its peak year in 2022, with trading volumes reaching $57.2 billion and sales counts hitting 121.7 million.

Gaming-related NFTs emerged as a dominant category, with Epic Games' trading card game Gods Unchained (CRYPTO:GODS) leading sales at $152 million, despite a 27% decline from the previous year.

Pudgy Penguins (CRYPTO:PENGU) topped overall NFT collections by trading volume, which surged over 140% from 2023 to $786 million, although sales count decreased by 44%.

The collection's success is attributed to its expansion into real-life utility through merchandise and partnerships.

“Perhaps 2024 helped us realise that NFTs don’t need to be expensive to prove their importance in the broader Web3 ecosystem,” DappRadar concluded, emphasising the evolving nature of this digital asset space.