๐Ÿง‘โ€๐Ÿš€ Are NFTs Back?

Banklessยทยท5 min read
Crypto/Web3Finance
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AI Summary

Top Ethereum NFT collections including CryptoPunks, BAYC, and Azuki surged 15-148% over the past week while BTC and ETH remained flat. The overall NFT market cap sits at $2B, its lowest since summer 2021, raising questions about whether this is a genuine recovery or a temporary rally. Analyst William Peaster notes the move lacks a clear catalyst and cautions that sustained volume across smaller collections would be needed to confirm a real breakout.

Key Facts

โœ“Top Ethereum NFT collections surged 15โ€“148% over the past week while BTC and ETH remained essentially flat.
โœ“The total NFT market cap is at $2B, its lowest since summer 2021, meaning less capital is required to move prices โ€” raising questions about whether this rally is real or a liquidity mirage.
โœ“Analyst William Peaster says the true signal to watch is sustained trading volume and buying pressure spreading beyond blue-chip PFP collections into smaller projects.

Author Takes

SkepticalMetaversal by Bankless

NFT market rally

The current NFT rally likely lacks a singular catalyst and may be temporary hopium in the absence of higher-beta ETH DeFi plays, not the beginning of the next major NFT bull market.

BearishMetaversal by Bankless

NFT market cap context

At $2B market cap โ€” last seen in summer 2021 โ€” it takes far less money to move NFT prices today than at peak ($16B in April 2022), so current price surges are less meaningful than they appear.

Contrarian Angle

NFT Supply Illusion Thesis

TheJPEGGallery argues that most 10k NFT projects have far fewer items actually available due to lost wallets and inactive holders, making the effective circulating supply much smaller than perceived โ€” setting up a supply shock breakout.

Conventional analysis counts total supply; this thesis focuses on truly circulating supply, implying NFT scarcity is far greater than market cap figures suggest.

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