Number of Ethereum NFT traders falls below 4,000 for first time since June 2021

There has been a lot of excitement in the broader crypto market this year, but the non-fungible trading sector continues to lag.

While there has been the occasional bright spot for NFT announcements, including an Adidas partnership with Stepn slated to begin with an NFT collection and the announcement of the upcoming 2025 release of the Pudgy Penguins game based on both their NFT collection and their associated toy line, which sold one million units in less than a year; it has largely been mostly negative headlines about NFTs or a lack thereof.

The negative headlines primarily focus on the declining valuations and activity within the NFT space. Nobody wanted to buy the Coachella NFT VIP passes and Starbucks shut down its Odyssey Beta NFT program. The Bored Ape that was once owned by Kevin Hart sold for 83% less than what he paid for it, and the trading volume for the original Donald Trump NFT collection was plummeting ahead of the start of his criminal trial.

While some collections catch the attention of the public eye, it has broadly been the trend that most collections have seen slowing volumes and most collections have seen floor prices dropping, including this year’s most hyped NFT subcategory, Bitcoin Ordinals. As we talked about a few weeks ago, activity on Bitcoin has been overtaken by Runes, putting memecoins at the center of attention and Ordinals left to the wayside.

Monthly NFT marketplace volumes on Ethereum have declined since January, and even in January, volumes still paled compared to the billions of dollars being traded each month during the 2021/2022 bull market. In May, volumes didn’t even exceed $500 million.

Perhaps the most jarring metric is the number of daily Ethereum NFT traders, which fell below 4,000 for the first time since June 2021. The number was over 80,000 at its peak back in February 2022 and has been on a decline ever since, although the number of users flatlined from June 2023 through February 2024 but then began a slow decline again.

The NFT landscape on Ethereum might be facing tougher challenges as we have seen that other, cheaper alternatives have managed to attract activity away from the once de facto blockchain for most use cases. While Ethereum is still home to the majority of the blue-chip NFT collections, its dominance has faded.

It’s not clear what exactly could reignite an NFT boom given some recent big brand partnerships haven’t been shaking out well. It would likely take a new trendy collection or a new marketplace with incentives to get things moving again.

This is an excerpt from The Block's Data & Insights newsletter. Dig into the numbers making up the industry’s most thought-provoking trends.