Ethereum NFT trading volume hit two-year low in August

The monthly trading volume of Ethereum-based NFTs hit its lowest level in two years last month as activity on marketplaces OpenSea, Blur, LooksRare and X2Y2 dried up.

Trading volume fell to $407 million in August, according to The Block’s data dashboard — a 32% decline from July’s $599 million and marking the lowest trading volume since June 2021. 

X2Y2 led the decline, falling 40% month-over-month — with Blur, OpenSea and LooksRare trading volumes dropping 38%, 18% and 8%, respectively.

OpenSea — which once dominated the NFT marketplace landscape and fielded investment offers at a $10 billion valuation — also saw its lowest active-user count since July 2021, according to Dune Analytics. OpenSea active users fell 12% to 126,000 in August.

Interest in blue-chip NFTs and Solana-based collections declines

While the broader crypto market has suffered significant trading volume declines, NFTs have been hit particularly hard since the 2021 market peak — indicating falling interest.

The Bitwise Blue-Chip NFT Collections Index — constituting some of the largest NFT collections, such as CryptoPunks, Bored Ape Yacht Club, Azuki and DeGods — is down 37% year-to-date, a period in which ether has appreciated 37%.

Solana, another blockchain popular for minting and trading NFTs, hasn’t fared much better, with daily trading volumes on Solana-based NFT marketplaces falling below $1 million for the first time since September 2021.

Worrying times for the NFT sector

On Monday, the Securities and Exchange Commission brought its first NFT enforcement action in a case against the podcast studio Impact Theory.

In a further sign of distress in the sector, NFT platform Recur announced it was shutting down last week, less than two years after raising $50 million in Series A funding round. Rarible also said it would cease aggregating NFT orders from OpenSea, LooksRare and X2Y2 amid the ongoing royalty debate in the crypto niche as more platforms stop enforcing creator royalties. NFT royalties also recently hit the lowest volume in two years.

However, one segment that could breathe new life into NFTs is gaming, according to Loopify, the pseudonym behind metaverse and NFT studio Endless Clouds. The market needs to shift from being dominated by profile pictures to NFTs that represent in-game items like "skins," he said earlier this month.