Non-fungible tokens (NFT) buyers have made a comeback into the market in June after a poor showing through the month of May, however, trade volumes across major Ether-based marketplaces show a considerable dip yet again, as per business analytics service Nansen. The Nansen NFT Indexes Report for the second quarter of 2022 points towards a series of free minting events, also called AirDrops in the crypto world, as a reason for the increased activity through June although blockchain gaming continues to be worst hit among indexed marketplaces.
Nansen’s Q2 NFT Report found that monthly returning buyers of NFTs on the Ethereum blockchain bounced back to 45,000 in June after seeing less than 35,000 in May. The company reviewed six indexes of NFT collections of NFTs denominated in ETH that are representative of trends in the market.
The six gauges – NFT-500, Blue Chip-10, Social-100, Game-50, Art-20 and Metaverse-20 – saw significant decreases in Q2 from the first three months of 2022. Nansen’s Gaming index fell the most, 59.6 percent from the beginning of the year.
“One such reason is that ETH inflows and circulations are concentrated in Blue Chip or large-cap NFTs within the NFT market,” says Louisa Choe, research analyst at Nansen. “Such a phenomenon hints at the risk-off attitude among NFT market participants.”
This cautious sentiment points to investors focusing on capital preservation rather than taking risks in hopes of gains. Interestingly, although June numbers point towards a change in trajectory, the report points to limited liquidity in the NFT market as a sign that the uptrend may not sustain.
It is important to note that the Nansen report only tracked NFT collections based on the Ethereum blockchain. While Ethereum-based NFTs accounted for 82.2 percent of the NFT volume traded in June, NFT collections also exist within Solana, Polygon, and other Ethereum blockchain alternatives.
In fact, DappRadar’s Q2 game Report reveals that games based on blockchains other than Ethereum experienced rapid growth despite unfavorable market conditions. Sunflower Lands on Polygon had its UAW increased by 10,000 percent to over 11,000 users, and Gameta on Solana ended the quarter with more than 30,000 unique active wallets (UAW), DappRadar noted.