This week's market movements test the intent of NFT traders - What's next?

This week’s market movements test the intent of NFT traders – What’s next? – Mail Bonus

There is no doubt that there has been an influx of excited investors to pile up in Web3 and that is despite the contraction in total sales over the last seven days. From the beginning of May, the total market value for rigid tokens (NFTs) rose to over 19.4 billion dollars and the total volume exceeded 1.2 billion dollars in the last seven days.

7 days NFT market value / volume. Source: NFTgo.io

Despite the fact that the amount is less than usual, the audience is quick to wonder whether the projects that are launched yield usable products based on the amount of liquidity that is pumped into them. Although this is not always the case, NFT investors are evaluating the roads, announcements and plans shared by the team. However, given the speed at which the emerging NFT sector is moving, detours and roadblocks can be expected when investing in NFTs.

Interesting projects and the blue-chip status of NFT such as Cool Cats’ Cool Pets, Axie Infinity and even the Bored Ape Yacht Club (BAYC) have deviated slightly from their planned plans and slightly reduced the enthusiasm of their users. While this has clearly worked well for BAYC, it is important for investors to understand that investing capital in a pledge of a roadmap could ultimately lead to disappointment.

Unpredictability of growing pains

It’s exciting to come across a project that seems to be blue caliber. The project could tick all the boxes and the team has proven to have previously developed an active product, the art sounds to diverse groups of people. If the community is strong and gathers its conviction towards the project and it is supported by a desirable roadmap, then investors consider themselves convinced that they have landed a winner.

Of course, all this is no guarantee of success.

Take, for example, Cool Pets, which launched on January 31st and was set to launch a playable (P2E) market, Cooltopia. Several technical shocks delayed the installation and led to many NFT traders losing faith in the project. In addition, on April 29, Chris Hassett, former CEO of Cool Cats NFT, resigned and the company is now looking for a replacement.

There are often unforeseen events that can create a transfer problem as much as possible in the success of projects, but it is important to keep in mind the difference between “good” and “bad” problems. For example, accelerating growth can create stress in a project’s ability to scale safely, but often sets goals.

Axie Infinity was not immune to socially designed hacking that led to a $ 625 million hack that represents one of the biggest cryptocurrencies in history.

As it stands, the Ronin bridge that carries money to Ethereum mainnet is closed. This means that users’ funds are currently locked on the Ronin network until a full review is completed. This unpredictable event has led to investors having their capital locked up and their signs in the game in a sharp downturn. In light of this, the social media has seen its most difficult days as investors have expressed their views on how to proceed.

Market fluctuations can affect morale

Accelerating growth can not only set goals for a project, but it can also lead to too many chefs in the kitchen experimenting with new ideas. Often, as the user base of a project grows, the number of views on what is best for the future and the sustainability of the community and the project increases. This is where speculation begins to brew and expectations begin to form.

The Otherdeed digital land NFT from Yuga Labs went down the most expected currency for 2022 so far, with speculation of $ 110,880. Most of these values ​​were attributed to the rare Koda NFT, which was distributed randomly to Otherdeed countries.

Since the currency was originally priced in ApeCoin, a secondary market, OpenSea supported APE as a payment method for future listings. The Otherdeeds sold for an average of $ 25,629 for veal but dropped to $ 15,510 after publication, along with a drop in APE prices.

Other average all time sale price / quantity. Source: OpenSea

Although many Web3 investors expected this currency to blow others away, they did not expect the entire cryptocurrency and NFT markets to go down. In the last seven days, Ethereum has fallen by 15% and since most NFTs are based on Ethereum, their prices have also taken a hit. The Nana’s Solana (SOL) base has also been hit hard, with SOL falling by almost 40% in the last seven days.

NFT traders also expected that the currency would strengthen the NFT market with liquidity. Although liquid assets have been pumped into certain museums, NFT’s total sales volume has fallen by 40% in the last seven days. These figures suggest that the market may be entering a cooling-off period.

30 days NFT market value / volume. Source: NFTgo.io

As a large part of the market appears in the red, NFT investors are facing difficult problems. Some investors expanded their indebtedness far more than they could afford and were forced to sell their assets at a loss to cover margins and liquidations. Others are optimizing negative deficits for retail investors panic due to US interest rate hikes.

The WAGMI “we will all get it” mantra that became popular with NFT investors is being tested and traders have to deal with market fluctuations that are not adorned with historical highs and spectacular volumes. On the positive side, builders are often born in these depressions. Experienced investors use expected market declines to “stack and survive“, By adding to their portfolios and cycling the current lows back to new historic highs.