By Paul Hoffman of Best Brokers
A looming Fed rate hike was the hot topic in early 2022. Shortly after that global markets plunged deeper into the red with the start of a war between Russia and Ukraine. It wasn’t long before the LUNA crash followed and the crypto market plunged deeply.
Unfavorable events for the global economy continue and cause further damage to all crypto assets. Despite all the negative things around crypto and some published analysis, ending with the announcement of “crypto winter”, the NFT sector continues to develop at a good pace and our team at Best Brokers decided to pull some raw data from the Blockchain with Dune Analytics and provide a visual representation.
For report Dune Analytics is used to run raw queries and analyze raw data from the blockchain. It also features a year and quarter based breakdown of unique Ethereum NFT traders and the number of Ethereum NFT traders as well as expert opinion on overall NFT trading activity.
Unique number NFT traders are active on the Ethereum blockchain up to over 2.07 million in 2022. Despite negative conditions in 2022, the number of active NFT traders on the Ethereum network jumped by 276% compared to 2021.
Initially trading numbers plunged 22.48% in the fourth quarter of 2022 but bounced back nicely in the first quarter of 2023, which makes the year look promising.
Despite reduced prices and significantly lower trading volumes for most cryptocurrencies, the number of unique NFT traders active on the Ethereum blockchain rose to over 2.07 million in 2022 or 276% compared to 2021.
“The fact that NFTs caught the attention of traders during difficult times for the entire investment world means that there is something special about these assets. With the price of crypto expected to only increase from here on out, NFTs will become more mainstream and will eventually bring in a lot of young investors to the market.”
Stable trading activity overall
Ethereum NFT trading activity initially rocketed to nearly 3 million trades for the third quarter of 2021 with BTC and Ethereum hitting all-time highs. However, this trend has remained steady despite a turbulent 2022, only dipping in the fourth quarter of 2022 when Fed rates hit (and exceeded) the 4% mark for the first time in 15 years.
Even after the number of trades fell 22.48% in the fourth quarter of 2022, it still bounced back in the first quarter of 2023 with the number of trades in the current first quarter already 6.65% higher as of March 15, 2023.
“Such steady activity, even though the crypto and global market is experiencing one of the most volatile years in its history, only strengthens hopes that NFTs will become one of the most popular trading instruments in the future. We’ve seen the strength of retail investors in so-called ‘meme stock’ rallies in the past year, now we’re seeing it in trading NFTs.”
– comments Alang Goldberg, analyst at BestBrokers.