NFTs based on Ethereum were right in the spotlight of 2021’s biggest sales and grabbed the attention of many industries that are now diving into the world of smart contracts to find large profits. Last year, Ethereum smart contracts linked to NFT marketplaces and collections saw an influx of around $20 billion, and the pace has not slowed down in 2022.
Non-fungible tokens give proof of the ownership of many unique digital items like art pieces, collectible cards, avatars’ clothes inside videogames, and more. The process of creating these certified tokens is called “minting”, which essentially uses the blockchain to turn a digital file into a digital asset.
Similarly, smart contracts are what powers NFTs. Simply put, they are the code and data behind the transferability and proof of ownership.
Currently, the Ethereum blockchain hosts some of the largest NFT marketplaces like OpenSea, Rarible, and Mintable.
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How Big Can NFTs Get This Year
Some analysts and experts had claimed that non-fungible tokens would need to show a functional side this year in order for the market to not lose its popularity. This approach has just started to be taken by many platforms racing to offer NFT-backed loans. The Ethereum website explains this service like so:
There are DeFi applications that let you borrow money by using collateral. For example you collateralise 10 ETH so you can borrow 5000 DAI (a stablecoin). This guarantees that the lender gets paid back – if the borrower doesn’t pay back the DAI, the collateral is sent to the lender.
However, without seeing much growth on the functional side of NFTs yet, the market is doing more than well.
A recent report by Arcane Research shows that OpenSea still sits on the throne of all NFT marketplaces by a large margin.
In 2022 alone, the NFT activity of OpenSea has traded around $2 billion worth of Ethereum. January 9th became the third most profitable trading day for the NFT marketplace so far, having recorded ETH worth over $261 million.
The two best trading days to date remain August 29th, 2021, with $323 million, and August 30th, 2021, with $267.5 million. In all 2021, the total NFTs sales volume reached $24.9 billion.
The following chart shows this month’s surge in the ethereum NFT marketplaces competing with August 2021 for the best trading month to date title:
The Arcane report suggests that the mania of the Yuga Labs projects Bored Ape Yacht Club (BAYC) and Mutant Ape Yacht Club (MAYC) is behind this surge. BAYC just added $50 million in seven-day trading volume and MAYC added $50 million.
Furthermore, last week The Doodles and PhantaBear collection also saw a dramatic rise of 108% and 450%, adding over $56 million and $50 million respectively.