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As per data from IntoTheBlock, looking at the trading volume of NFTs, we can notice some stagnation since July. The level of activity in trading is essentially static, so the data raises the question of whether it is gearing up for a rebound or this is its new normal.
NFT trading volumes have remained relatively flat since July.
— IntoTheBlock (@intotheblock) October 10, 2024
Will there be a resurgence? Or is the market settling into a new normal? pic.twitter.com/Hm47TcrqO5
Market Overview: From Peaks to Flatlines
According to IntoTheBlock, NFT trading has experienced a sharp fluctuating pattern towards the end of 2023. Further, into mid- and early 2024, trading volumes increased severally in March. Since July, however, the market has shown a clear sign of flattening. As the chart shows, while there are occasional fluctuations in the daily trading volume, the rate has remained somewhat constant in the recent quarter for the NFTs market.
The total volume line is almost horizontal; it depicts active trading volumes in the $0-$20M range, far from their previous highs. This relative calm is a cause for concern regarding the general development of the NFT market.
A Temporary Pause or a New Normal?
This might be viewed in more ways than one. Firstly, it could be due to the cyclical market behavior characteristic of a developed industry, with phases of high volatility succeeded by phases of stability. In the first half of 2024, there was hype for NFTs because of innovation and new use cases, but now it no longer looks like that.
On the other hand, such stability could also be because the market has attained a new level of maturity. This change might also point to the non-fungible token market becoming more sophisticated, with institutional participants and real money investors dominating it.
Future Outlook: What’s Next for NFTs?
The NFT market is still highly speculative, but the flattening trend might signify a more sustainable market in the future. There will be less speculative trading, and NFTs might be used beyond art and collectibles, such as gaming, real estate, or DeFi.
Lastly, whether this stagnation is temporary or a reversion to a new normal depends on the non-fungible token’s performance for the next few months.