Guest post by Mason Nystrom, Messari Senior Research Analyst
Data is just a story waiting to be told.
One aspect about data that I love is that it can tell stories of the past, the present, and opens the mind to the potential stories of the future.
Let’s start with the past.
The Past: Context For the Present
While non-fungible tokens have existed for a long time, the market for such tokens was historically small. Early marketplaces like OpenSea and SuperRare, which were founded in 2017, grinded through a market that was mostly dominated by Ethereum until blockchains like WAX and Flow finally launched offering application-specific chains for gaming and consumer applications. In 2020, OpenSea was averaging $1 million in sales per month and the tailend of the first Covid-19 year experienced growth (now considered a kindling fire) in NFT art and collectibles sales.
December of 2020 witnessed some uptick NFT chatter with the growing excitement of NBA Top Shots and early Ethereum card games like Axie Infinity and Sorare.
What comes next, you may already know, but let’s break it down by the data anyway.
The Past: 2021
The first NFT narrative to explode at the beginning of the year (as a continuation of 2020) was sports NFTs, specifically NBA Top Shot.
Combining financial incentives with sports is a tried and true recipe and cryptonetworks with tokenized digital goods are the natural steroids for which the industry will use to reach new heights.
In tandem with the breakout of sports NFTs, 2021 will go down perhaps most significantly as the year of the digital renaissance. As the mainstream media watched the birth of new business models and monetization strategies, platforms like Nifty Gateway and SuperRare dominated, offering artists a new format for monetizing their work.
NFT royalties are easily a 10x improvement from the legacy artist monetization system and nearly every artist’s endeavor is examining how to issue NFTs. The joy of digital painting continues into the summer as new platforms like Art Blocks and Foundation onboard new artists and collectors.
The NFT summer moment largely becomes overshadowed with the continued growth of pfp/avatar projects and Axie Infinity’s Ronin launch, which immediately experiences rapid growth in users and NFT secondary sales.
The final leg of our saga gets told through the lens of Solana. With Ethereum experiencing heightened gas prices, pfp creation and flipping, in part, moves to Solana which quickly marches towards surpassing Flow in Cumulative NFT volume.
In hindsight, August of 2021 was the peak with over $4.5 billion in NFT secondary sales, likely more when factoring in art sales and non Cryptoslam tracked NFTs (e.g digital land).
The present has a funny way of misshaping our view of the past. Although the past few months still lagged compared to the peak, it’s worthwhile to realize that the NFT secondary market is…
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