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NFTs Are Dead? Solana Outpaces Ethereum for NFT Sales

Last Updated December 11, 2023 4:05 PM
Josh Adams
Last Updated December 11, 2023 4:05 PM
Key Takeaways
  • Solana has been a big beneficiary of the wider crypto resurgence recently.
  • Prices have boomed since the middle of October across most high-profile digital assets.
  • Now that Solana success looks to be translating into more NFT sales.

In a dramatic twist, the Solana (SOL) network briefly surpassed Ethereum (ETH) in total non-fungible token (NFT) sales volume on Friday, marking a notable, if temporary, shift in the market. 

For seasoned crypto veterans, Ethereum dominating the NFT space seemed an immutable law of the industry. Yet Solana’s surprise performance raises questions about Ethereum’s place as the dominant smart contract and NFT platform.

A Good Week for Solana NFTs

Sparked by skyrocketing sales from the “Tensorians” NFT collection, Solana saw trading activity that catapulted it past Ethereum for the first time since June. Coming on the heels of Solana’s 75% increase  in total value locked in DeFi protocols last month, this achievement signals a network whose comeback is outperforming the wider crypto industry.

And Solana isn’t alone in this revival. The entire NFT industry appears poised for growth following the tremors that rocked the crypto world last year. According to DappRadar’s November report, monthly NFT trading volumes just hit $994 million globally – a 125% surge from October. Driving this boom are Solana-based collections like Tensorians, BONKz and Mad Lads. As well as a significant uptick in Bitcoin Ordinals – BRC-20 tokens on the Bitcoin (BTC) blockchain.

But while the sales headlines are grabbing attention, data from DappRadar  reveals a behavioral shift rumbling through the NFT market: increased buying, but at higher prices. The average transaction value recently doubled, suggesting traders feel buoyant bidding up works rather than chasing quantity.

However, the NFT market is highly dependent on the health of digital assets elsewhere. Bitcoin, the original cryptocurrency, is up approximately 56% since the middle of October, when the latest market rally began. SOL meanwhile, has pumped 209% in the same time. So, perhaps its no wonder Solana NFTs are having their moment in the sun.

DappRadar shows how trading volume spiked in November.
Source: DappRadar.

A Big Change from Pear Bear and Peak Bull Market

This flowering of NFT trade stands in stark contrast to the crypto winter of 2022 that left traders out in the cold. NFT sales hit a peak in January last year before crypto markets nosedived, triggering widespread panic in the long-term viability of non-fungible tokens.

Weekly NFT volume, according to Dune.
Source: Dune/Hildobby

But while the market is seeing a resurgence, it is in no way comparable to the halcyon days of 2021 and early 2022, when the price of non-fungible tokens commanded news attention outside the crypto space. In January 2022, the NFT market totaled a record-breaking $16 billion in sales, although 60% of it originated from artificial trading on LooksRare, according to DappRadar .

Since the cooling-off, NFTs have largely lost their luster. Celebrities like Madonna and Justin Bieber, who once proudly wore their blue chip Bored Apes, now have little to say about the phenomenon, partly because of an ongoing legal case . By-and-large, NFT trading and collecting is still a very niche pursuit.

Things could still change, however. 2023 has seen the crypto market make something of a resurgence. Optimists believe 2024 could do the same for NFTs. 

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