NFTs Outpaced Ether's Gains in January

Ether prices are set to close the month just over 2% higher, while major NFT indexes have advanced almost 10%.

AccessTimeIconJan 31, 2024 at 8:47 a.m. UTC
Updated Mar 8, 2024 at 8:44 p.m. UTC
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Indexes tracking the prices of non-fungible tokens (NFTs) have risen almost 10% this month, outpacing ether (ETH), the cryptocurrency many are denominated in, which has gained just over 2%.


Nansen's NFT-500 index, which tracks the 500 most valuable NFTs, has added 9.35% year-to-date, while the Blue Chip 10 is up a similar amount. Ether, according to CoinDesk Indicies data, advanced 2.2%.

In an interview with CoinDesk at Taiwan Blockchain Week, Animoca Brands founder Yat Siu pointed to the newfound maturity and diversity of the NFT space as a reason why prices have recovered from their 2022-2023 crypto winter lows.

"The majority of the speculators in the NFT and GameFi space have left, which strengthened the foundation as the remaining people are genuinely interested," he said.

January's gains are unique because NFT prices in ether initially did not keep up with the cryptocurrency's year-end advance. Traders, however, seem to have changed their minds as the hunt for utility, or real-world uses, is on.

The rally comes even as the average price of an NFT has dropped 13% to $107, according to data from CryptoSlam. The number of transactions has risen 30% while sales volume is down 36% to $1.1 billion for the month. Wash trading, a form of market manipulation in which a buyer and seller collude to give the appearance of demand, accounts for 39% of all volume, according to CryptoSlam data.

Some NFT-adjacent crypto sectors aren't doing so well.

The CoinDesk CoinDesk Culture & Entertainment Select Index (CNES), which includes metaverse tokens Axie Infinity, The Sandbox, and Decentraland, fell 22%.

Edited by Sheldon Reback.


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