NFT Report November 2022

Despite the November crash in token prices due to macro conditions and the collapse FTX, NFT continued to fall steadily in November. 

Although overall trading activity declined, investment rounds increased, and blue-chip collections saw more trading. 

Overall Market 

• The NFT sector’s total market cap fell 6.3% to $553.1B from $590.9B.

• Activity in the NFT industry is declining across all metrics. The total NFT transaction volume decreased from 297.5B a 242.4B.

• The number of NFT owners increased from 16.7M to 21.6M at November’s end, but buyers and sellers were stable.

• In November, the buyer-to-seller ratio grew to 0.94 (91 buyers per 100 sellers).

• Last June saw more sellers than buyers, with 487,064 buyers and 485,095 seller.

• Volume in NFT marketplaces fell 26% MoM.

Financing & Investment

• The NFT funding round count increased from 9-11 to 11, while the total number of rounds for the blockchain space fell 8.4% MoM (from 65 to 71).

• Almost all rounds in November were relatively small seed rounds—all were under $10M

• Two of November’s largest rounds, including the largest, went to NFT marketplace projects. Joepegs an NFT marketplace on the Avalanche blockchain, raised $5M million led by FTX Ventures—money the project founders claim has been transferred out of FTX since the collapse—and the Avalanche Foundation. Courtyard closed the month’s largest round of $7M and hopes to let people monetize their real-life collectibles by turning them into digital assets.

Marketplaces & Chains

• According to Footprint’s wash trading detection, wash trading plays a much smaller role in the NFT market than it used to, likely due to the decreased profitability of the overall NFT sector.

• The filter discovered that wash trading accounted for only 37% of all major marketplace volume in November.

• NFT transactions still overwhelmingly involve Ethereum, with Solana coming in close behind and Polygon third.

View All Collections

• CyptoPunks and Blue Chip NFT collection BAYC saw significant increases in trading in November

• Transactions in BAYC NFTs almost doubled MoM, from 232 in Oct to 441 November

• CryptoPunks NFT transactions increased by 150 to 203

NFT Market Overview

In November, volume in NFT decreased alongside transactions and market capital. Despite fluctuations, data shows that the market cap remains stable at $600B to $500B. 

NFT Market Cap & Volume (Nov. Report)

It is used to determine the market demand and supply, which in turn influences the price. The ratio has returned to the high 0.80s since November. The ratio favoring buyers drove down NFT prices in summer. However, it began to rebalance in September, and then continued to rise in October. 

Buyers/Sellers Ratio November Report

Investment & Fundraising

While there was a decrease in fundraising rounds for the blockchain industry, November saw more than October. The NFT sector had 11 smaller (sub-$10M) rounds, mostly seed-stage rounds. 

Investment by category (Nov. NFT report)

In light of the seemingly grim conditions, it’s useful to compare these figures to the broader market, where investment rounds Also plunged YoY according to research from S&P Global, But to a lesser degree. Macro conditions clearly affected the crypto market earlier and more severely than expected. The research above might have used different tools to track investment round than Footprint Analytics. However, it was interesting to see that blockchain accounted roughly 5% for global VC funding rounds (which is what the report puts at 1,289) when we compare data side by side. 

Marketplaces & Chains

Wash trading is fraud where trades are made to artificially increase the activity in a collection, marketplace or to reap the trading reward incentives. 

Wash trading has become less popular in the NFT space due to decreased profitability. In other words, tokens like $LOOKS simply don’t hold their value like they used to and there aren’t enough real buyers to justify the effort of wash trading. Wash trading may still account for 30-40% of total market volume. 

In this order, the top three NFT transaction chains are Ethereum and Solana. 

NFT Tnx Chain

Collections

Dreadfulz and MineablePunks were the top three collections in November by volume. Bored Ape Yacht club was third. Dreadfulz was a popular place for wash trading in the past. However, data are not available about MineablePunks. 

Top 10 Collections based on Volume (November Report).

Blue chip collections activity was an anomaly in November. It jumped significantly. This was especially true for BAYC where trading nearly doubled.

NFT Transactions in BAYC (Nov. Report).

Many publications noticed this and have published it. AmberCrypto A Dec. 5 article entitled, was even published BAYC overcomes ‘dooms-month’ November but can APE decline to follow, This is how it began: 

“BAYC recorded a massive surge in its November performance, disregarding the crypto market crash.”

These articles overlook the fact activity can include both buying and trading. In turbulent times, a large increase in activity can signal a selloff. 

This piece was written by Footprint Analytics community.

The Footprint Community is where crypto and data enthusiasts from all over the world can come together to share their knowledge and insights on Web3, DeFi, GameFi and other areas of the emerging blockchain technology. Here you’ll find active, diverse voices supporting each other and driving the community forward.

 

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Data Source: November 2022 NFT report (ENG)