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Once seen as a promising area for digital assets, the NFT sector is experiencing a noticeable decline.The floor price of the esteemed Bored Ape Yacht Club (BAYC) has tanked to its penultimate low in over 2 and 1/2 years.
The situation where the BAYC floor price decreased by more than 90% from the highest point reveals hints of how high-risk the digital art NFT market is.Furthermore, the future viability of this infant sector is also doubted.
Plummeting BAYC Floor Price
The Bored Ape Yacht Club (BAYC) NFTs, backed by Yuga Labs, are now available for just 11.1 Ether, the lowest price since August 2021.From its top floor price of 128 Ether, attained on May 1, 2022, this represents a noteworthy fall of more than 90%.
Adding to the concern, data from NFT Price Floor reveals that the BAYC floor price has halved since March 1, 2024, approaching a sub-10 NFT floor price.
It suggests that the current floor price matches four months after the project’s launch in April 2021, highlighting the rapid and sharp decline in the collection’s value.
The Broader NFT Market Downturn
The reduction in the price of digital art NFTs at BAYC is not an isolated event; instead, it is part of a broader industry-wide trend toward declining popularity.
The most extensive NFT collection by market capitalization, CryptoPunks, has also experienced a substantial decline, plunging 64% from its highest floor price of 113.9 Ether.
The Difficulties Digital Art NFTs Face
The NFT community is having a more comprehensive discussion regarding the sustainability of digital art projects due to the collapse of the BAYC floor pricing.
Commentators in the industry have stated that these NFTs were “never meant to exist on their own as projects” and that, in order to offer real value, the teams behind them should consider combining them with other blockchain-based verticals.
Shi Khai Wei, a founder at LongHash Ventures, explained that “it is tough to raise things without a clear vision of the brand and actual products behind it.”
This sentiment emphasizes the importance of NFT businesses going beyond selling digital art and creating strong ecosystems that give their tokens practical applications.
Rare BAYC NFTs Defying the Trend
A few extremely rare and sought-after NFTs from the collection have sold for much more than the floor price, even though the BAYC floor price has fallen.
For instance, last month’s astounding 504.3 Ether (or around $1.92 million) sold for BAYC #830, and in the previous few days, several other uncommon BAYC objects have sold for more than 30 Ether.
It suggests that while the broader digital art NFT market faces challenges, there is still demand for unique and valuable NFTs, particularly those with distinctive attributes or associated with established brands.
However, the question remains whether this trend can be sustained and whether it can drive a broader recovery in the NFT market.
The Path Forward for Digital Art NFTs
As the NFT industry grapples with the decline in digital art projects, industry commentators have suggested that the path forward may lie in integrating these NFTs with other blockchain-based verticals, such as in-game economies and infrastructure.
Shi Khai Wei from LongHash Ventures believes that “it is much easier if you already have a clear vision. Here’s the game, an infrastructure, a chain, a marketplace, and then you have your early adopter core community adopt [behind it].”
This approach, which focuses on building utility and real-world applications for NFTs, could be crucial in reigniting the interest and value of digital art projects.
Conclusion
The problems affecting the digital art NFT market are glaringly evident in the falling floor price of the Bored Ape Yacht Club NFTs.
It will be critical for NFT projects to establish clear goals, link their services with other blockchain-based verticals, and deliver real value to their users while the industry struggles with a broader slump. The NFT market will be able to recover its previous vigor and momentum later.
Although the road ahead may be challenging, there may be substantial benefits for those who can successfully negotiate this terrain.
Steefan George is a crypto and blockchain enthusiast, with a remarkable grasp on market and technology. Having a graduate degree in computer science and an MBA in BFSI, he is an excellent technology writer at The Coin Republic. He is passionate about getting a billion of the human population onto Web3. His principle is to write like “explaining to a 6-year old”, so that a layman can learn the potential of, and get benefitted from this revolutionary technology.
