A recent survey coming from NFT Evening suggests that the NFT market is facing severe recession with more than 96% of the NFTs considered “dead.” In the last four years, the NFT market has experienced both boom and bust cycles, and now faces a period of major instability.
NFT Holders Facing Major Losses
NFT Evening conducted a comprehensive analysis of 5,000 NFT collections and more than 5 million transactions. The report suggests that profitability has been on a significant decline.
Further, it mentions that 43% holders are currently unprofitable, reflecting the market’s volatile nature. On average these investors have been facing losses to the tune of 44.5% on their investments in this area.
This underscores the major risks and unpredictable dynamics associated with the market. The study also reveals that the lifespan of an NFT is 1.14 years which makes them 2.5 times shorter-lived than traditional crypto projects.
Moreover, 2023 witnessed the largest number of NFT deaths with nearly one-third becoming inactive during that period. The report noted,
“This short lifespan reflects the intense speculative nature of NFTs, where rapid price fluctuations and the novelty of digital assets fail to sustain long-term value.”
Amid high unprofitability rate among holders, the significant disparity between successful and failing collections and their short lifespan, the market may not be as lucrative anymore.
Can Justin Sun’s Tron Come to the Rescue
Just when uncertainty and recession hit, Tron founder Justin Sun is providing some hope with the promise of reviving the NFT market on the Tron blockchain.
Sun believes that this could be the right time to launch high quality projects thereby gauging the interest of both collectors and enthusiasts. Although the Tron founder hasn’t disclosed specific details of the TRON NFT project, he stated that it would tackle some of the limitations of the current platforms, including high transaction fees, scalability issues, and subpar user experience.
This initiative from Tron could significantly impact the market, attracting new investors and fostering further growth for the platform. Furthermore the launch of a native NFT project would align with TRON’s broader strategy of diversifying its product offerings and user base.
