Royalties, platform fees and advanced trading tools: we thought these would be the deciding factors in determining the winner of the battle for non-fungible tokens traders, and their sweet, sweet liquidity. What we didn’t see coming was brand new protocols and tech that would steal those same traders away, and pull their attention away from NFTs.
Social finance (SoFi) platforms like Friend.tech, Stars Arena and New Bitcoin City are trying their best to take traders to the cutting edge of finance and technology. Make no mistake, while these young platforms look and feel like a beta today, they just may end up reshaping the future of social media.
Wash trading has drastically fallen over the year since its 2023 high of US$1.4 billion in February. As the Blur marketplace’s $BLUR token price declined, and opportunities to earn the platform’s points increased, traders began looking elsewhere for rewards on the blockchain.
Friend.tech was primed to win over these traders when it launched on August 10, giving users shared fees each time traders bought and sold access keys to chat with them. The platform is also promising future rewards early next year in the form of $ETH. This was all NFT degens needed to hear to dive in. Wash trading has fallen 68.6% since the first full week of Friend.tech’s life, from US$53.9 million to a 44-week low of US$16.9 million two weeks ago.
Blur is now attempting to attract traders back with an announcement of the end date for Season 2 farming on Nov. 20. More importantly, a proposal was submitted to the Blur Foundation from one of their investors, suggesting a 1% fee addition to all trades on blur.io.
Fees may sound counterproductive, but the ultimate goal will be to buy $BLUR with those earnings and burn the token. As the supply decreases, this should drive up the price of $BLUR. That is, if traders haven’t already felt burned themselves, and decided to leave for better opportunities.
Initial reaction to the proposal was positive, leading to a drastic 85% increase in wash trading last week, and over US$31.3 million in wash sales volume. Wash transactions saw a similar increase from 28,208 in the first week of October, climbing 75% to 132,281 last week.
Blur has more competition than just the new SoFi platforms to contend with now. A new disruptive marketplace called Flooring Protocol is making a serious run on farmers with their fractionalized NFTs. Just Monday, Flooring Protocol saw over 489 ETH (US$767,000) traded in and out of fractionalized Azuki Elementals, y00ts, and Pudgy Penguins NFTs. While these are fungible tokens being traded, and not NFTs, they offer traders a new way to get liquidity, and collectors a chance for exposure to some of the world’s most expensive NFTs for just pennies.
For now, the ship full of traders may have already sailed past Blur and OpenSea, as SoFi and fractionalized assets look to become the new meta. That doesn’t mean it won’t come back around again, though. Remember, even though the market is ever-evolving, there are some constants you can count on. Degens just want action, and they want gains. Ultimately they don’t care where they get them from.
Peep the charts
- DMarket again dominates the top collection rankings on CryptoSlam with US$8.9 million in sales, while new NFT mints climbed 21%, and trade profits rose 9% to US$308,177 on the week.
- Gods Unchained saw US$4.3 million in sales as players’ excitement ramps up for the long-awaited Season 2 gameplay.
- Winds of Yawanawa by Refik Anadol has seen its average sales prices climb to as high as US$20,000 Monday, following the full reveal of the collection’s art last week. The Museum of Modern Art welcomed Refik’s Unsupervised Machine Learning NFT into their permanent collection as well, becoming their first ever NFT.
- Pudgy Penguins have a major new investor, Spencer Ventures bought 48 Pudgy Penguins last week from a Sotheby’s sale of prior 3AC assets.
- Ethereum NFTs saw a 67% increase in wash sales in the past seven days, driven by positive sentiment around a proposal for a 1% marketplace fee that will ultimately burn $BLUR tokens.
- Mythos Chain again is seeing 99% of its sales volume come from CounterStrike skins on the DMarket marketplace.
- Solana got a bump from its top collection, a new project called KING Royal which saw US$604,000 in sales volume.