04 Jan 2023
NFT Indicators that Could Bring a Bullish 2023
Several factors may contribute to a bullish trend in the NFT market in 2023. This article will explore three market indicators that could potentially bring a bull run for NFTs in 2023.
Number of Daily NFT Transfers on Ethereum
- January 2021: 19,750
- January 2022: 406,858 (1,959% yearly increase)
- January 2023: 668,542 (64% yearly increase)
The increasing number of NFT transfers remained healthy despite the crash of other crypto sectors. This indicates that NFT investors have remained active, even during the crypto bear market. The continued activity is likely linked to the nature of NFTs, which offer ownership and scarcity of digital assets such as art, collectibles, and even virtual real estate assets (usually less volatile than cryptocurrencies). Furthermore, as more people become aware of NFTs and their potential value, greater demand for them may lead to a more stable market in the upcoming years.
Total Number of Wallets Holding an NFT:
One key factor that points to the NFT market being on the rise is the increasing number of wallets that own at least one NFT. This trend has been steadily growing since 2017, and we've seen it rise yearly. As a result, the total number of wallets holding an NFT has reached an all-time high of 7.3 million in 2023. This is a clear sign that more and more people are becoming interested in and investing in NFTs. It's a positive development for the market, and we'll likely continue to see this growth trend.
- January 2017: 217
- January 2018: 417
- January 2019: 80K
- January 2020: 420K
- January 2021: 787K
- January 2022: 2.9M
- January 2023: 7.3M
The Average Price of an NFT (in USD):
Regarding monetary value, the NFT market has been directly affected by the depreciation of cryptocurrencies since March 2022. In other words, the monetary value linked to USD is significantly lower for most NFT collections. For example, the average price (in USD value) of an NFT in January 2021 was $1,500. In January 2022, the price was $2,150. In January 2023, the current average price of an NFT is only $250.
- 2021: $1,500
- 2022: $2,149
- 2023: $250
The current state of the NFT market, which is closely tied to the value of Ethereum and the US dollar, may be influenced by the overall performance of the cryptocurrency market and the state of the global economy. The crypto market in January 2023 has reached its lowest point since January 2021, affecting most NFT collections' value. However, it is crucial to consider that the challenges facing the NFT market may not be due to any inherent issues with NFTs but rather the broader circumstances in the current global economy.
Conclusion
Even during the NFT market, we keep seeing an increasing number of wallets that own an NFT, and the total number of transferred NFTs remains healthy. The missing part of the puzzle is the appreciation of cryptocurrencies and the practical uses of NFTs that will bring the technology to mass adoption. The increasing number of wallets holding NFTs is a bullish indicator for the NFT market because it suggests a growing demand for these assets, which could potentially drive their value up in the future.
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