NFT trading has sharply declined since December 2024, while AI-powered dApps have emerged as the fastest-growing sector in Web3.
According to DappRadar’s Industry Report, NFT trading volume has declined by 63% over the past two months, dropping from $1.36 billion in December to $997 million in January and further down to $498 million in February. Sales also fell by 16% last month, underscoring the ongoing market slowdown.
Despite the broader decline, some NFT collections have remained active. Pudgy Penguins recorded a 25% increase in sales even as prices dropped, while Doodles gained attention with the announcement of its upcoming Solana-based DOOD cryptocurrency. Meanwhile, AI-powered NFT collections like Kaito Genesis have gained traction, with its floor price climbing to 7.65 ETH following a partnership with Azuki.
Meanwhile, AI dApps have surged in adoption. Platforms like LOL reported a 40% increase, reaching 5.1 million users, while Evermoon saw an explosive 988% growth. AI-generated content has also gained momentum, with Fractal Visions recording a 721% surge in adoption.
Similar to NFTs, DeFi sector has also experienced a downturn. Total value locked (TVL) in the sector fell from $217 billion in January to $168 billion in February, largely due to a drop in liquid staking activity. Ethereum’s TVL dropped 27% to $97 billion, while Solana suffered the steepest decline, with TVL shrinking 33% to $15.4 billion due to lower activity on Raydium and Jupiter.
However, Berachain managed to defy the broader market downturn, securing $5.05 billion in TVL. Aptos was also among the few chains to register growth, with its TVL rising by 6% to $1.83 billion.
This decline contrasts sharply with the resurgence seen in November last year, when NFT trading volume surged over 20%, reaching $698 million. At the time, Analyst Sara Gherghelas attributed the rebound to rising token prices, improved liquidity, and increased engagement with blue-chip collections like those from Yuga Labs. However, even as trading volume climbed, sales volume fell by 11% to 3 million units, indicating a shift toward higher-value transactions rather than broader market participation.
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