NFT Market Sees Worst Performance Since 2020, DappRadar Reports

The non-fungible token (NFT) market experienced a challenging year in 2024, recording its worst performance since 2020, according to a recent report by blockchain analytics platform DappRadar. The downturn was marked by a significant decline in both trading volumes and sales, with the market grappling with volatility and rising token prices.
Decline in Trading Volume and Sales
DappRadar’s 2024 Dapp Industry Report, published on January 14, reveals that NFT trading volumes fell by 19% year-over-year, dropping to $13.7 billion. Meanwhile, sales counts saw an 18% decrease, totaling just under 50 million transactions. This decline marks 2024 as one of the most underperforming years for NFTs since their explosive rise in 2021.
Despite a promising start to the year, NFT trading volumes showed considerable volatility. In the first quarter of 2024, trading volumes rose by 4% to $5.3 billion compared to Q1 2023. However, this momentum proved short-lived, with volumes plummeting to $1.5 billion in Q3 before rebounding to $2.6 billion in Q4.
Sales counts also dropped compared to 2023, a trend attributed to the rising prices of NFTs, particularly those priced in Ether (ETH). The shift suggests that while NFTs remained in demand, they became more expensive, leading to fewer transactions.
Struggling to Regain Momentum
The NFT market has struggled to regain its previous momentum, even as the broader cryptocurrency market, led by Bitcoin (BTC), saw a significant resurgence. Bitcoin’s impressive 125% gain in 2024 contrasts sharply with the NFT market’s performance.
The NFT sector had its best year in 2022, when it reached an all-time high with $57.2 billion in trading volumes and 121.7 million sales. However, the market has since seen a downturn, with 2024 falling far short of those peak numbers.
Gaming NFTs Dominate
Despite the overall decline, DappRadar noted that gaming-related NFTs still dominated the market, particularly in terms of sales count. Epic Games' trading card game Gods Unchained topped the gaming NFT category with $152 million in sales, although this represented a 27% decline from the previous year. The game saw 3.86 million sales, an 18% drop from 2023.
However, not all NFT collections faced the same struggles. The Pudgy Penguins collection emerged as the top performer by trading volume, with sales increasing by over 140% from 2023 to $786 million. The collection also saw a 114% increase in its floor price, despite a 44% drop in sales count. Pudgy Penguins has expanded its brand beyond digital assets, launching plush toys in major retailers like Walmart in the US and Selfridges in the UK, as well as a mobile game and sports partnerships. This real-world utility appears to have helped boost its success, reinforcing the notion that NFTs with tangible use cases continue to perform well in the market.
Shifting Perspectives on NFTs
DappRadar’s report concluded with a broader reflection on the NFT market’s evolution. The data suggests that NFTs don’t need to be prohibitively expensive to hold value in the Web3 ecosystem. The year 2024 may have helped the industry realize that NFTs' true importance lies not in their price tags, but in their utility and role within the broader digital and physical worlds.
As the NFT market continues to navigate through volatility and uncertainty, it remains clear that utility-driven projects and those with real-world applications may prove more resilient in the face of market fluctuations. While 2024 may have been a tough year for NFTs, space remains ripe for innovation, with the potential for future growth as the industry matures.
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