October 2022 NFT Report

October was a relatively sleepy month for blockchain, with no enormous market swings, project launches or funding rounds. The NFT market continues to stagnate since the late summer as macro conditions remain tough. 

Starting from last month’s report, Footprint Analytics has begun incorporating and refining its wash trading filters and analysis. As the market has cooled off, there has been significantly less wash trading than at the height of the market, but it still remains a problem for accurately assessing the industry. 

Overall Market 

• The total market cap of the NFT sector increased 9.7% from $643B to $706B.
• However, the total number of NFT transactions had a sharp decline from 5.3M to 3.7M.
• The total number of NFT holders increased from 17.2M to 19.2M in October.
• The buyer-to-seller ratio increased in October, reaching 0.89 (89 buyers for every 100 sellers).
• The last time there were more buyers than sellers was in May, when there were 545,531 buyers and 514,442 sellers.
• Volume across NFT marketplaces declined by 24.9% MoM. 

Financing & Investment

• The number of funding rounds in the NFT space decreased by from 12 to 9, whereas the number of rounds in the blockchain space overall declined by 25% MoM (from 95 to 71)
• The majority of funding rounds were seed rounds.
• It becomes increasingly difficult to separate NFT projects from others and analyze the category in a clean vacuum, as Web3, GameFi and infrastructure increasingly converge with NFTs. For example, the top project by funding, Stardust, can be classified as both an NFT and a gaming project.

Marketplaces & Chains

• Wash trading continues to be an obstacle in assessing the NFT market. However, it is significantly lower than what it was at the height of the market in January to April.
• Ethereum still makes up the majority of NFT trading volume, but the total number of transactions are split nearly evenly with Solana.

Collections Overview

• Meebits, Terraforms by Mathcastles, and Dreadfulz were the three most highly traded collections by volume in October. Their suspected wash trading amounts were 94%, 98% and 89%, respectively. Note: These are percentages of total trade volume, not total trades.
• Blue Chip NFT collections BAYC and CyptoPunks saw almost no change in the amount of trading volume from September to October.

NFT Market Overview

In October, the amount of volume in the NFT sector decreased along with transactions, while the overall market cap increased. 

NFT Market Cap & Volume (Oct. Report)

The ratio of buyers to sellers continues to shift upwards. In summer, the ratio severely favoured buyers, driving down the prices of NFTs, but this began to re-balance in September and continued up in October. 

Buyers/Sellers Ratio October Report

Investment & Fundraising

The number of fundraising rounds in the blockchain industry contracted across all categories, with the number of NFT funding rounds now in the single digits. 

Investment by Category (Oct. NFT Report)

Marketplaces & Chains

At the beginning of 2022, wash trading was a major percentage of total NFT trading. It has since gone down. Chains other than Ethereum still face an uphill battle in gaining NFT projects and communities.

NFT Volume by Platform

NFT Volume by Platform (with Wash Trading Filtered)

Collections

The top 3 collections by volume in October were Dreadfulz, Terraforms by Mathcastles, and More Loot. The percentage of wash trading for each collection was 90%, 92%, 93%, respectively.

Top 10 Collections by Volume (October Report)

Wash Trade Stats of Selected Collections (Preview)

Blue chip collections tend to be a good bellwether of the NFT market since they don’t experience wash trading. There has been very little change from  September to October for either CryptoPunks or BAYC. 

BAYC: NFT Transactions

CryptoPunks: NFT Transactions

This piece is contributed by Footprint Analytics community.

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