A NFT Market Downturn or Trend?

There is a decrease in prices for all types of collections. Both well-known and lesser-known collections are negatively affected. Is this a temporary decline, and will NFTs recover in the next bull market? Or is this a fashion?
So, let's examine the present state of the NFT market in greater detail. The graph below depicts the decline of significant NFT floor values.

A Cryptocurrency Market Overview for July 2023

Before discussing NFTs, let's examine the July 2023 crypto industry overview. This also helps place everything into perspective. This article contains data from a DappRadar summary for the month of July.

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Looking at the UAW (Unique Active Wallets), we observe a 13% decline in July. This results in 1,7 million UAW per day (dUAW). There is one significant contributor to this decline. That's the regulatory ambiguity in the United States. With summer vacation, we have a combination of two significant factors:

Blockchain gaming is returning:

The dUAW only decreased by 0.5%. It has now achieved 41% dominance. On the contrary, DeFi continued to endure. June saw an increase, but July was not as strong. The UAW decreased by 26%, or 510,654 members. Nonetheless, this represents 30% of the industry's total user activity.
Regarding the social Dapp industry,

dUAW decreased by 2%. Nevertheless

its dominance remains unchanged at 15%. This is a market to monitor closely. Decentralized social media may begin to play a larger role in this industry.

In July, we see the BNB chain emerge as the leader among blockchains. They had a combined dUAW of 546,779 and a 21% market share. PancakeSwap remains the uncontested frontrunner in the BNB industry. 27 percent of all activity took place on this Dapp. WAX with Alien Worlds and Polygon with Stargate Finance also continue to be on the cutting edge. This is despite a slight decline in population.

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Ethereum and Arbitrage saw the greatest decline in numbers. The dUAW of Ethereum dropped to 29.8%. This is primarily the result of a weakening NFT market. Consequently, let's examine the NFT market.

The July 2023 NFT Market NFTs
' share of the crypto industry dropped to 4%. The dUAW stood at 70,338, representing a 19% drop. The NFT market declined further in July. During the first week, trading volume was approximately $182 million. During the fourth week, however, this figure decreased to $57.5 million. This is a 68% reduction within three weeks.
Comparatively to June 2023, the trading volume decreased. It decreased by 29% to total $632 million. In the interim, sales declined by 49% as well. 727,413 were reduced to 368,331. The melody 'I never promised you a rose garden' by Lynn Anderson could have been written for NFTs. Nonetheless, the average transaction price decreased as well. This results in a 'only' 23% monthly perspective.
What we do observe is a shift towards 'low barrier entry' NFTs. They gain in popularity. Their individual worth is diminished. Consequently, they attract a larger audience. Consequently, the dynamic NFT market can accommodate this change. The decline in trading volume does not indicate a loss of interest in non-traditional securities.
The broad public's attention can transfer to other cryptospaces. For instance, to DeFi. If DeFi thrives, NFTs typically suffer. The same appears to be true for the opposite situation. There is one chain that stood out, however. This is a Polygon. They dominated the number of traders with 772,424 or 27%.

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Thus, we observe a general downward trend. However, there are still prosperous fields, such as generative art. To summarize this NFT section, it is not as terrible as it may appear. DappRadar does not view this as a sign of decline or stagnation. They would prefer to see the NFT market mature and rebalance. There are new regions and a larger, more diverse audience.