In this article, we review the performance of the non-fungible token (NFT) sector during the first week of September. During this period, collectibles maintained the continued negative trend that was experienced during the bearish month of August.
It is worth remembering that last month, sales of digital collectibles hit annual lows amid a brutal drop in interest. While one could say that disinterest is the trend in the entire Cryptocurrency market over the past few months, the NFT market is in a particularly disastrous position. It should not be overlooked that during the crypto rallies, this sector also remained underperforming.
The rise of memecoins in 2024 and the fall of metaverse proposals have exacerbated market problems among NFTs. Simply put, investors see no difference between 2024 and 2020 in terms of evolution and attractive proposals for investing in the sector. The Metaverse and Blockchain or Web3 games were supposed to mark a change, but so far that has not been the case.
As far as the Metaverse is concerned, as already mentioned, it is a sector that is seen as very far away. Meanwhile, Web3 games are just taking their first steps and progress is not occurring at a speed that could set positive expectations among capitals.
Total NFT sales in August were disastrous. Source: Cryptoslam
Weekly data review for the NFT sector
As for the weekly review of NFT sales during the week, these maintained the negative trend. In total, sales accumulated $82.2 million dollars, according to data from Cryptoslam. Among the main blockchains, the performance was negative in general.
For example, Ethereum saw $30.9 million in sales, down -0.39% compared to last week. Another major network, Solana, saw $14.1 million in sales, down -26.21%. Bitcoin, with $10.9 million in sales, saw a weekly decline of -19.67%.
Weekly sales of digital collectibles. Source: Cryptoslam
As far as collections are concerned, CryptoPunks (Ethereum) maintains the lead, with $4.92 million in sales over these 7 days. This sales volume is 6.24% below that achieved the previous week. The second place among collections went to Guild of Guardians Heroes (Immutable-Zk), with $3.16 million in sales and a weekly decline of -5.52%. The podium is rounded off by Luxemarathones from the BNB Chain network.
As can be seen, general and collection sales, which were terrible in August, did not start on the right foot in September either. During this first week of the month, the worst moment for the sector in 2024 seems to be confirmed.
Weekly sales of major NFT collections. Source: Cryptoslam
The SEC on the attack
As if there wasn’t enough bad news, the Securities and Exchange Commission (SEC) turned its guns on the sector. The agency sent a Wells notice to OpenSea, one of the largest digital collectibles trading platforms.
The company reported receiving the notice in late August. It is important to remember that Wells notices are a warning that the Commission is about to sue a company. The latter has a short period of time to convince the SEC that it is wrong and should not be sued.
OpenSea has received a Wells notice from the SEC threatening to sue us because they believe NFTs on our platform are securities.
We’re shocked the SEC would make such a sweeping move against creators and artists. But we’re ready to stand up and fight.
Cryptocurrencies have long…
— Devin Finzer (dfinzer.eth) (@dfinzer) August 28, 2024
As you might expect, the SEC considers the NFTs traded on OpenSea to be unregistered securities. In that sense, the platform would have violated US securities laws.
All this context confirms that the NFT sector remains in an extremely delicate situation, both due to the sales data that we address in this review, and due to the regulatory issue. This means that, even if the market outlook improves, the SEC’s sword of Damocles remains threatening.
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