- NFT trades on the Ethereum network have declined 70% in USD value, dropping from $2.6 billion to $672 million within a month.
- Web3 enthusiast Snoop Dogg, alongside Champ Medici believes there are opportunities in Ethereum despite declining NFT trades.
- Analysts argue that Ethereum fundamentals point to increased downside risks with the next support level below $500.
Snoop Dogg and his son Champ Medici are one of the most prominent celebrities in the Ethereum NFT ecosystem. While Ethereum is hit by a crypto bloodbath, Dogg argues that the bear market is weeding out all the people who are not supposed to be in the space.
Also read: Why crypto exchange dYdX abandoned Ethereum in ongoing bloodbath
Ethereum liquidity crunch pushes NFT skeptics out
In the recent crypto market bloodbath, Ethereum price plummeted from its peak of $1,266 on June 26, 2022 to $1,035 at the time of writing. Based on data from Nansen, the drop in Ethereum price is accompanied by shrinking NFT trades.
The total volume of Ethereum NFT trades declined by 55% over the past month. While in May 2022, NFT trades accounted for 1.3 million ETH, the number has shrunken to 584,000 ETH. In USD value, that is a 70% decline, from $2.6 billion in NFT sales to $672 million.
Blue chip NFT projects like Bored Ape Yacht Club and Goblintown did not witness an increase in price, and there is an overall decline in digital art, collectible trades on the Ethereum blockchain.
Yet, the average price of NFTs that belong to the top five collections on OpenSea, the largest peer-to-peer marketplace, has remained largely unchanged. This does not imply that NFT sales have declined, transactions are still being completed, just at a lower overall price. NFT enthusiasts are keen on free mints, like Goblintown, rather than collections with high floor prices.
OpenSea noted sales of 1.478 million NFTs in May 2022, followed by 1.476 million in June 2022 and it is likely that more digital art and collectibles on the Ethereum blockchain will be sold in July, than the last two months.
Snoop Dogg, a leading celebrity, popular in the Web3 ecosystem believes the crypto bloodbath has pushed skeptics out of the ecosystem. Dogg was quoted as saying,
I feel like this [crypto winter] weeded out all the people who weren’t supposed to be in the space and who were abusing the opportunities that were there.
The liquidity crunch has pushed key players in the Ethereum NFT space into a financial crunch, this separated skeptics from the NFT proponents.
Record labels could soon venture in the Ethereum NFT ecosystem
In early 2022, Snoop announced his plans to turn Death Row Records, a label acquired from MNRK Music Group into an NFT label. Soon after one of the NFTs from “Journey of the Dogg” sold at an auction for over $100,000.
Snoop has amassed $17 million in NFTs under the alias Cozomo de’ Medici. He told CNBC in an interview,
I know [NFTs] have a great opportunity to be big in music, because sooner or later the labels are going to have to come on in. They’re going to have to come on home and sit at the table and understand that catalogs and things they hold onto are better served on the blockchain than sitting in the catalog collecting cobwebs.
Champ Medici, Dogg’s son believes it's not just labels that are venturing in the Ethereum NFT ecosystem,
It’s movie studios, it’s tech companies, it’s beverage companies … everybody’s rushing to Web3 and they see how big Dogg is in the space.
Next big move in Ethereum price, sub $900
@Murfski_, a swing trader and analyst evaluated the Ethereum price chart and noted that after sweeping the previous low at $1,000, Ethereum price could bounce back. yet the likelihood of recovery is low, and the analyst believes the next big move is set to occur sub $900.
$ETH
✅ $1,000 (close enough)
We've swept the old low and the reaction has been poor so far
Not ruling out a bounce here, but the overall thesis still stands
Lows likely the next big move to happen at sub $900 pic.twitter.com/ZgBWTLtFsS
— Murfski (@Murfski_) June 30, 2022