The first quarter of 2025 saw a significant downturn in the non-fungible tokens (NFTs) market, with sales dropping 63% year-over-year.
State of the NFT Market
The NFT market began 2025 with an unexpected decline, particularly noticeable compared to last year's figures. Overall NFT sales have decreased by 63% compared to the same period in 2024.
Bitcoin and Ethereum NFT Performance
Bitcoin-based NFT sales also experienced a substantial downturn, falling to $291 million, a 79% drop from $1.4 billion in Q1 2024. Meanwhile, Ethereum showed resilience with a 22% weekly increase in trading volume, contrasting Bitcoin’s 47% decline over the same period. Ethereum continues to dominate the NFT market despite a 58% monthly reduction in sales. Bitcoin, initially ranked second, has now fallen to 19th position, reflecting an 80% contraction in sales volume.
Reasons for NFT Market Decline
The significant contraction is in line with the overall drop in total NFT sales across all blockchains, witnessing a 43.17% reduction. Research indicates that 98% of NFT collections are rarely traded. Only 0.2% of NFT drops have been profitable, with most losing over 50% of their value within days. Despite Ethereum’s dominance in the NFT sector, a 58% monthly contraction in sales volume has failed to absorb sell-side liquidity. If this trend persists, the prevailing bearish sentiment around Ethereum may intensify, potentially undermining its strength relative to Bitcoin.
The pronounced correction in the NFT market at the beginning of 2025 highlights the importance of adapting to changing conditions and focusing on dominant blockchains. Ethereum sales continue to lead, though overall sentiment remains bearish.
