NFT traders are reeling from the SVB crash, which hit the industry hard.
There’s nothing like an unexpected catastrophe to kill the buzz. Indeed, following the FTX black swan event, we’ve been dealing with another cataclysmic episode thanks to Silicon Valley Bank (SVB). In fact, NFT trading volume had its worst day of the year on March 11th. On this day, there were 11,400 NFT traders, which is also the lowest number since November 2021. Thus, a promising year for NFT trading in 2023 has been dealt another blow.
Why does SVB matter for NFTs?
Put simply, the SVB disaster is taking traders’ attention away from NFTs. Moreover, the bank’s demise directly impacts the crypto industry. Being the biggest bank for tech startups and Web3 brands, the fall of SVB has had a chain reaction on the crypto and NFT industry. Furthermore, depending on their exposure to SVB’s collapse, some major NFT brands have been adversely affected. For instance, Moonbirds lost 18% of its value when the news hit, according to DappRadar. What is more, one Ethereum address sold almost 500 Moonbirds NFTs for losses between 9% and 33%.
However, the SVB debacle is not hurting the entire NFT industry. Blue-chip NFTs like Bored Ape Yacht Club (BAYC) are proving resilient. For example, BAYC’s and floor price suffered a slight dip below $100,000 on March 11th, and quickly recovered. Hence, blue-chip NFTs like BAYC and CryptoPunks are proving a worthy investment and largely disaster proof.
Gaming remains stoic
You can’t keep the gaming industry down. History tells us that playing games is a past time we will always enjoy, regardless of what’s going on outside. In addition, it seems that on-chain gaming is similarly robust during a worldwide financial crisis. For example, on the weekend of the SVB crash, Web3 gamers kept playing as usual. Actually, on-chain gaming activity was 10% higher than the previous weekend. Therefore, in the midst of economic uncertainty, Web3 gamers keep playing – much like traditional gamers.
In summary, we’re all reeling from the SVB disaster, and some are feeling it more than others. Yet, as the numbers have revealed, there is also strength and resilience in the NFT industry.
