NFT Market performs well despite the crypto market downturn
The NFT market has outperformed the crypto market since the beginning of 2022. OpenSea racked up $2.29 billion worth of Ethereum trading volume so far in January. The decrease in crypto prices possibly contributed to the NFT’s performance since the lower ETH price gives investors a discount on the price of NFT in terms of fiat money. While some NFT collections have lost value in USD as the price of ETH sinks, others have risen. Popular NFT projects such as the Bored Ape Yacht Club and Doodles are surging of late. The floor price of BAYC has increased 17.7% since the beginning of this year (from 65 ETH to 76.5 ETH), according to data from Dune Analytics.
Source: Dune Analytics
As top NFT collections increasingly prove their staying power, it may be an opportunity for investors to transfer crypto holdings into another tokenized asset with steadier holding power (as ETH price is stable below $4000). That’s still a potential gamble, as the NFT market has been as famously volatile at times as the crypto market, but right now some top collections are acting as a store of value—much in the way that traditional art can.
This current divergence between NFT trading action and crypto prices could prove to be a short-lived blip on the radar. As Nansen Product Manager Paul Harwood suggests, Ethereum’s price and the NFT market are both on the rise when looking at a longer timeline.
A new NFT marketplace - Lookrare, which is expected to replace Opensea, has already generated $110 million in Ethereum NFT trading volume since its launch. Lookrare launched a “vampire attack” on OpenSea by offering airdrop of $LOOK tokens to OpenSea users who transacted at least 3 ETH on the marketplace between June 16 and December 16, 2021. Lookrare is an unaudited project but its high APR is super lurcative. The current APY for staking $LOOK is 787.13% with 365% in $LOOK and 422% in WETH.
Source: Dune Analytics
Taiwan icon Jay Chou’s PhantaBear NFT dethrones Bored Ape Yacht Club
A new non-fungible token (NFT) collection backed by Taiwanese superstar Jay Chou has dethroned Bored Ape Yacht Club (BAYC) on the OpenSea NFT marketplace in trading volume, reflecting a growing interest in celebrity-endorsed digital collectibles.
PhantaBear is a collection of 10,000 NFTs launched on January 1 by the fashion brand PHANTACi. It is currently the top project on OpenSea by sales volume in the past 24 hours. On January 9, it was trading at an average price of 7.39 Ethereum, or more than US$23,000, gaining more than 700 percent from January 6, when its average price was still below 1 Ethereum
In the past seven days, the NFTs’ trading volume reached 17,194.22 ETH (US$53.6 million), a 462.66% jump from a week ago, outrunning BAYC’s 16,583.65 ETH (US$51.7 million) and Doodles’ 16,407.14 ETH (US$50.7 million), as of Tuesday morning, according to OpenSea data.
On January 9, trading volume on OpenSea reached a record high of US$261 million, according to data from Dune Analytics. The marketplace wrote in a blog post that it experienced a sustained surge in API traffic that overloaded its systems and resulted in degraded performance and outages.
Near Protocol raises $150M to promote Web3 adoption
Proof-of-stake blockchain Near Protocol has raised $150 million in seed investments to accelerate the adoption of Web3 technologies. The team announced that the fund would be used to develop regional hubs and raise awareness for blockchain and decentralized tech.
Near Protocol aims to use the fresh funds to foster the adoption of Web3. According to the announcement, the funding will be used to “help billions of people learn and use blockchain.” With this, projects building on the Near blockchain will have the opportunity to connect with new audiences.
The investment round was led by hedge fund Three Arrows Capital, with additional participation from Mechanism Capital, Dragonfly Capital, a16z, Jump, Alameda, Zee Prime, Folius, Amber Group, 6th Man Ventures, and Circle Ventures. MetaWeb.VC, Near’s ecosystem fund, also participated in the seed round. Additionally, angels Alan Howard, Santiago Santos, and Aave founder Stani Kulechov joined the funding.
Macro market last week
In a Tuesday hearing, Federal Reserve Chairman Jerome Powell said that CBDC and private stable coins can co-exist. The report on digital assets will be released soon in the coming weeks. This is a good sign for the crypto market as previously there was a concern that CBDC could replace private stable coins.
Source: U.S. Bureau of Labor Statistics
US inflation hit 7% in December from a year earlier - the fastest pace in nearly 40 years. The inflation rate is likely to go up and peak in the next few months, according to Sarah House, director, and economist at Wells Fargo. Unlike previous occasions, this time the inflation news didn’t drive up the Bitcoin price. For retail investors whose incomes are from paychecks if their salary didn’t increase by at least 7% over last year, they are losing money.
Since the tapering is underway and the interest rate is expected to increase in March, resulting in higher costs of capital. Therefore investors carefully watch the market without making any big moves.