NFT
The Non-Fungible Token (NFT) market has experienced tremendous growth in recent years, with many investors and artists flocking to the space to create and trade unique digital assets. However, there have been recent concerns about the viability of NFTs on the Polygon chain, a popular Ethereum Layer-2 scaling solution. Some have even suggested that NFTs on Polygon may be “dead”.
Formerly known as Matic, Polygon is a Layer-2 scaling solution that aims to make Ethereum more efficient and affordable by increasing transaction speed and reducing gas costs. It has become a popular choice for NFT makers and traders due to its low fees and fast transaction times.
Polygon NFT Marketplace Sees Almost No Growth
Polygon NFTs failed to get off the ground in Q2 and Q4 last year due to the contagion of the crypto market, thanks to Three Arrows Capital and FTX. But even after the market recovered in recent months, Polygon’s situation remained unchanged even as competitors experienced growth.
While the NFT space should change, Polygon NFTs should be aware of any increase in demand. Initially, this was tied to the larger narrative of minimal use cases presented by NFTs, but this has evolved over the past few months. The financialization of NFTs has enabled non-fungible token holders to use their NFT(s) as collateral for loans, providing owners with liquidity.
This increased trading volume on the Ethereum and Solana NFT platforms. Blur on Ethereum and TensorSwap on Solana have seen the biggest increase in volume over the past six months. Only Opensea reported modest growth on Polygon.
This is due to two factors. One is the general decline in cryptocurrency market conditions prior to the January surge. Second, there are not enough traders on Polygon’s NFT marketplace.
The influence of the latter factor eventually quelled the bullishness observed between January and March. However, Polygon’s MATIC transactions and network usage improved over the same period, indicating that the broader market effect was unrelated to the fact that NFT markets remained subdued.
Sales of various NFT marketplaces are on the rise
Despite the fact that the Ethereum blockchain remains by far the most popular choice for minting non-fungible tokens (NFT), other layer 1 blockchains and layer 2 networks have recently seen modest increases in NFT sales.
CryptoSlam data indicates that layer 1 blockchain Cardano, whose token is ADA, briefly surpassed Ethereum scaling platform Polygon as the fourth most popular blockchain by NFT sales volume.
According to CryptoSlam, Cardano had dropped to sixth place by Tuesday afternoon, behind BNB and Polygon, even though its 24-hour sales were up 86%. CNFT.io reports that trading volume for Goofy Gophers and Spacebudz has crossed 185,000 ADA (approximately $70,000) in the past 24 hours.
The sales volume of other blockchains, including Solana (SOL), has increased over the past week. On April 22, Solana saw an increase in sales, unique buyers, and unique sellers, primarily due to the release of Mad Lads, which was so in demand that its release had to be postponed.
According to Crypto Slam, the mad rush for the Mad Lads contributed more than $8 million to the $9.9 million in sales on April 22 — a level not seen since January. Solana’s sales volume is up 129% in the past week.
In the meantime, NFT enthusiasts are concerned that Polygon’s sales volume is declining. It seems their concerns are based on the fact that NFT collection y00ts recently moved from Solana to Polygon.
Despite these concerns, some experts believe NFTs on Polygon are far from dead. They point to the continued growth of the Polygon network and the many projects and initiatives being developed in the chain. In addition, they suggest that the recent decline in NFT sales is a temporary dip rather than a long-term trend.
While there have been concerns about the viability of NFTs in the Polygon chain, it’s too early to declare them “dead.” The NFT market, like all markets, is subject to fluctuations and volatility. However, the long-term potential of NFTs and the Polygon network remains strong, and we can expect continued growth and innovation in the space in the coming months and years.
