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Despite BTC Ordinals Popularity, NFT Trading Volume Drops 35%

  • NFT trading volume decreased by 35% in Q2 2023, despite the widespread adoption of Bitcoin Ordinals.
  • Ethereum maintained its dominance in NFT trading, accounting for 83% of the total volume, but its market share temporarily fell to 73.3% in May due to the rising popularity of Bitcoin Ordinals, which contributed to 20.3% of the NFT trading volume that month.
  • Solana experienced the most significant decline in trading volume in Q2, dropping by 78.6% from the previous quarter.

Despite the widespread adoption of Ordinals, Bitcoin’s own version of non-fungible tokens (NFTs), the trading volume of these digital collectibles decreased by 35% in Q2 this year compared to the previous quarter, according to data from crypto aggregator CoinGecko’s 2023 Q2 Crypto Industry Report.

(Read more: What is the Current State of NFT-related Laws in the Philippines?)

NFT Trading Volume

According to the report, across the top 8 blockchain ecosystems Ethereum maintained its position as the leading platform for NFT trading, accounting for 83.0% of the total volume. The average amount for Ethereum’s NFT trading volume for this quarter only amounts to $870 million, around $570 million less from Q1’s $1.44 billion.

Despite this, CoinGecko reported that Ethereum’s dominance temporarily fell to 73.3% in May 2023, which coincided with the growing popularity of Bitcoin Ordinals, which accounted for approximately 20.3% of the NFT trading volume that month.

The report further noted that Solana, among various blockchain networks, experienced the most significant decrease in trading volume in Q2, with a decline of 78.6% from $184.91 million in Q1 to $39.66 million in Q2.

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In the early first quarter of 2023, two popular NFT collections on the Solana blockchain left the platform. “DeGods II” moved to Ethereum, while “y00ts” migrated to Polygon.

The other blockchain ecosystems, ImmutableX, Polygon, Flow, Arbitrum, and BNB Chain, also witnessed a marked decline in trading volume on their platforms.

NFT trading volume Coingecko
NFT trading volume Coingecko

Bitcoin Ordinals Trading Volume

Following its launch in January 2023, Ordinals rapidly gained popularity among the NFT space–from its trading volume of only $0.4 million from February it significantly went up by 25550% in just a month (March – $102.6 million). It went slightly down in the first month of the second quarter but went back to more than a hundred million for the next 2 months. 

Last May, global cryptocurrency platform Binance announced that it will support Ordinals inscriptions on its NFT marketplace “in the coming weeks.”  

The emergence of Bitcoin Ordinals also gained support from marketplaces such as UniSat and OKX. Magic Eden, which previously focused on Solana, also added support for Ordinals.

(Read more: What is Ordinals Bitcoin NFT | NFTs on Bitcoin Sparks Debate)

Bitcoin Ordinals Trading Volume
Bitcoin Ordinals Trading Volume

Ordinals is a protocol that utilizes “inscriptions” to create sequentially numbered satoshis (sats) on the Bitcoin network, effectively turning them into unique digital artifacts or NFTs. These inscriptions consist of arbitrary content like text or images, giving each satoshi a distinct identity. The protocol allows users to hold and transfer these distinctive digital assets across the Bitcoin network as part of its Bitcoin-based NFT ecosystem.

NFT Marketplace

The CoinGecko report disclosed that the NFT Marketplace Trading Volume experienced a 37.0% decrease in 2023 Q2. 

According to the platform, Blur maintained its position as the leading NFT marketplace due in part to the introduction of Blend, a lending platform for NFTs, as well as the promise of BLUR token rewards. Blur’s share of trading volume increased from 56% in the first quarter of 2023 to 65% in the second quarter. 

(Read more: Five Tips for Navigating the NFT Market in the Philippines)

Meanwhile, OpenSea’s share continued to decline, falling from 33% in the first quarter of 2023 to 23% in the second quarter.

This article is published on BitPinas: Despite BTC Ordinals Popularity, NFT Trading Volume Drops 35%

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.

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