NFT trading volumes on Ethereum experienced a boost in Q1 2023, surging when compared to the previous quarter. This can be partly attributed to the airdrop farming frenzy for Blur’s native token, an NFT marketplace and aggregator that was launched in October 2022. The project’s airdrop of the platform’s native token, BLUR, scheduled on February 14, 2023, brought considerable traction from airdrop hunters during the first quarter.
Crypto analytics firm Nansen shared data with Decrypt, revealing that NFT trading volume more than doubled in 2023, moving from $1.9 billion worth of NFTs traded in Q4 2022 to $4.5 billion in Q1 2023. While trading volumes saw a substantial increase, the number of unique wallets trading NFTs experienced a more modest rise of 24.5% within the same timeframe. Consequently, 13.9 million users were active in Q1 2023, compared to 11.2 million users in Q4 2022.
This data suggests that existing users were primarily trading at higher volumes, as opposed to a significant increase in new users, which could also be traced back to the BLUR token airdrop. However, despite the yearly trend, NFT activity for spring painted a slightly more bearish picture.
April witnessed a 30% decline in trading volumes across various marketplaces in comparison to March. Furthermore, the first week of May saw the lowest number of sales and users this year, as reported by Nansen, with the number of weekly NFT sales dropping to around 370,000. Consequently, trading volumes in May fell to bearish levels of 2022, with approximately 90,000 ETH being traded weekly.
It is essential to note that even though there has been a dip in ETH traded, trading volumes in USD terms have not been significantly affected due to Ethereum’s bullish start to the year. The second-largest asset by market capitalization was trading below $1,300 in Q4 last year, while it is currently valued closer to $1,900.
In conclusion, the surge in NFT trading volumes on Ethereum in Q1 2023 can be partially linked to the airdrop of Blur’s native token, resulting in increased interest among existing users. However, despite the overall positive trend in NFT trading volumes, recent months have seen a more bearish outlook, with declining trading volumes and sales across the market. The future of NFT trading activity remains uncertain, but investors and enthusiasts alike will continue to monitor the situation closely.