The buzz of non-fungible token (NFT) trading may have hit a stumbling block recently, according to data from Web3 developer platform Alchemy. Trading volume fell 41% in Q2 this year, exhibiting the unpredictable nature of digital assets. However, while enthusiasm from collectors may seem to wane, the enthusiasm and bullish perspective from developers appear undeterred. An impressive 5.9 million smart contracts were deployed across Ethereum Virtual Machine (EVM)-compatible networks like Ethereum, Arbitrum, Optimism and Polygon. This marks a 1,107% increase since Q2 2022, despite turbulent market conditions.
Furthermore, Ethereum software development kits (SDKs) installations grew by 7% from the preceding quarter, with 26.8 million being installed in Q2. As Blake Tandowsky, growth analyst at Alchemy affirms, fewer users have been entering the NFT market, but the emerging use of NFTs in sectors like gaming is keeping developers eager to create on the blockchain.
As Ethereum‘s price increased 12% since last year, and smart contracts’ deployment surged, this hints at a robust growth landscape for Web3 and gives an impression that steps towards mass adoption are underway. The potential of Web3, however, extends beyond NFTs, with transactions including Nike‘s “Our Force 1” collection drop and the expansion of decentralized social media platform Lens Protocol. Google Play, the gaming marketplace, too, has shown support for games integrating NFTs, reducing the barriers to deploying decentralized apps.
Despite these advancements, pitfalls of the bear market have not spared the NFT domain. Trading volumes, which had seen a high of $2 billion in March 2023, crashed to potentially less than $1 billion by mid-May – a trough since January. Many sought-after NFT collections have shed major value from their bull market highs.
It’s apparent that while developers see promise in Web3 technologies and use cases that go beyond the digital asset craze, the market’s volatility could deter the momentum needed for Web3 to go mainstream. With the development of new potential use cases, Web3 might capture a wider audience, but can it weather out the unpredictable nature of the crypto market? Only time can tell if we can count on continued growth in Web3 as more than merely a surge in numbers.
Source: Coindesk
