It was an excellent start in 2022 for OpenSea and NFTs, with their trade volumes hitting the highest point in January. The uptrend gave a bullish reflection for the year ahead.
According to Dune Analytics, the trading volume for ETH reached a high of USD 4.97 billion in the first month of 2022. The other high was reported in August 2021 when trading volume reached USD 3.42 billion.
February and March were, indeed, pretty disappointing, but the recovery reported in April is pretty impressive. The marketplace for NFTs is improving, with the recent support coming from the crypto market sell-off.
Trading at OpenSea Supported by ETH at Sub-USD 3,000
In March 2022, the trading volumes of ETH-based NFTs dropped to USD 2.49 billion. This was way below the USD 4.97 billion reached in January.
As it recovered from the January current year low, ETH revisited USD 3,500 levels before sliding to sub USD 3,000. In six of the nine trading sessions, ETH has fallen, finally returning to sub-USD 3,000 positive for NFTs based on ETH at OpenSea.
With Solana and Polygon NFTs taking only a small portion of OpenSea’s total trading volume, the main area of Focus is ETH.
This month, active traders rebounded, with the numbers rising to 281,546. As the month advances, the active traders could surpass 545,146, the number reached in January. This could be another positive achievement for the NFTs and OpenSea.
- Suggested Reading: How to Make Your Own NFTs?
The Impact on Trading Volume Surpasses the ETH Value
Factors that go beyond ETH are expected to influence the trading activity at OpenSea. Good examples of these include regulatory oversight, new NFTs launches, competition, and illicit activities.
In January, LooksRare was launched, and Coinbase is expected to join the crypto space with its much-awaited Coinbase NFT.
The final driver that will impact NFT numbers is the acceptance of fiat for payments. Coinbase has already partnered with Mastercard to allow conventional payments for NFTs.
The conventional payments will eliminate the bottleneck for NFT collectors to create wallets and acquire cryptos in the highly volatile market conditions. This partnership is likely to make other marketplaces follow the same trend.
The lovely thing is that common names in financial sectors are always exploring ways of entering the digital asset space. Investors will also be closely following how NFTs on the Solana platform are performing.
On the flipside, risks still abound, especially the threat of illicit activity and oversight by governments. A supportive regulatory oversight is needed to grow the token as opposed to being punitive. The move taken by regulators concerning NFTs could ultimately be linked to illicit activity in the unfolding NFT space.