ETH rumors impacts on Ethereum NFTs

    Introduction

    • In this Analysis, You will Read about the impacts of FTX and ETH rumors on Ethereum NFTS. As you may know, the FTX exchange crashed on November 7. Due to that, the ETH price dropped about 15% and caused selling pressure on the ETH token. I went through NFTs on Ethereum and analyzed these parameters:

    • Mint

    • Sales

    • Volume

    • Top Collections

    • Top Buyers and Sellers

    • Top Profitable Users

    • Top Unprofitable Users

    • Flippers

    Analyzed by Hess - Reading Time Almost 10 min.

    Method

    • The Method was simple. I used NFT Mint and Sales tables for most of my charts. In order to understand the change better, I divided the data into two categories. Before FTX and After FTX. I chose November 7 as the day of the FTX meltdown.
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    Sales

    Maybe Minting NFTS is not important as NFT sales. Now It’s time to examine the daily sales and FTX impacts on NFT sales.

    • Since the middle of October, The daily number of sales decreased day by day. But After the FTX crash, The total daily sales decreased by nearly 30%! It is a huge number. The total daily number of sales decreased from 30-35K to 26-27K. Unlike the Mint transactions, The total daily sales didn’t grow again and still are below 30K. The average number of sales was 37K before FTX and 26K after FTX. If we consider these numbers, The total sales dropped by 35-40.
    • It seems users still have doubts about Ethereum. They prefer to wait until see where the market goes. There are some rumors that the ETH price will drop to 650-700 US dollars. These rumors impact NFTs as you can see.
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    Top Collections ( 15 Days After and Before FTX )

    I extracted the top 10 collections based on transactions and volume 15 days before and after the FTX crash to see their changes.

    • Based on total sales volume, The top collection 15 days before FTX was More loot with 33M US dollars. 15 days after the FTX crash, This collection wasn’t the top collection. The total sales volume of More loot dropped by 50% after FTX. The other top collection was Dreadfulz with 32.6M US dollars in sales before FTX. It seems this collection still is in the top collections after FTX. The most popular collection, Ape Yacht Club, became the top collection after the FTX crash. The total sales volume of this collection increased nearly 2x after FTX. Before FTX was 16M US dollars but after FTX was 31M US dollars. I can see one collection that was in the top 10 collections before FTX but it wasn’t in the top 10 after FTX like Art Blocks or Terraforms. Also, I can see two collections that weren’t in the Top 10 collections before FTX but were in the top collection after FTX.
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    What is Ethereum?

    • Ethereum is a decentralized, open-source blockchain with smart contract functionality. Ether is the native cryptocurrency of the platform. Among cryptocurrencies, ether is second only to bitcoin in market capitalization. Ethereum was conceived in 2013 by programmer Vitalik Buterin.
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    What is NFT?

    • A non-fungible token is a unique digital identifier that cannot be copied, substituted, or subdivided, that is recorded in a blockchain, and that is used to certify authenticity and ownership

    Full Analysis

    Mint

    • Mint means buying new NFTs from the New collection or new NFTs from the old collection. Usually, Most mints are free and users are whitelisted before the mint date.
    • I examined the total daily number of mints and minters in the last 45 days ago. Overall, the number of mints and minters decreased in November in comparison to October. Also, After the FTX crash, The total daily number of mints and minter decreased more.
    • The total daily number of mints in late October was up to 96K but In November decreased to 40-45K. Again, After the FTX crash decreased to below 30K for almost three days. Again after that increased.
    • The average number of mint transactions was 66K before the FTX and 46K After FTX. Also, The average number of minters was 46K before FTX and 35K after the FTX crash.

    Top Users

    I examined the top 10 users based on volume 15 days before and after the FTX crash to see any change in their behavior.

    • There were three top users that were in the top 10 buyers but they weren’t in the top ten users after the FTX crash. Also, There were three top users that were in the top ten buyers before the FTX crash but they weren’t in the top 10 after the FTX crash. Others were top users before and After FTX users. The sales volume of top buyers before the FTX crash was higher than the average sales volume of top users after FTX.
    • Sellers were like buyers. Some sellers weren’t in the top 10 users before FTX but they were in the top 10 users after the FTX crash.

    Flippers

    • Due to the lower sales, The total daily number of flippers decreased by 30-40%. The total daily number of flippers before the FTX crash was about 9-10K but after the FTX crash decreased to 6-7K.

    It is normal that Projects or collections to launch their new product or NFTs when the Market is more stable.

    • According to the daily number of NFTs and Collections, both decreased for a short time. The interesting thing is that the highest number of minted NFTs in the last 45 days was a day after the FTX crash. On that day, Users minted more than 100K Unique NFTs while the daily minted NFTs were 20-30K on normal days. Also, The lowest number of minted NFTs was after the FTX crash. Users minted only 16K NFTs on November 9.
    • The average number of minted NFTs was 25.8K before FTX and because of minted 105K NFTS in November, The average number of minted NFTS after FTX was 26K. On the other side, The average number of collections was 153 before FTX and 136 after FTX.


    The total daily number of buyers and sellers following the transactions. Like the total daily number of sales, The total daily number of buyers and sellers decreased day by day too.

    • There is a point in the chart where the total daily number of buyers and sellers dropped hugely. Two days before the FTX crash, It seems the total daily number of buyers and sellers increased but after FTX dropped 30-40%!
    • The average number of buyers was 19.7K and sellers were 25K before the FTX crash while after the FTX meltdown, The average number of buyers was 14.9K and sellers 19.3K. Based on these averages, The total daily number of buyers and sellers dropped by 20-25%.


    In my opinion, The NFT sales volume is the most important parameter. We already examined the total daily number of sales, buyers, and sellers. Now It’s time to examine the sales volume in USD.

    • Before the FTX crash, I can see There was a sign that daily volume increased. A week before the FTX crash, The highest sales volume increased up to 47M US dollars. It was the highest sales in the last 45 days. But When FTX crashed and ETH price dropped, The daily sales volume decreased to 19-20M. Nearly 50% drop from a week before FTX. The total daily sales volume still is lower than the normal days. The average sales volume was 27M US dollars before the FTX crash and 18M US dollars after FTX.

    I dew a chart that shows the total daily sales volume and total sales tranasctions based on color. Red circle shows the volume with more tranasctions and grey shows the volume with lower tranasctions. As you can see, After FTX crash, The circles are more grey but in the middle of October, The circles were more Red. Also, The highest volume happened with lower number of transactions in October 30 and November 1.


    Based on the total daily sales, I extracted the average price of NFTs per day Vs. The ETH price.

    • On November 5, The ETH price was at the highest price in the last 45 days. The highest average price of NFTS was when the ETH price increased. When the ETH price dropped, A day after, The average price of NFTs increased and became 2x higher. But quickly, Followed the ETH price pattern and The average price of NFTS dropped by 50%. Overall, I can not see much difference in average NFT prices before and after FTX. The average price of NFTs was 473 US dollars before FTX while the average price of NFT was 456 US dollars After FTX. It seems, When the ETH price dropped, The Average price of NFTs in ETH increased.

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    • There is a point in the daily number of collections and NFTs chart that show the total number of collections decreased hugely. But why? In my opinion, Users bought from Famous and popular collections more in comparison to non-famous collections. because it is risky. Based on the previous chart, The average price of NFTs didn’t change even when the ETH price dropped by 20-30%. The Supply and Demand for popular collections still are in a good position and they can recover their price in USD like before the crash. I mean, Their ETH price increased and keep their US value.

    There is a direct relationship between Daily sales volume and platform fees. When the total daily sales decrease, The total daily platform fees decrease too. Collections can recover their price but platforms should wait for more buyers and sellers. The average platform fee was 377K per day before the FTX crash but After the FTX crash decreased to 256K per day. About 100K US dollars dropped.

    THANK YOU FOR READING!

    ALL CODES AND CONTENTS WERE WRITTEN BY HESS.

    :bird: Twitter: @hessaminanloo

    :t-rex: Discord: hess#0890

    :calendar: Analyze Date: 2022/NOV/26

    Conclusion

    After a shock in the market, It is normal that user’s activities to decrease. Especially, when the price of native blockchain tokens dropped. We can not say that NFTs are going to zero. Quickly, After a short period, All parameters will recover as fast as possible. Also, As you can see, The average price of NFTs in USD didn’t change. So Users that hold NFTs had a lower loss in comparison to others that hold tokens.

    Whales Activity

    Who is a Whale? I filtered only those addresses that hold +100 ETH in their wallets. I called them whales.

    • Whales always are a metric that we can guess the next market move. As you may know, Whales are active in NFTs. I examined their activities in the last 45 days. Since October 31, When the ETH price increased, The total daily number of sales by whales increased. But after that, Day by day, The total daily number of sales decreased like the last week of October 2022.
    • The average number of sales by whales was 66 before FTX and 56 after the FTX crash.
    • Before the FTX crash, At the beginning of November, The total daily sales were above 90 transactions but after a week after FTX, the total daily number of sales decreased to 50-60 transactions.
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    Whales usually buy Expensive NFTs from popular collections.

    The total daily sales volume reached up to 3.5M US dollars in the middle of October but a week after and before November the total daily sales volume by whales decreased to 800-1.1M US dollars. The average volume of whales was 2.2M US dollars and was 1.4M after FTX.

    • The average of NFTs that whales bought increased after the FTX crash. Actually, The average price didn’t change too much but If we ignore the highest average on November 20, I can see a little growth in comparison to a week before FTX.