Brands launch NFTs<\/strong>
This week, the famous toy company Mattel announced the launch of the Fast and the Furious NFTs, ahead of the release of the movie. Last month, Starbucks launched a new NFT collection, and Nike-owned RTFKT released a digital sneaker collection of NFTs, that LeBron James was later spotted wearing. Brands haven\u2019t given up on their efforts to release nonfungible tokens. <\/p>\nBut data shows that NFT trading volume is at an all time low this year. <\/p>\n
\u201cIn the month of May, the NFT market has witnessed a significant shift. As of May 12th, the NFT trading volume has reached only $293 million,\u201d said Sara Gherghelas, a blockchain analyst at DappRadar. \u201cThis implies that for the first time this year, the monthly NFT trading volume might fall short of the $1 billion mark.\u201d <\/p>\n
Trading in projects like Donald Trump\u2019s NFTs, which sold out within 24 hours when it was first released in December, have plunged to an all time low, seeing an 80% drop from all-time highs, according to OpenSea data. <\/p>\n
So why do brands keep launching them when the numbers seem to show that the trend of buying and trading NFTs is dying off? Because for the most part, launching NFTs is helping brands build a community of super fans. Many of the launches come with built-in perks that can\u2019t be accessed through other means. <\/p>\n
Mattel\u2019s Fast & Furious project, for example, will give holders the opportunity to own a physical version of Suki\u2019s car if they manage to collect the entire set. Starbucks NFTs reward and connect with members by offering collectibles, digital stamps, and access to exclusive benefits. As a result, the companies that launch these projects, still end up selling them. When Starbucks launched an NFT collection in March, it sold out within the first 20 minutes. <\/p>\n
Other factors that are contributing to low trading volume have nothing to do with brands and include the rise in transaction fees, which can happen when there\u2019s a short-term frenzy around a particular item that everybody is trading. <\/p>\n
The recent rise of Pepe Coin, which we covered last week, has had this impact.<\/p>\n
\u201cThere has been a noticeable trend of NFT traders offloading large NFT holdings at a loss, in order to join the frenzy surrounding Pepe,\u201d said Gherghelas. \u201cThis surge in activity on the blockchain has subsequently led to a spike in transaction costs, which have exceeded $100 in some instances. This uptick in transaction costs has impacted the trading volume of low-value NFTs, as concerns about affordability have risen among traders.\u201d <\/p>\n
The question that remains, according to Gherghelas, is how the elevated transaction costs will shape the trajectory of the NFT market moving forward. It\u2019s unclear if the dip in trading volume this month signals a larger trend or merely a temporary setback driven by short lived hype. <\/p>\n
Crypto industry reacts to Department of Justice crackdown on crypto<\/strong><\/p>\nThe crypto industry is trying to figure out what to make of a crackdown by the U.S. Justice Department on crime on digital platforms. In an interview with the Financial Times, Eun Young Choi, the director of the department\u2019s national cryptocurrency enforcement team, said that the DOJ is focusing on companies that enable crimes to happen or commit them themselves, such as money laundering.<\/p>\n
Industry insiders say this is a good thing, but are concerned that too much enforcement without clear rules on how to regulate the space will cause companies to operate outside of the U.S. You can read the full story here. <\/p>\n
Crypto in a snap<\/strong><\/p>\nBitcoin
\n BTCUSD,
\n +0.41%<\/bg-quote>
\n rose 0.47% this week, and is trading at $27,084.70 as of Thursday afternoon. Ether
\n ETHE,
\n -2.33%<\/bg-quote>
\n is up 0.82% in the same period, and trading at $1,811.48 as of Thursday afternoon.<\/p>\n\n\n\n Biggest Gainers<\/strong><\/p>\n<\/td>\n\n Price<\/strong><\/p>\n<\/td>\n\n %7-day return<\/strong><\/p>\n<\/td>\n<\/tr>\n\n| \n Render <\/p>\n<\/td>\n | \n $2.36<\/p>\n<\/td>\n | \n 39%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Lido DAO<\/p>\n<\/td>\n | \n $2.20<\/p>\n<\/td>\n | \n 29.6%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Conflux<\/p>\n<\/td>\n | \n $0.29<\/p>\n<\/td>\n | \n 17.3%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Frax Share<\/p>\n<\/td>\n | \n $7.25<\/p>\n<\/td>\n | \n 15.8%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Synthetix Network<\/p>\n<\/td>\n | \n $2.34<\/p>\n<\/td>\n | \n 15.3%<\/p>\n<\/td>\n<\/tr>\n | \n| \n <\/td>\n | \n <\/td>\n | \n Source: CoinGecko<\/em><\/p>\n<\/td>\n<\/tr>\n<\/table>\n\n\n\n Biggest Decliners<\/strong><\/p>\n<\/td>\n\n Price<\/strong><\/p>\n<\/td>\n\n %7-day return<\/strong><\/p>\n<\/td>\n<\/tr>\n\n| \n XDC Network<\/p>\n<\/td>\n | \n $0.031<\/p>\n<\/td>\n | \n -7.4%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Klaytn<\/p>\n<\/td>\n | \n $0.17<\/p>\n<\/td>\n | \n -5.1%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Bitget Token<\/p>\n<\/td>\n | \n $0.45<\/p>\n<\/td>\n | \n -4.0%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Tether Gold<\/p>\n<\/td>\n | \n $1,956<\/p>\n<\/td>\n | \n -3.7%<\/p>\n<\/td>\n<\/tr>\n | \n| \n Gate<\/p>\n<\/td>\n | \n $4.86<\/p>\n<\/td>\n | \n -3.4%<\/p>\n<\/td>\n<\/tr>\n | \n| \n <\/td>\n | \n <\/td>\n | \n Source: CoinGecko<\/em><\/p>\n<\/td>\n<\/tr>\n<\/table>\n Must reads<\/strong><\/p>\nWhere\u2019s Shaq? Lawyers for FTX Investors Struggle to Serve Him Papers [Wall Street Journal]\n Crypto firm Ripple buys Swiss startup as SEC crackdown forces companies to consider overseas moves [CNBC]\n EU states approve world\u2019s first comprehensive crypto rules [Reuters]\n<\/p><\/div>\n | | | | | | | |