The crypto market is in turmoil amid news of FTX’s liquidity crunch and alleged mismanagement of customer funds.
This crisis has sent shockwaves through the NFT market, leading to panic selling of NFTs. As the FTX debacle continues and investors remain uncertain about the future of cryptocurrency exchange, the ”floor price” of Bored Ape Yacht Club NFTs has dropped significantly.
As of this writing, the lowest available Bored Ape Yacht Club NFT on the market is listed for 57.5 ETH, or approximately $76,400. In terms of ETH, this is a 7% loss in the last 24 hours. However, considering the declining value of ETH (which is down 13% this week), it has plummeted about 24% in USD over the past day.
The current price of a Bored Ape NFTs (in USD) has dropped significantly since its peak of approximately $429,000 (152 ETH) on April 29 earlier this year. That’s an 82% fall.
There are a handful of plausible factors driving down Bored Ape’s pricing this week. One factor is overall crypto market dread in the aftermath of the FTX crash. It could be pushing some investors to sell their “blue chip” NFT assets. Surprisingly, there is on-chain evidence to support this behaviour.
WETH trades as a percentage of total OpenSea volume is above 50% for the first time today. The chart below is pretty wild.
Everyone accepting the bids that are out there.
This is up from 40% when I tweeted this chart earlier. pic.twitter.com/5Zo66UPLfF
— NFTstatistics.eth (@punk9059) November 9, 2022
More and more NFT owners are accepting lower bids than the market value. This implies that sellers are trying to swiftly dispose of their NFTs amid the market turmoil.
Another factor contributing to the crypto market’s collapse is BendDAO. It is a lending system that allows users to get crypto loans by leveraging their NFTs as collateral. BendDAO is now auctioning off 14 Bored Ape NFTs from liquidated loans, with current bids on all of them far below the market floor price on major marketplace platforms. This indicates that demand for the assets is weak.
BendDAO suffered a serious liquidity difficulty back in August when it ran out of ETH. And didn’t receive high enough bids to auction the NFTs seized from liquidated debts. Finally, protocol participants opted to decrease the liquidation threshold, making it simpler for BendDAO to sell off NFTs for underwater debt.
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.