With increased pessimism in the macro landscape, the NFT market remains steady. OpenSea has seen an increase in volume this week. However, with liquidity low, it takes only a few big purchases of blue-chip collections to drive up the volume numbers.
New NFT collections continue to release but many more are holding off towards releasing collections in mid to late Q4 2022. What is promising is to see more companies using NFT technology.
Ethereum NFT Market Sentiment
The technical outlook of Ethereum is signaling that the bears are in control of the market. ETH was trading in the $1,300 range, above the immediate support level of $1,266. ETH had previously failed to break above this psychological level on the 4-hour chart thrice this week.
The pair declined below the 50% Fib retracement level from the $1,262 swing low to the $1,340 high. Failing to close above $1,300 will push the ETH price to the $1,200 support level. ETH has to trade above the $1,350 level to overcome the bearish momentum.
NFT Market Cap & Volume
Ethereum and other digital assets are struggling to stay afloat in the crypto winter, and various macro and micro events have adversely affected the crypto market. Non-fungible tokens were not left untouched either. The number of sales over the week plunged further by 17.76% to 15K. The total sales (USD) also dropped by 18.54% to $9 million.
The total market volume of this week increased slightly by 1.65%. The market cap remains untouched at 9.78 million ETH this week as well. Unlike last week, most of the blue-chip NFTs, except Azuki, seem to be bleeding red.
NFT Holders and Traders
While the number of traders this week increased by 13.45%, the number of holders remained the same, following the past week’s trend. The whales presently control 1.67 million ETH worth of NFTs, or 17.11% of the 9.78 million ETH global market cap (identical to last week).
NFT User and Transactions on OpenSea
The number of transactions in the OpenSea smart contracts this week totaled 298.77k, matching the amount from the week before. The decline that we saw in the previous weeks seems to have stopped. With OpenSea seeing a massive 348.84% increase in its weekly volume this week, can OpenSea’s once-lost grip over the NFT market tighten again?
Solana NFTs
SOL has failed to stay above the $30.50 support level and is now trading at $29. The next strong support is at $25.91; failing to keep it will make the price spiral down. Technical signals from SOL portray a dismal view.
The two Solana marketplaces, MagicEden and OpenSea, had a surge in overall weekly trade volumes this week. While the volume in OpenSea doubled, it halved in Solanart. There are reports that suggest NFT traders are running from Solana to Cardano due to network advantages.
Tezos NFTs
$XTZ fell below the $1.40 support line and is currently trading sideways at $1.348. Next immediate support is at $1.33. $XTZ has already fallen below this level twice this week. $XTZ, undoubtedly, is on a downtrend and we can expect even more lows in the coming days.
Quickfire NFT News Roundup
1) NFT Collection Azuki Releases Physical Backed Token
- Anime-inspired NFT project Azuki launched Physical Backed Token (PBT) – an open-source token standard that links a physical object to a virtual token on the Ethereum blockchain.
- The initial implementation of the PBT features the BEAN Chip, which is a physical cryptographic chip self-generating an asymmetric key pair.
- The PBT and BEAN Chip combine to introduce a feature known as “scan to own.”
- The PBT aims to provide trustless authentication by enabling decentralized authentication and tracking of the complete ownership history of physical goods, both entirely on-chain and without a centralized server.
2) 2.5 Million Crypto Wallets Opened by Reddit Users After the NFT Marketplace Launch
- Reddit has been planning to roll out NFTs since the original release of “CryptoSnoo” in June 2021, an NFT collection based on the platform’s logo, Snoo.
- Reddit released its NFT marketplace to the general public in July in advance of its August airdrops to users with high karma across four Snoo-based collections.
- Reddit potentially has more active wallets than OpenSea.
3) IRS Updates Its Reporting Guidelines for Digital Assets to Include NFTs
- The new rules require NFT investors to report all taxable NFT income.
- All “digital assets,” such as stablecoins, non-fungible tokens (NFTs), and cryptocurrencies, will be subject to the same tax laws, according to the IRS’ tax year 2022 guide.
- Capital gains tax will now be due and payable by taxpayers who “disposed of any digital asset in 2022” through a sale, exchange, gift, or other transfer.
- Any person who received NFTs in exchange for services rendered or who sold a digital asset they had on hand will also be required to report it as income.
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